Professional Documents
Culture Documents
February 9, 2007
AMELIA
S.
vs.
MARTIN B. PAPIO, Respondent.
On July 6, 1982, TCT No. S-44980 was cancelled, and TCT No. 114478 was issued in
the name of Amelia Roberts as owner.7
ROBERTS, Petitioner,
Martin Papio paid the rentals from May 1, 1982 to May 1, 1984, and thereafter, for
another year.8 He then failed to pay rentals, but he and his family nevertheless
remained in possession of the property for a period of almost thirteen (13) years.
DECISION
CALLEJO, SR., J.:
Assailed in this petition for review on certiorari is the Decision1 of the Court of Appeals
(CA), in CA-G.R. CV No. 69034 which reversed and set aside the Decision2 of the
Regional Trial Court (RTC), Branch 150, Makati City, in Civil Case No. 01-431. The
RTC ruling had affirmed with modification the Decision3 of the Metropolitan Trial Court
(MeTC), Branch 64, Makati City in Civil Case No. 66847. The petition likewise assails
the Resolution of the CA denying the motion for reconsideration of its decision.
The Antecedents
The spouses Martin and Lucina Papio were the owners of a 274-square-meter
residential lot located in Makati (now Makati City) and covered by Transfer Certificate
of Title (TCT) No. S-44980.4 In order to secure aP59,000.00 loan from the Amparo
Investments Corporation, they executed a real estate mortgage on the property. Upon
Papios failure to pay the loan, the corporation filed a petition for the extrajudicial
foreclosure of the mortgage.
Since the couple needed money to redeem the property and to prevent the
foreclosure of the real estate mortgage, they executed a Deed of Absolute Sale over
the property on April 13, 1982 in favor of Martin Papios cousin, Amelia Roberts. Of
the P85,000.00 purchase price, P59,000.00 was paid to the Amparo Investments
Corporation, while the P26,000.00 difference was retained by the spouses. 5 As soon
as the spouses had settled their obligation, the corporation returned the owners
duplicate of TCT No. S-44980, which was then delivered to Amelia Roberts.
Thereafter, the parties (Amelia Roberts as lessor and Martin Papio as lessee)
executed a two-year contract of lease dated April 15, 1982, effective May 1, 1982.
The contract was subject to renewal or extension for a like period at the option of the
lessor, the lessee waiving thereby the benefits of an implied new lease. The lessee
was obliged to pay monthly rentals of P800.00 to be deposited in the lessors account
at the Bank of America, Makati City branch.6
In a letter dated June 3, 1998, Amelia Roberts, through counsel, reminded Papio that
he failed to pay the monthly rental of P2,500.00 from January 1, 1986 to December
31, 1997, and P10,000.00 from January 1, 1998 to May 31, 1998; thus, his total
liability was P410,000.00. She demanded that Papio vacate the property within 15
days from receipt of the letter in case he failed to settle the amount. 9 Because he
refused to pay, Papio received another letter from Roberts on April 22, 1999,
demanding, for the last time, that he and his family vacate the property.10 Again, Papio
refused to leave the premises.
On June 28, 1999, Amelia Roberts, through her attorney-in-fact, Matilde Aguilar, filed
a Complaint11 for unlawful detainer and damages against Martin Papio before the
MeTC, Branch 64, Makati City. She alleged the following in her complaint:
Sometime in 1982 she purchased from defendant a 274-sq-m residential house and
lot situated at No. 1046 Teresa St., Brgy. Valenzuela, Makati City. 12 Upon Papios
pleas to continue staying in the property, they executed a two-year lease
contract13 which commenced on May 1, 1982. The monthly rental was P800.00.
Thereafter, TCT No. 11447814 was issued in her favor and she paid all the realty taxes
due on the property. When the term of the lease expired, she still allowed Papio and
his family to continue leasing the property. However, he took advantage of her
absence and stopped payment beginning January 1986, and refused to pay despite
repeated demands. In June 1998, she sent a demand letter 15 through counsel
requiring Papio to pay rentals from January 1986 up to May 1998 and to vacate the
leased property. The accumulated arrears in rental are as follows: (a)P360,000.00
from January 1, 1986 to December 31, 1997 at P2,500.00 per month; and
(b) P50,000.00, from January 1, 1998 to May 31, 1998 at P10,000.00 per
month.16 She came to the Philippines but all efforts at an amicable settlement proved
futile. Thus, in April 1999, she sent the final demand letter to defendant directing him
and his family to pay and immediately vacate the leased premises.17
Roberts appended to her complaint copies of the April 13, 1982 Deed of Absolute
Sale, the April 15, 1982 Contract of Lease, and TCT No. 114478.
