WINDY A.

MALAPIT
OBLICON CASE DIGEST
CORTES vs CA
(G.R. No. 126083)
FACTS: This is a petition for reversal of decision made by the Court of Appeals setting aside the
decision of Trial Court to rescind the contract between Antonio Cortes and Villa Ezperenza
Development Corporation for the contract of sale of land amounting to 3! million pesos located at
"aclaran# $etro $anila with the following terms:
The Corporation shall advance %% $ as downpayment# and Cortes shall li&ewise deliver
the TCT for the 3 lots
The balance of '($ shall be payable within a year from the date of the e)ecution
The Corporation paid the partial the amount of *'#%'3#+++++ as downpayment but Cortes failed
to deliver the CTC and the original copy of the Deed of ,ale arising resulting to the filing of this
instant case by the Corporation praying for specific performance to deliver the CTC and the Deed
of sale from the petitioner
Cortes claimed that the owner-s duplicate copy of the three TCTs were surrendered to the
Corporation and it is the latter which refused to pay in full the agreed down payment
.TC ruled rescinding the contract of sale and return the downpayment with interest for the
Corporation having failed to pay in full the amount of *%#%++#+++++ despite Cortes- delivery of the
Deed of Absolute ,ale and the TCTs# rescission of the contract is proper
/n appeal by the respondents# CA reversed the decision of the .TC directed Cortes to e)ecute
the Deed of ,ale simultaneous with the Corporation payment of the full balance of purchase 0t
found that the parties agreed that the Corporation will fully pay the balance of the down payment
upon Cortes- delivery of the three TCTs to the Corporation The records show that no such
delivery was made# hence# the Corporation was not remiss in the performance of its obligation and
therefore 1ustified in not paying the balance
2owever# Cortes file a petition praying for the reinstatement of rescinding the contract by .TC
since the Corporation failed in the performance of their obligation
ISSUE: 3hether or not there is delay in the performance of the parties- obligation that would 1ustify
the rescission of the contract of sale4
RULING: 5/ There is no doubt that the contract of sale in 6uestion gave rise to a reciprocal
obligation of the parties
,ince Cortes did not perform his obligation to have the Deed notarized and to surrender the same
together with the TCTs# the trial court erred in concluding that he performed his part in the contract
of sale and that it is the Corporation alone that was remiss in the performance of its
obligation Actually# both parties were in delay Considering that their obligation was reciprocal#
performance thereof must be simultaneous The mutual inaction of Cortes and the Corporation
therefore gave rise to a compensation morae or default on the part of both parties because neither
has completed their part in their reciprocal obligation Cortes is yet to deliver the original copy of
the notarized Deed and the TCTs# while the Corporation is yet to pay in full the agreed down
payment of *%#%++#+++++ This mutual delay of the parties cancels out the effects of default#
such that it is as if no one is guilty of delay
Cortes argument would have been correct if he actually surrendered the Deed and the TCTs to the
Corporation 3ith such delivery# the Corporation would have been placed in default if it chose not
to pay in full the re6uired down payment 7nder Article ''89 of the Civil Code# from the moment
one of the parties fulfills his obligation# delay by the other begins
The Court of Appeals therefore correctly ordered the parties to perform their respective obligation
in the contract of sale# i.e., for Cortes to# among others# deliver the necessary documents to the
Corporation and for the latter to pay in full# not only the down payment# but the entire purchase
price
HEIRS OF GAITE vs THE PLAZA, INC.
( G.R. No. 17768)
:ACT,: This is a petition for review see& to reverse and set aside the decision of CA terminating
the Construction contract between ;aite and *laze Corporation
The *laze Corporation thru <ose .eyes =*resident> contracted .hogen "uiders represented by
.amon ;aite to construct a restaurant in $a&ati for !8 million *laze paid downpayment of '# '((#
+++ and the construction started but the $unicipality of $a&ati ordered ;aite to cease the
construction in violation of the 5ational "uilding Code as follows:
' 5o permit for Temporary ,tructure
% 5o notice of concrete pouring
3 ,ome wor&ers have no safety devices
? The ,ecretary and Construction :oreman refused to @receiveA the Better of ,toppage
dated ,eptember '+# '9C+
( $r .amon ;aite @isA 6uestioning the authority of the "uilding /fficial-s 0nspector
8 Construction plans use@dA on the 1ob site is not in accordance to the approved plan
.
;aite communicated with .eyes and the pro1ect manager to resolve the following issues but failed
to get the needed cooperation instead the *laza# through .eyes# countered that it will hold ;aite
and .hogen fully responsible for failure to comply with the terms of the contract and to deliver the
finished structure on the stipulated date
*laze Corporation filed suits against ;aite and .hogen for breach of contract# sum of money and
damages and nullification of the pro1ect development contract D .TC of $a&ati granted the
decision in favor of *laze Corporation The trial court pointed out that .hogen is not only e)pected
to be aware of standard re6uirements and pertinent regulations on construction wor&# but also
e)pressly bound itself under the ;eneral Construction Contract to comply with all the laws# city
and municipal ordinances and all government regulations 2aving failed to complete the pro1ect
within the stipulated period and comply with its obligations# .hogen was thus declared guilty of
breaching the Construction Contract and is liable for damages
*etitioners filed an appeal to CA invo&ing Article ''9' of the Civil Code# which states that the
power to rescind obligations is implied in reciprocal ones# in case one of the obligors should not
comply with what is incumbent upon him
ISSUES:
' 3hether of not the *laza Corporation has a legal ground in terminating the construction
contract4
% 3hether or not the CA gravely erred in not holding that there were valid and legal
grounds for .hogen to terminate the contract4
RULINGS:
' EE, According to the CA# The *laza cannot now be demanded to comply with its
obligation under the contract since .hogen has already failed to comply with its own
contractual obligation Thus# The *laza had every reason not to pay the progress billing
as a result of .hogen-s inability to perform its obligations under the contract Clearly#
.hogen cannot blame The *laza for its own failure to comply with its contractual
obligations CA therefore did not err in holding that .hogen committed a serious breach
of its contract with The *laza# which 1ustified the latter in terminating the contract
*etitioners are thus liable for damages for having breached their contract with respondent
The *laza Article ''!+ of the Civil Code provides that those who in the performance of
their obligations are guilty of fraud# negligence or delay and those who in any manner
contravene the tenor thereof are liable for damages
% 5/ .eciprocal obligations are those which arise from the same cause# and in which
each party is a debtor and a creditor of the other# such that the obligation of one is
dependent upon the obligation of the other They are to be performed simultaneously
such that the performance of one is conditioned upon the simultaneous fulfillment of the
other .espondent The *laza predicated its action on Article ''9'of the Civil Code#
which provides for the remedy of FrescissionG or more properly resolution, a principal
action based on breach of faith by the other party who violates the reciprocity between
them The breach contemplated in the provision is the obligor-s failure to comply with an
e)isting obligation Thus# the power to rescind is given only to the in1ured party The
in1ured party is the party who has faithfully fulfilled his obligation or is ready and willing to
perform his obligation The construction contract between .hogen and The *laza
provides for reciprocal obligations whereby the latter-s obligation to pay the contract price
or progress billing is conditioned on the former-s performance of its underta&ing to
complete the wor&s within the stipulated period and in accordance with approved plans
and other specifications by the owner
PCIC vs PETROLEU! "ISTRI#UTORS AN" SER$ICE
CORPORATION
(G.R. No. 1808%8)
FACTS& A petition for review see&ing to reverse the decision of CA which affirmed the decision of
.TC *asay with modification on damages
*etroleum Distributors and ,ervices Corporation (PDSC)# through its president# Conrado *
Bimcaco# entered into a building contract
@3A
with 5C :rancia Construction Corporation (FCC)#
represented by its president and chief e)ecutive officer# Emmanuel T :rancia# for the construction
of a fourHstory commercial and par&ing comple) located at Domestic .oad# *asay City# &nown as
*ar& I5 :ly "uilding (Park N Fly> for the price of ?(#(%%#'9!!%
"oth parties agreed that the construction wor& would begin on :ebruary '# '999 and to finish
/ctober %+# '999 with stipulations that that in the event :CC failed to finish the pro1ect within the
period specified# li6uidated damages e6uivalent to 'J'+ of 'K of the contract price for every day of
delay shall accrue in favor of *D,C
To further ensure compliance# :CC singed ,urety "onds holding themselves personally liable for
the accountabilities and *erformance "onds from *C0C for secure and faithful performance of the
obligation
,ince there was behind the schedule of the pro1ected wor& path# *D,C and :CC li&ewise
e)ecuted a memorandum of agreement (MOA)# wherein the parties agreed to revise the wor&
schedule of the pro1ect was e)tended up to $arch %# %+++
:or failure of :CC to accomplish the pro1ect within the agreed completion period# *D,C# in a letter
dated December 3# '999# informed :CC that it was terminating their contract based on Article '%#
*aragraph '%' of the "uilding Contract Despite notice# *D,C did not receive any reply from
either :CC or *C0C# constraining it to file a complaint for damages# recovery of possession of
personal property andJor foreclosure of mortgage with prayer for the issuance of a writ of replevin
and writ of attachment# against :CC and its officers before the .TC
:CC claimed that the contract price was reduced because of outsourcing of different materials and
denied the liability to *D,C since such claim by the latter had been waived# abandoned or
otherwise e)tinguished by the e)ecution of the ,eptember '+# '999 $/A
2owever# *C0C alleged that its obligation under the performance bond was terminated when it
e)pired on /ctober '(# '999 and the e)tension of the performance bond until $arch %# %+++ was
not binding as it was made without its &nowledge and consent
.TC rendered its Decision in favor of *D,C The .TC found :CC guilty of delay when it failed to
finish and turn over the pro1ect on /ctober '(# '999 0t pronounced :CC and *C0C 1ointly and
severally liable and ordered them to pay *D,C the amount of 9#+++#+++++ as damages and
(+#+++++ as attorney-s fees plus interest
"ut CA modified the .TC-s decision The CA agreed that :CC incurred delay in the construction of
the pro1ect 0t# however# found that the computation of the li6uidated damages should be based on
the reduced contract price
ISSUES:
' 3hether or not *C0C is liable for li6uidated damages under the performance bond4
% 3hether or not the ,eptember '+# '999 $/A e)ecuted by *D,C and :CC e)tinguished
*C0C-s liability under the performance bond4
3 3hether or not the amounts of %#!93#+++++ and 88%#C38(+ are deductible from the
li6uidated damages awarded by the CA4
RULINGS:
1. EE,. *aragraph %3 of the "uilding Contract clearly provides a stipulation for the
payment of li6uidated damages in case of delay in the construction of the pro1ect ,uch is
in the nature of a penalty clause fi)ed by the contracting parties as a compensation or
substitute for damages in case of breach of the obligation The contractor is bound to pay
the stipulated amount without need for proof of the e)istence and the measures of
damages caused by the breach
Article %%%8 of the Civil Code allows the parties to a contract to stipulate on li6uidated
damages to be paid in case of breach 0t is attached to an obligation in order to insure
performance and has a double function: ='> to provide for li6uidated damages# and =%> to
strengthen the coercive force of the obligation by the threat of greater responsibility in the
event of breach As a general rule# contracts constitute the law between the parties# and
they are bound by its stipulations :or as long as they are not contrary to law# morals#
good customs# public order# or public policy# the contracting parties may establish such
stipulations# clauses# terms and conditions as they may deem convenient
"y the language of the performance bond issued by *C0C# it guaranteed the full and
faithful compliance by :CC of its obligations in the construction of the *ar& I5 :ly 0n fact#
the primary purpose for the ac6uisition of the performance bond was to guarantee to
*D,C that the pro1ect would proceed in accordance with the terms and conditions of the
contract and to ensure the payment of a sum of money in case the contractor would fail in
the full performance of the contract This guaranty made by *C0C gave *D,C the right to
proceed against it =*C0C> following :CC-s nonHcompliance with its obligation
Thus# suretyship arises upon the solidary binding of a person deemed the surety with the
principal debtor for the purpose of fulfilling an obligation A surety is considered in law as
being the same party as the debtor in relation to whatever is ad1udged touching the
obligation of the latter# and their liabilities are interwoven as to be inseparable