In his Answer with counterclaim, Papio alleged the following:
Papio asserted that the letters of Roberts and her husband are in themselves
admissions or declarations against interest, hence, admissible to prove that he had
reacquired the property although the title was still in her possession.
In her Affidavit and Position Paper,23 Roberts averred that she had paid the real estate
taxes on the property after she had purchased it; Papios initial right to occupy the
property was terminated when the original lease period expired; and his continued
possession was only by mere tolerance. She further alleged that the Deed of Sale
states on its face that the conveyance of the property was absolute and unconditional.
She also claimed that any right to repurchase the property must appear in a public
document pursuant to Article 1358, Paragraph 1, of the Civil Code of the
Phililppines.24 Since no such document exists, defendants supposed real interest
over the property could not be enforced without violating the Statute of Frauds. 25 She
stressed that her Torrens title to the property was an "absolute and indefeasible
evidence of her ownership of the property which is binding and conclusive upon the
whole world."
Roberts admitted that she demanded P39,000.00 from the defendant in her letter
dated July 25, 1986. However, she averred that the amount represented his back
rentals on the property.26 She declared that she neither authorized Ventura to sell the
property nor to receive the purchase price therefor. She merely authorized her to
receive the rentals from defendant and to deposit them in her account. She did not
know that Ventura had received P250,000.00 from Papio in July 1985 and on June
16, 1986, and had signed receipts therefor. It was only on February 11, 1998 that she
became aware of the receipts when she received defendant Papios letter to which
were appended the said receipts. She and her husband offered to sell the property to
the defendant in 1984 for US$15,000.00 on a "take it or leave it" basis when they
arrived in the Philippines in May 1984. 27However, defendant refused to accept the
offer. The spouses then offered to sell the property anew on December 20, 1997,
for P670,000.00 inclusive of back rentals.28 However, defendant offered to settle his
account with the spouses.29 Again, the offer came on January 11, 1998, but it was
rejected. The defendant insisted that he had already purchased the property in July
1985 for P250,000.00.
Roberts insisted that Papios claim of the right to repurchase the property, as well as
his claim of payment therefor, is belied by his own letter in which he offered to settle
plaintiffs claim for back rentals. Even assuming that the purchase price of the
property had been paid through Ventura, Papio did not adduce any proof to show that
Ventura had been authorized to sell the property or to accept any payment thereon.
Any payment to Ventura could have no binding effect on her since she was not privy
to the transaction; if at all, such agreement would be binding only on Papio and
Ventura.
upon the expiration of the one-year period from the date of issue," and that a Torrens
title, "which enjoys a strong presumption of regularity and validity, is generally a
conclusive evidence of ownership of the land referred to therein."
As to Papios claim that the transfer of the property was one with right of repurchase,
the MeTC held it to be bereft of merit since the Deed of Sale is termed as "absolute
and unconditional." The court ruled that the right to repurchase is not a right granted
to the seller by the buyer in a subsequent instrument but rather, a right reserved in the
same contract of sale. Once the deed of absolute sale is executed, the seller can no
longer reserve the right to repurchase; any right thereafter granted in a separate
document cannot be a right of repurchase but some other right.
As to the receipts of payment signed by Ventura, the court gave credence to
Robertss declaration in her Affidavit that she authorized Ventura only to collect
rentals from Papio, and not to receive the repurchase price. Papios letter of January
31, 1998, which called her attention to the fact that she had been sending people
without written authority to collect money since 1985, bolstered the courts finding that
the payment, if at all intended for the supposed repurchase, never redounded to the
benefit of the spouses Roberts.
Papio appealed the decision to the RTC, alleging the following:
I.
THE LOWER COURT GRAVELY ERRED IN NOT DISMISSING THE CASE FOR
EJECTMENT OUTRIGHT ON THE GROUND OF LACK OF CAUSE OF ACTION.
SO ORDERED.31
The MeTC held that Roberts merely tolerated the stay of Papio in the property after
the expiration of the contract of lease on May 1, 1984; hence, she had a cause of
action against him since the only elements in an unlawful detainer action are the fact
of lease and the expiration of its term. The defendant as tenant cannot controvert the
title of the plaintiff or assert any right adverse thereto or set up any inconsistent right
to change the existing relation between them. The plaintiff need not prove her
ownership over the property inasmuch as evidence of ownership can be admitted
only for the purpose of determining the character and extent of possession, and the
amount of damages arising from the detention.