Therefore# as surety# *C0C becomes liable for the debt or duty of :CC although it
possesses no direct or personal interest over the obligations of the latter# nor does it
receive any benefit therefrom
% 5/ Court also found untenable the contention of *C0C that the principal contract was
novated when *D,C and :CC e)ecuted the ,eptember '+# '999 $/A# without informing
the surety# which# in effect# e)tinguished its obligation
A surety agreement has two types of relationship: ='> the principal relationship between
the obligee and the obligorL and =%> the accessory surety relationship between the
principal and the surety The obligee accepts the surety-s solidary underta&ing to pay if
the obligor does not pay ,uch acceptance# however# does not change in any material
way the obligee-s relationship with the principal obligor 5either does it ma&e the surety
an active party in the principal obligorHobligee relationship 0t follows# therefore# that the
acceptance does not give the surety the right to intervene in the principal contract
0n order that an obligation may be e)tinguished by another which substitutes the same# it
is imperative that it be so declared in une6uivocal terms# or that the old and new
obligation be in every point incompatible with each other 5ovation of a contract is never
presumed 0n the absence of an e)press agreement# novation ta&es place only when the
old and the new obligations are incompatible on every point
5o new contract was concluded and perfected between *D,C and :CC A reading of
the ,eptember '+# '999 $/A reveals that only the revision of the wor& schedule
originally agreed upon was the sub1ect thereof The parties saw the need to ad1ust the
wor& schedule because of the various subcontracting made by *D,C 0n fact# it was
specifically stated in the $/A that all oter terms an! con!itions o" te #uil!in$ Contract
o" %& 'anuary ())) not inconsistent ere*it sall remain in "ull "orce an! e""ect. There
was no new contractJagreement which could be considered to have substituted the
"uilding Contract
3. EE, The ruling of the CA on the matter is very clear D whether the value of the securities
given as well as the proceeds of the sale of chattels should be deducted from the claim of
li6uidated damages
STRONGHOL" INSURANCE CO!PAN' vs REPU#LIC(ASAHI GLASS
CORPORATION
(G.R. No. 1)761)
FACTS: A petition for review see&ing to reverse the CA-s decisions that ,0C0-s obligation is not
e)tinguished upon the death of the principal obligor
.epublicHAsahi ;lass Corporation =.epublicHAsahi> entered into a contract with <ose D ,antos#
<r# the proprietor of <D, Construction =<D,># for the construction of roadways and a drainage
system in .epublicHAsahi-s compound in "arrio *inagbuhatan# *asig City amounting to five million
three hundred thousand pesos =*(#3++#+++++> to be completed within a period of two hundred
forty =%?+> days beginning $ay C# '9C9
To guarantee the faithful and satisfactory performance of its underta&ings <D,# shall post a
performance bond of seven hundred ninety five thousand pesos =*!9(#+++++> <D, e)ecuted#
1ointly and severally with ,tronghold 0nsurance Co# 0nc =,0C0>
2owever# the slowness of construction resulted to fear of respondent that construction will not be
finished on the stipulated time and dissatisfied with the performance of <D,# e)tra1udicially
rescinded the contract but letters to <D, informing the demands were unheeded
.espondent then files a complaint against <D, and ,0C0 but report from sheriff stated that <ose
D ,antos# <r died the previous year ='99+># and <D, Construction was no longer at its address
and its whereabouts were un&nown
,0C0 filed its answer# alleging that the @respondent-sA money claims against @petitioner and <D,A
have been e)tinguished by the death of <ose D ,antos# <r Even if this were not the case#
@petitionerA ,0C0 had been released from its liability under the performance bond because there
was no li6uidation# said li6uidation was impossible because of the death of ,antos# who as such
can no longer participate in any li6uidation And was deprived of ,antos- death and the unilateral
rescission of the contract thus deprived the right to protect its interests as surety of the
performance bond D therefore shall be released from all the liability
Bower court issued an order dismissing the complaint of respondent against <D, and ,0C0# on the
ground that the claim against <D, did not survive the death of its sole proprietor# <ose D ,antos#
<r
ISSUE: 3hether petitioner-s liability under the performance bond was automatically e)tinguished
by the death of the principal4
RULING: 5/ CA ruled that ,0C0-s obligation under the surety agreement was not e)tinguished by
the death of <ose D ,antos# <r Conse6uently# .epublicHAsahi could still go after ,0C0 for the
bond
Appellate court also found that the lower court had erred in pronouncing that the performance of
the Contract in 6uestion had become impossible by respondent-s act of rescission The Contract
was rescinded because of the dissatisfaction of respondent with the slow pace of wor& and
pursuant to Article M000 of its Contract with <D,
As a general rule# the death of either the creditor or the debtor does not e)tinguish the obligation
/bligations are transmissible to the heirs# e)cept when the transmission is prevented by the law#
the stipulations of the parties# or the nature of the obligation /nly obligations that are personal or
are identified with the persons themselves are e)tinguished by death
0n the present case# whatever monetary liabilities or obligations ,antos had under his contracts
with respondent were not intransmissible by their nature# by stipulation# or by provision of
law 2ence# his death did not result in the e)tinguishment of those obligations or liabilities# which
merely passed on to his estate Death is not a defense that he or his estate can set up to wipe out
the obligations under the performance bond Conse6uently# petitioner as surety cannot use his
death to escape its monetary obligation under its performance bond
As a surety# petitioner is solidarily liable with ,antos in accordance with the Civil Code articles
%+?! and '%'8
7nder the law and 1urisprudence# respondent may sue# separately or together# the principal debtor
and the petitioner herein# in view of the solidary nature of their liability The death of the principal
debtor will not wor& to convert# decrease or nullify the substantive right of the solidary
creditor Evidently# despite the death of the principal debtor# respondent may still sue petitioner
alone# in accordance with the solidary nature of the latter-s liability under the performance bond
*ILLIA! GOLANGCO CONSTRUCTION CORP. vs PHILIPPINE
CO!!ERCIAL INTERNATIONAL #AN+
=;. 5o '?%C3+>
FACTS: 3illiam ;olangco Construction Corporation =3;CC> and the *hilippine Commercial
0nternational "an& =*C0"> entered into a contract for the construction of the e)tension of *C0"
Tower 00 including the application of a granitite washHout finish
,3-
on the e)terior walls of the
building
To answer for any defect arising within a period of one year# 3;CC submitted a guarantee bond
dated <uly '# '99% issued by $alayan 0nsurance Company# 0nc in compliance with the
construction contract but controversy arose when portions of the granitite washHout finish of the
e)terior of the building began peeling off and falling from the walls wherein 3;CC made some
minor repairs
"ut *C0" end up hiring another contractor to reHdo the entire granitite washHout finish after 3;CC
manifested that it was Fnot in a position to do the new finishing wor&#G though it was willing to share
part of the cost and filed a re6uest for arbitration with the Construction 0ndustry Arbitration
Commission =C0AC> for the reimbursement of its e)penses for the repairs made by another
contractor 0t complained of 3;CC-s alleged nonHcompliance with their contractual terms on
materials and wor&manship
C0AC declared 3;CC liable for the construction defects in the pro1ect 3;CC filed a petition for
review with the Court of Appeals =CA> which dismissed it for lac& of merit
ISSUE: 3hether or not petitioner 3;CC is liable for defects in the granitite washHout finish that
occurred after the lapse of the oneHyear defects liability period provided in Art M0 of the
construction contract4
RULING: 5/ 3e rule in favor of 3;CC As to the Art M0 of construction contract# stated that Fthe
C/5T.ACT/. hereby guarantees the wor& stipulated in this Contract# and shall ma&e good any
defect in materials and wor&manship which @becomesA evident within one ='> year after the final
acceptance of the wor&G
/bligations arising from contracts have the force of law between the parties and should be
complied with in good faith 0n characterizing the contract as having the force of law between the
parties# the law stresses the obligatory nature of a binding and valid agreement
The adoption of a oneHyear guarantee# as done by 3;CC and *C0"# is established usage in the
*hilippines for private and government construction contracts The contract did not specify a
different period for defects in the granitite washHout finishL hence# any defect therein should have
been brought to 3;CC-s attention within the oneHyear defects liability period in the contract
The Article '!'9 of Civil Code clearly stated that: FAcceptance of the wor& by the employer
relieves the contractor of liability for any defect in the wor&# unless: ='> The defect is hidden and
the employer is not# by his special &nowledge# e)pected to recognize the sameL or =%> The
employer e)pressly reserves his rights against the contractor by reason of the defect
Thus# the lower courts con1ectured that the peeling off of the granitite washHout finish was probably
due to Fdefective materials and wor&manshipG This they characterized as hidden or latent defects
was not tenable
:irst# *C0"-s team of e)perts =who were specifically employed to detect such defects early on>
supervised 3;CC-s wor&manship ,econd# 3;CC regularly submitted progress reports and
photographs Third# 3;CC wor&ed under fair and transparent circumstances *C0" had access
to the site and it e)ercised reasonable supervision over 3;CC-s wor& :ourth# *C0" issued
several Fpunch listsG for 3;CC-s compliance before the issuance of *C0"-s final certificate of
acceptance :ifth# *C0" supplied the materials for the granitite washHout finish And finally# *C0"-s
team of e)perts gave their concurrence to the turnover of the pro1ect
7nder the circumstances# there were no hidden defects for which 3;CC could be held liable
5either was there any other defect for which *C0" made any e)press reservation of its rights
against 3;CC
S.o/s0s !ARIANO Z. $ELAR"E 123 A$ELINA ". $ELAR"E vs. COURT OF
APPEALS, "A$I" A. RA'!UN"O 123 GEORGE RA'!UN"O
=;. 5o '+C3?8>
FACTS: David .aymundo is the absolute and registered owner of a parcel of land# together with
the house and other improvements thereon# located at DasmariNas Village# $a&ati ;eorge
.aymundo who negotiated with plaintiffs Avelina and $ariano Velarde for the sale of said
property# which was under lease D and the Deed of ,ale was e)ecuted by David .aymundo# as
vendor# in favor of plaintiff Avelina Velarde# as vendee
*ursuant to said agreements# plaintiffs paid "*0 the monthly interest on the loan secured by the
aforementioned mortgage for three months but on the ?
th
month# plaintiffs were advised that the
Application for Assumption of $ortgage with "*0 was not approved This prompted plaintiffs not to
ma&e any further payment
/n a letter dated <an !# '9C!# plaintiff wrote letter to respondents stating:
Fwillingness to pay the balance in cash not later than <anuary %'# '9C! provided: =a> you deliver
actual possession of the property to her not later than <anuary '(# '9C! for her immediate
occupancyL =b> you cause the release of title and mortgage from the "an& of *0 and ma&e the title
available and free from any liens and encumbrancesL and =c> you e)ecute an absolute deed of
sale in her favor free from any liens or encumbrances not later than <anuary %'# '9C!
"ut the defendants sent plaintiffs a notarial notice of cancellationJrescission of the intended sale of
the sub1ect property allegedly due to the latter-s failure to comply with the terms and conditions of
the Deed of ,ale
*etitioners filed on :ebruary 9# '9C! a Complaint against private respondents for specific
performance# nullity of cancellation# writ of possession and damages but was dismissed 0n a
motion for reconsideration D the decision was reversed ordering the petitioners to pay the balance
of *'C million to private respondents who# in turn# were ordered to e)ecute a deed of absolute
sale
2owever# CA reinstated the former ruling of trial court upholding the validity of rescission made by
the private respondents
CA ruled# the application with "*0 for the approval of the assumption of mortgage would mean
that# in case of approval# payment of the mortgage obligation will now be in the name of
Velarde And in the event said application is disapproved# Velarde had to pay in full
The disapproval by "*0 of the application for assumption of mortgage cannot be used as an
e)cuse for Velarde-s nonHpayment of the balance of the purchase price As borne out by the
evidence# Velarde had to pay in full in case of "*0-s disapproval of the application for assumption
of mortgage and 0t was li&ewise agreed that in case of violation of the mortgage obligation# the
Deed of ,ale with Assumption of $ortgage would be deemed Iautomatically cancelled and of no
further force and effect# as if the same had never been e)ecuted or entered into
ISSUES:
' 3hether or not The Court of Appeals erred in holding that the nonHpayment of the
mortgage obligation resulted in a breach of the contract4
% 3hether or not the Court of Appeals erred in holding that the rescission =resolution> of the
contract by private respondents was 1ustified4
3 3hether or not the Court of Appeals erred in holding that petitioners- <anuary !# '9C!
letter gave three Inew conditions- constituting mere offers or an attempt to novate
necessitating a new agreement between the parties4
RULINGS:
1. 5/ 0n a contract of sale# the seller obligates itself to transfer the ownership of and deliver
a determinate thing# and the buyer to pay therefor a price certain in money or its
e6uivalent *rivate respondents had already performed their obligation through the
e)ecution of the Deed of ,ale# which effectively transferred ownership of the property to
petitioner through constructive delivery *rior physical delivery or possession is not
legally re6uired# and the e)ecution of the Deed of ,ale is deemed e6uivalent to delivery
*etitioners did not perform their correlative obligation of paying the contract price in the
manner agreed upon 3orse# they wanted private respondents to perform obligations
beyond those stipulated in the contract before fulfilling their own obligation to pay the full
purchase price
% 5/ The right of rescission of a party to an obligation under Article ''9' of the Civil Code
is predicated on a breach of faith by the other party who violates the reciprocity between
them The breach contemplated in the said provision is the obligor-s failure to comply with
an e)isting obligation 3hen the obligor cannot comply with what is incumbent upon it#
the obligee may see& rescission and# in the absence of any 1ust cause for the court to
determine the period of compliance# the court shall decree the rescission
0n the present case# private respondents validly e)ercised their right to rescind the
contract# because of the failure of petitioners to comply with their obligation to pay the
balance of the purchase price 0ndubitably# the latter violated the very essence of
reciprocity in the contract of sale# a violation that conse6uently gave rise to private
respondents- right to rescind the same in accordance with law
True# petitioners e)pressed their willingness to pay the balance of the purchase price one
month after it became dueL however# this was not e6uivalent to actual payment as would
constitute a faithful compliance of their reciprocal obligation
2ere# petitioners not only failed to pay the *'C million balance# but they also imposed
upon private respondents new obligations as preconditions to the performance of their
own obligation
.escission creates the obligation to return the ob1ect of the contract 0t can be carried out
only when the one who demands rescission can return whatever he may be obliged to
restore To rescind is to declare a contract void at its inception and to put an end to it as
though it never was 0t is not merely to terminate it and release the parties from further
obligations to each other# but to abrogate it from the beginning and restore the parties to
their relative positions as if no contract has been made
3 5/ ,uffice it to say that the three conditions appearing on the <anuary !# '9C! letter of
petitioners to private respondents were not part of the original contract "y that time# it
was already incumbent upon the former to pay the balance of the sale price They had
no right to demand preconditions to the fulfillment of their obligation# which had become
due
OOO A su+stantial +reac o" a reciprocal o+li$ation, like "ailure to pay te price in te manner
prescri+e! +y te contract, entitles te in,ure! party to rescin! te o+li$ation. -escission
a+ro$ates te contract "rom its inception an! re.uires a mutual restitution o" +ene"its recei/e!. 000
RE'ES vs TUPARAN
=;. 5o 'CC+8?>
FACTS: A petition for review on the decision of CA which affirmed with modification an action for
.escission of Contract with Damages
*etitioner $ila .eyes owns a threeHstorey commercial building in Valenzuela City .espondent#
Victoria Tuparan leased a space on said building for a monthly rental of *?# +++ Aside from being
a tenant# respondent also invested in petitionerPs financing business /n <une %+# '9CC# *etitioner
borrowed *% $illion from :armers ,avings and Boan "an& =:,B "an&> and mortgaged the building
and lot =sub1ect real properties> .eyes decided to sell the property for *8( $illion to li6uidate her
loan and finance her business .espondent offered to conditionally buy the real properties for *?%
$illion on installment basis without interest and to assume the ban& loan The conditions are the
following:
' ,ale will be cancelled if the petitioner can find a buyer of said properties for the
amount of *8( $illion within the ne)t three months All payments made by the
respondent to the petitioner and the ban& will be refunded to Tuparan with an
additional 8K monthly interest
% *etitioner .eyes will continue using the space occupied by her drug store without
rentals for the duration of the installment payments
3 There will be a lease for '( years in favor of .eyes for a monthly rental of *C# +++
after full payment has been made by the defendant
? The defendant will underta&e the renewal and payment of the fire insurance
policies of the % buildings# following the e)piration of the current policies# up to the time
the respondent has fully paid the purchase price
They presented the proposal for Tuparan to assume the mortgage to :,B "an& The ban&
approved on the condition that the petitioner would remain as coHma&er of the mortgage obligation
P04545o2067s 8o240245o2: 7nder their Deed of Conditional ,ale# the respondent is obliged to pay a
lump sum of *'% $illion in three fi)ed installments .espondent# however defaulted in the
payment of the installments To compensate for her delayed payments# respondent agreed to pay
petitioner monthly interest "ut again# respondent failed to fulfill this obligation The petitioner
further alleged that despite her success in finding another buyer according to their conditional sale
agreement# respondent refused to cancel their transaction The respondent also neglected to
renew the fire insurance policy of the buildings
R0s.o230247s 12s906: .espondent alleges that the deed of Conditional ,ale of .eal *roperty
with Assumption of $ortgage was actually a pure and absolute contract of sale with a term period
0t could not be considered a conditional sale because the performance of the obligation therein did
not depend upon a future and uncertain event ,he also averred that she was able to fully pay the
loan and secure the release of the mortgage ,ince she also paid more than the *?% $illion
purchase price# rescission could not be resorted to since the parties could no longer be restored to
their original positions
As the ruling of .TC# also considered the Deed of Conditional ,ale of .eal *roperty with
Assumption of $ortgage e)ecuted by and among the two parties and :,B "an& a contract to sell#
and not a contract of sale 0t was of the opinion that although the petitioner was entitled to a
rescission of the contract# it could not be permitted because her nonHpayment in full of the
purchase price Fmay not be considered as substantial and fundamental breach of the contract as
to defeat the ob1ect of the parties in entering into the contract H which was also affirmed by CA
ISSUE: 3hether or not CA was correct in ruling that there was no legal basis for the rescission of
the Deed of Conditional ,ale with Assumption of $ortgage4
RULING: 5/ The petition was lac& of merit The Court agrees with the ruling of the courts below
that the sub1ect Deed of Conditional ,ale with Assumption of $ortgage entered into by and among
the two parties and :,B "an& on 5ovember %8# '99+ is a contract to sell and not a contract of
sale
The title and ownership of the sub1ect properties remains with the petitioner until the respondent
fully pays the balance of the purchase price and the assumed mortgage obligation Thereafter#
:,B "an& shall then issue the corresponding deed of cancellation of mortgage and the petitioner
shall e)ecute the corresponding deed of absolute sale in favor of the respondent
The petitioner-s obligation to sell the sub1ect properties becomes demandable only upon the
happening of the positive suspensive condition# which is the respondent-s full payment of the
purchase price 3ithout respondent-s full payment# there can be no breach of contract to spea& of
because petitioner has no obligation yet to turn over the title .espondent-s failure to pay in full the
purchase price is not the breach of contract contemplated under Article ''9' of the 5ew Civil
Code but rather 1ust an event that prevents the petitioner from being bound to convey title to the
respondent
As per ruling D e)plained the difference between contract to sell and contract of sale
CONTRACT OF SALE& @Art '?(C CCA "y the contract of sale# one of the contracting parties
obligates himself to transfer the ownership of and to deliver a determinate thing# and the other to
pay therefor a price certain in money or its e6uivalentL
,ale# by its very nature# is a consensual contract because it is perfected by mere
consent The essential elements of a contract of sale are the following:
a> Consent or meeting of the minds# that is# consent to
transfer ownership in e)change for the priceL
b> Determinate sub1ect matterL and
c> *rice certain in money or its e6uivalent
CONTRACT TO SELL& may not be considered as a Contract of ,ale because the first essential
element is lac&ing 0n a contract to sell# the prospective seller e)plicitly reserves the transfer of
title to the prospective buyer# meaning# the prospective seller does not as yet agree or consent to
transfer ownership of the property sub1ect of the contract to sell until the happening of an event#
which for present purposes we shall ta&e as the full payment of the purchase price 3hat the
seller agrees or obliges himself to do is to fulfill his promise to sell the sub1ect property when the
entire amount of the purchase price is delivered to him 0n other words# the full payment of the
purchase price parta&es of a suspensive condition# the nonHfulfillment of which prevents the
obligation to sell from arising and# thus# ownership is retained by the prospective seller without
further remedies by the prospective buyer
A contract to sell may thus be defined as a bilateral contract whereby the prospective
seller# while e)pressly reserving the ownership of the sub1ect property despite delivery
thereof to the prospective buyer# binds himself to sell the said property e)clusively to the
prospective buyer upon fulfillment of the condition agreed upon# that is# full payment of
the purchase price
OOO 0n this case# the contract entitled FDeed of Conditional ,aleG is actually a contract to
sell and there can be no rescission of an obligation =to turn over title> that did not yet e)ist
since the suspensive condition had not ta&en place OOO
LAN" #AN+ OF THE PHILS vs ONG
=;. 5o '9+!((>
FACTS: ,pouses <ohnson and Evangeline ,y secured a loan from Band "an& Begazpi City in the
amount of *h* '8 million The loan was secured by three =3> residential lots# five =(> cargo truc&s#
and a warehouse 7nder the loan agreement# *h* 8 million of the loan would be shortHterm and
would mature on :ebruary %C# '99!# while the balance of *h* '+ million would be payable in
seven =!> years and any default in payment of amortizations or other charges would accelerate
the maturity of the loan
,pouses ,y found they could no longer pay their loan /n December 9# '998# they sold three =3>
of their mortgaged parcels of land for *h* '(+#+++ to Angelina ;loria /ng# Evangeline-s mother#
under a Deed of ,ale with Assumption of $ortgage
Alfredo /ng immediately went to Band "an& to inform it about the sale and assumption of
mortgage and was informed to pay !(+# +++ pesos so the assumption of mortgage could easily
be approved so as the transfer of certificate of title in his name
Alfredo later found out that his application for assumption of mortgage was not approved by Band
"an& due to credit investigation and only learned of the foreclosure when he saw the sub1ect
mortgage properties included in a 5otice of :oreclosure of $ortgage and Auction ,ale at the .TC
in Tabaco# Albay
Alfredo /ng filed a case for recovery of sum of money plus damages and said that Band "an&-s
foreclosure without informing him of the denial of his assumption of the mortgage was done in bad
faith and that he was made to believed that *!(+#+++ would cause Band "an& to approve his
assumption to the mortgage
.TC held that the contract approving the assumption of mortgage was not perfected as a result of
the credit investigation conducted on Alfredo 0t noted that Alfredo was not even informed of the
disapproval of the assumption of mortgage but was 1ust told that the accounts of the spouses ,y
had matured and gone unpaid /rdering ban& to pay /ng the amount of !(+# +++ pesos with '%K
interest per annum
CA affirmed the decision of .TC
ISSUES:
' 3hether or not the Court of Appeals erred in holding that Art '%38 of the
Civil Code does not apply and in finding that there is novation4
% 3hether or not the Court of Appeals misconstrued the evidence and the law
when it affirmed the trial court decision-s ordering Band "an& to pay /ng the
amount of *hp!(+#+++++ with interest at '%K annum4
RULINGS:
' EE, 3e agree with Band "an& on this point as to the first part of paragraph ' of
Art '%38 Band "an& was not bound to accept Alfredo-s payment# since as far as
the former was concerned# he did not have an interest in the payment of the loan of
the ,pouses ,y 2owever# in the conte)t of the second part of said paragraph#
Alfredo was not ma&ing payment to fulfill the obligation of the ,pouses ,y Alfredo
made a conditional payment so that the properties sub1ect of the Deed of ,ale with
Assumption of $ortgage would be titled in his name 0t is clear from the records that
Band "an& re6uired Alfredo to ma&e payment before his assumption of mortgage
would be approved 2e was informed that the certificate of title would be transferred
accordingly 2e# thus# made payment not as a debtor but as a prospective
mortgagor
5ovation would have dual functions Q one to e)tinguish an e)isting obligation# the
other to substitute a new one in its place Q re6uiring a conflu) of four essential
re6uisites: ='> a previous valid obligationL =%> an agreement of all parties concerned
to a new contractL =3> the e)tinguishment of the old obligationL and =?> the birth of a
valid new obligation
3e do not agree# then# with the CA in holding that there was a novation in the
contract between the parties 5ot all the elements of novation were
present 5ovation must be e)pressly consented to $oreover# the conflicting
intention and acts of the parties underscore the absence of any e)press disclosure
or circumstances with which to deduce a clear and une6uivocal intent by the parties
to novate the old agreement
% 5/ Band "an& is still liable for the return of the *h* !(+#+++ based on the principle
of un1ust enrichment Band "an& is correct in arguing that it has no obligation as
creditor to recognize Alfredo as a person with interest in the fulfillment of the
obligation "ut while Band "an& is not bound to accept the substitution of debtors in
the sub1ect real estate mortgage# it is estopped by its action of accepting Alfredo-s
payment from arguing that it does not have to recognize Alfredo as the new debtor
3e turn then on the principle upon which Band "an& must return Alfredo-s payment
7n1ust enrichment e)ists Fwhen a person un1ustly retains a benefit to the loss of
another# or when a person retains money or property of another against the
fundamental principles of 1ustice# e6uity and good conscienceG
@'CA
There is un1ust
enrichment under Art %% of the Civil Code when ='> a person is un1ustly benefited#
and =%> such benefit is derived at the e)pense of or with damages to another
HEIRS OF PAULINO ATIENZA vs ESPI"OL
(G.R. No. 18066)
FACTS& *etitioners owned a registered agricultural land at Cabanatuan City which they
have ac6uired under emancipation patent thru land reform program
/n August '%# %++% the Atienzas and respondent Domingo * Espidol entered into a
contract called 1asun!uan sa Pa$+i+ili n$ 2upa na may Paunan$3#aya! =contract to sell
land with a down payment> covering the property They agreed on a price of *'3+++ per
s6uare meter or a total of *%#C(?#8!+++# payable in three installments:*'++#+++++ upon
the signing of the contractL *'#!(+#+++++ in December %++%# and the
remaining *9!?#8!+++ in <une %++3
2owever# respondents failed to pay the second installment resulted to the action of the
petitioner to annul the contract because of breached of obligation
.espondent argued that his failure to pay did not amount to breach since the nonH
payment of an installment is not a legal ground for annulling a perfected contract of sale
.TC ruled# inasmuch as the nonHpayment of the purchase price was not considered a breach in a
contract to sell on installment but only an event that authorized the vendor not to convey title any
attempt by the Atienzas to cancel the contract would have to comply with the provisions of
.epublic Act =.A> 8((% or the .ealty 0nstallment "uyer *rotection Act =.A 8((%># particularly
the giving of the re6uired notice of cancellation# that they omitted in this case The .TC thus
declared the contract between the parties valid and subsisting and ordered the parties to comply
with its terms and conditions
CA affirmed the decision of .TC
ISSUES:
' 3hether or not the Atienzas could validly sell to respondent Espidol the sub1ect land
which they ac6uired through land reform under *residential Decree %!
@'(A
=*D %!>4
% 3hether or not the Atienzas were entitled to the cancellation of the contract to sell
they entered into with respondent Espidol on the ground of the latter-s failure to pay
the second installment when it fell due4
3 3hether or not the Atienzas- action for cancellation of title was premature absent the
notarial notice of cancellation re6uired by .A 8((%4
RULINGS:
' EE, The Atienzas- title shows on its face that the government granted title to them
on <anuary 9# '99+ by virtue of *D %! This law e)plicitly prohibits any form of
transfer of the land granted under it e)cept to the government or by hereditary
succession to the successors of the farmer beneficiary
7pon the enactment of E)ecutive /rder %%C in '9C!# however# the restriction ceased
to be absolute Band reform beneficiaries were allowed to transfer ownership of their
lands provided that their amortizations with the Band "an& of the *hilippines =Band
"an&> have been paid in full 0n this case# the Atienzas- title categorically states that
they have fully complied with the re6uirements for the final grant of title under *D
%! This means that they have completed payment of their amortization with Band
"an& Conse6uently# they could already legally transfer their title to another
% EE, 0n the first place# since Espidol failed to pay the installment on a day certain
fi)ed in their agreement# the Atienzas can afterwards validly cancel and ignore the
contract to sell because their obligation to sell under it did not arise ,ince the
suspensive condition did not arise# the parties stood as if the conditional obligation
had never e)isted
,econdly# it was not a pure suspensive condition in the sense that the Atienzas
made no underta&ing while the installments were not yet due
Although the Atienzas filed their action with the .TC four months before the last
installment of *9!?#8!+++ fell due in <une %++3# it cannot be said that the action
was premature ;iven Espidol-s failure to pay the second installment
of *'#!(+#+++++ in December %++% when it was due# the Atienzas- obligation to turn
over ownership of the property to him may be regarded as no longer e)isting
@%?A
The
Atienzas had the right to see& 1udicial declaration of such nonHe)istent status of that
contract to relieve themselves of any liability should they decide to sell the property
to someone else
3 5/ 5otice of cancellation by notarial act need not be given before the contract
between the Atienzas and respondent Espidol may be validly declare nonH
e)istent .A 8((% which mandated the giving of such notice does not apply to this
case The cancellation envisioned in that law pertains to e)tra1udicial cancellation or
one done outside of court#
,2-
which is not the mode availed of here The Atienzas
came to court to see& the declaration of its obligation under the contract to sell
cancelled Thus# the absence of that notice does not bar the filing of their action
AGRIFINA A:UINTE' vs SPOUSES FELICI"A" AN" RICO TI#ONG
(G.R. No. 16670))
FACTS: *etitioner Agrifina A6uintey filed before the .TC of "aguio City# a complaint for sum of
money and damages against the respondents# spouses :elicidad and .ico Tibong Agrifina
alleged that :elicidad had secured loans from her on several occasions# at monthly interest rates
of 8K to !K Despite demands# the spouses Tibong failed to pay their outstanding loan#
amounting to *!!3#+++++ e)clusive of interests
.espondents failed to pay the amount of !!3# +++ pesos despite of demands ,o as the chec&
issued by the respondents for partial payment was dishonored due to insufficient funds
:elicidad presented copies of promissory notes but have lost some of the receipts sigend by the
respondent 2owever# :elicidad admitted that they had secured loans from the petitioner and that
were reHlent to other borrowers for a much higher interest
An assistance of Atty AHayo was hired by the petitioner to collect the sum of money and was
advised that respondent debtor-s e)ecute a promissory notes in favor of the petitioner for the
purpose of turning over their loans from respondent
The Deed of E)ecution in the assignment of credits was transferred and assigned to the petitioner
2owever# when he tried to collect the balance on respondents# :elicidad told her to wait until her
debtor-s payment will due
*etitioner then filed a complaint wherein trial court rendered its Decision in favor of Agrifina .TC
ruled:
The trial court ruled that :elicidad-s obligation had not been novated by the deeds of assignment
and the promissory notes e)ecuted by :elicidad-s borrowers 0t e)plained that the documents did
not contain any e)press agreement to novate and e)tinguish :elicidad-s obligation 0t declared that
the deeds and notes were separate contracts which could stand alone from the original
indebtedness of :elicidad. Considering# however# Agrifina-s admission that she was able to collect
from :elicidad-s debtors the total amount of*3+'#+++++# this should be deducted from the latter-s
accountability 2ence# the balance# e)clusive of interests# amounted to *?!%#+++++
CA affirmed the decision of the .TC with modification The appellate court sustained the trial
court-s ruling that :elicidad-s obligation to Agrifina had not been novated by the deeds of
assignment and promissory notes e)ecuted in the latter-s favor
ISSUE: 3hether or not the obligation of respondents to pay the balance of their loans# including
interest# was partially e)tinguished by the e)ecution of the deeds of assignment in favor of
petitioner4
RULING: EE, There is no longer a need for the Court to still resolve the issue of whether
respondents- obligation to pay the balance of their loan account to petitioner was partially
e)tinguished by the promissory notes e)ecuted by <uliet Tibong# Corazon Dalisay# .ita
Chomacog# Carmelita Casuga# $erlinda ;elacio and Antoinette $anuel because# as admitted by
petitioner# she was able to collect the amounts under the notes from said debtors and applied
them to respondents- accounts
7nder Article '%3'=b> of the 5ew Civil Code# novation is enumerated as one of the ways by which
obligations are e)tinguished /bligations may be modified by changing their ob1ect or principal
creditor or by substituting the person of the debtor The burden to prove the defense that an
obligation has been e)tinguished by novation falls on the debtor
5ovation which consists in substituting a new debtor =!ele$a!o> in the place of the original one
=!ele$ante> may be made even without the &nowledge or against the will of the latter but not
without the consent of the creditor ,ubstitution of the person of the debtor may be effected
by !ele$acion# meaning# the debtor offers# and the creditor =!ele$atario># accepts a third person
who consents to the substitution and assumes the obligation Thus# the consent of those three
persons is necessary 0n this &ind of novation# it is not enough to e)tend the 1uridical relation to a
third personL it is necessary that the old debtor be released from the obligation# and the third
person or new debtor ta&e his place in the relation 3ithout such release# there is no novationL the
third person who has assumed the obligation of the debtor merely becomes a coHdebtor or a
surety 0f there is no agreement as to solidarity# the first and the new debtor are considered
obligated 1ointly
3e find in this case that the CA correctly found that respondents- obligation to pay the balance of
their account with petitioner was e)tinguished# pro tanto# by the deeds of assignment of credit
e)ecuted by respondent :elicidad in favor of petitioner
$ILLA!AR vs !ANGAOIL
(G.R. No. 188661)
FACTS& Villamar is the registered owner of a 38+C+ hectares parcel of land in ,an :rancisco#
$anuel# 0sabela covered by Transfer Certificate of Title =TCT> 5o TH9%9(CHA /n $arch 3+# '99C#
she entered into an Agreement with $angaoil for the purchase and sale of said parcel of land for a
total selling price of 83+# +++ pesos
The parties e)ecuted a Deed of Absolute ,ale whereby Villamar transferred the sub1ect parcel of
land to $angaoil for and in consideration of @*A'(+#+++++
2owever# $angaoil informed Villamar that he was bac&ing out from the sale agreed upon giving
as one of the reasons that the area is not yet fully cleared by incumbrances as there are tenants
who are not willing to vacate the land without giving them bac& the amount that they mortgaged
the landG D and filed a case before .TC for tne rescission of contract against the petitioner
.TC then ordered the rescission of the agreement and the deed of absolute sale e)ecuted
between the respondent and the petitioner .TC ruled# As such# in a contract of sale# the
obligation of the vendee to pay the price is correlative of the obligation of the vendor to deliver the
thing sold 0t created or established at the same time# out of the same course# and which result in
mutual relations of creditor and debtor between the parties
The claim of the plaintiff that the BA5D has not been delivered to him was not refuted by the
defendant Considering that defendant failed to deliver to him the certificate of title and of the
possession over the BA5D to the plaintiff# the contract must be rescinded pursuant to Article ''9'
of the Civil Code D .TC further e)plained
*etitioner applead to CA but was dismissed
ISSUE: 3hether or not the failure of the petitioner to deliver to the respondent both the physical
possession of the sub1ect property and the certificate of title covering the same amount to a
substantial breach of the formerPs obligations to the latter constituting a valid cause to rescind the
agreement and deed of sale entered into by the parties4
RULING: 5/ The .TC and the CA both found that the petitioner failed to comply with her
obligations to deliver to the respondent both the possession of the sub1ect property and the
certificate of title covering the same
Although Articles '?(C# '?9( and '?9C of the 5CC and case law do not generally re6uire the
seller to deliver to the buyer the physical possession of the property sub1ect of a contract of sale
and the certificate of title covering the same# the agreement entered into by the petitioner and the
respondent provides otherwise 2owever# the terms of the agreement cannot be considered as
violative of law# morals# good customs# public order# or public policy# hence# valid
3e agree with the .TC and the CA that the petitioner failed to prove that she delivered the TCT
covering the sub1ect property to the respondent 3hat the petitioner attempted to establish was
that she gave the TCT to Atty Antonio whom she alleged was commissioned to effect the transfer
of the title in the respondentPs name Although Atty AntonioPs e)istence is certain as he was the
petitioner-s counsel in the proceedings before the .TC# there was no proof that the former indeed
received the TCT or that he was commissioned to process the transfer of the title in the
respondentPs name
5otwithstanding the absence of stipulations in the agreement and absolute deed of sale entered
into by Villamar and $angaoil e)pressly indicating the conse6uences of the formerPs failure to
deliver the physical possession of the sub1ect property and the certificate of title covering the
same# the latter is entitled to demand for the rescission of their contract pursuant to Article ''9'
of the 5CC
Article ''9' of the 5CC is clear that Fthe power to rescind obligations is implied in reciprocal ones#
in case one of the obligors should not comply with what is incumbent upon himG The respondent
cannot be deprived of his right to demand for rescission in view of the petitioner-s failure to abide
with item nos % and 3 of the agreement This remains true notwithstanding the absence of
e)press stipulations in the agreement indicating the conse6uences of breaches which the parties
may commit To hold otherwise would render Article ''9' of the 5CC as useless
Article '?9C of the 5CC generally considers the e)ecution of a public instrument as constructive
delivery by the seller to the buyer of the property sub1ect of a contract of sale The case at bar#
however# falls among the e)ceptions to the foregoing rule since a mere presumptive and not
conclusive delivery is created as the respondent failed to ta&e material possession of the sub1ect
property
.TC and the CA found that the petitioner failed to deliver to the respondent the possession of the
sub1ect property due to the continued presence and occupation of *arangan and Bacaden 3e find
no ample reason to reverse the said findings Considered in the light of either the agreement
entered into by the parties or the pertinent provisions of law# the petitioner failed in her underta&ing
to deliver the sub1ect property to the respondent