The court further ruled that Papio made no denials as to the existence and
authenticity of Roberts title to the property. It declared that "the certificate of title is
indefeasible in favor of the person whose name appears therein and incontrovertible
II.
THE LOWER COURT GRAVELY ERRED IN NOT CONSIDERING THE
DOCUMENTARY EVIDENCE ADDUCED BY DEFENDANT-APPELLANT WHICH
ESTABLISHED THAT A REPURCHASE TRANSACTION EXISTED BETWEEN THE
PARTIES ONLY THAT PLAINTIFF-APPELLEE WITHHELD THE EXECUTION OF
THE ABSOLUTE DEED OF SALE AND THE TRANSFER OF TITLE OF THE SAME
IN DEFENDANT-APPELLANTS NAME.
III.
THE LOWER COURT GRAVELY ERRED IN NOT CONSIDERING THAT THE
LETTERS OF PLAINTIFF-[APPELLEE] AND OF HER HUSBAND ADDRESSED TO
DEFENDANT-APPELLANT AND HIS WIFE ARE IN THEMSELVES ADMISSION
SO ORDERED.37
Both parties filed their respective motions for reconsideration.38 In an Order39 dated
February 26, 2002, the court denied the motion of Papio but modified its decision
declaring that the computation of the accrued rentals should commence from January
1986, not January 1996. The decretal portion of the decision reads:
Wherefore, the challenged decision dated January 18, 2001 is hereby affirmed with
modification that defendant pay plaintiff the reasonable rentals accrued for the period
January 1, 1986 to December [31, 1997] per month and thereafter and P10,000.00
[per month] from January 1998 to October 28, 2001 when defendant-appellant
actually vacated the subject leased premises.
SO ORDERED.40
Papio maintained that Roberts had no cause of action for eviction because she had
already ceded her right thereto when she allowed him to redeem and reacquire the
property upon payment of P250,000.00 to Ventura, her duly authorized
representative. He also contended that Robertss claim that the authority of Ventura is
limited only to the collection of the rentals and not of the purchase price was a mere
afterthought, since her appended Affidavit was executed sometime in October 1999
when the proceedings in the MeTC had already started.
On March 26, 2001, Roberts filed a Motion for Issuance of Writ of Execution. 33 The
court granted the motion in an Order34 dated June 19, 2001. Subsequently, a Writ of
Execution35 pending appeal was issued on September 28, 2001. On October 29,
2001, Sheriff Melvin M. Alidon enforced the writ and placed Roberts in possession of
the property.
Meanwhile, Papio filed a complaint with the RTC of Makati City, for specific
performance with damages against Roberts. Papio, as plaintiff, claimed that he
entered into a contract of sale with pacto de retro with Roberts, and prayed that the
latter be ordered to execute a Deed of Sale over `the property in his favor and
transfer the title over the property to and in his name. The case was docketed as Civil
Case No. 01-851.
On October 24, 2001, the RTC rendered judgment affirming the appealed decision of
the MeTC. The fallo of the decision reads:36
Being in accordance with law and the circumstances attendant to the instant case, the
court finds merit in plaintiff-appellees claim. Wherefore, the challenged decision
dated January 18, 2001 is hereby affirmed in toto.
On February 28, 2002, Papio filed a petition for review 41 in the CA, alleging that the
RTC erred in not finding that he had reacquired the property from Roberts
for P250,000.00, but the latter refused to execute a deed of absolute sale and transfer
the title in his favor. He insisted that the MeTC and the RTC erred in giving credence
to petitioners claim that she did not authorize Ventura to receive his payments for the
purchase price of the property, citing Roberts letter dated July 25, 1986 and the letter
of Eugene Roberts to Ventura of even date. He also averred that the MeTC and the
RTC erred in not considering his documentary evidence in deciding the case.
On August 31, 2004, the CA rendered judgment granting the petition. The appellate
court set aside the decision of the RTC and ordered the RTC to dismiss the
complaint. The decretal portion of the Decision42 reads:
WHEREFORE, the judgment appealed from is hereby REVERSED and SET ASIDE
and a new one entered: (1) rendering an initial determination that the "Deed of
Absolute Sale" dated April 13, 1982 is in fact an equitable mortgage under Article
1603 of the New Civil Code; and (2) resolving therefore that petitioner Martin B. Papio
is entitled to possession of the property subject of this action; (3) But such
determination of ownership and equitable mortgage are not clothed with finality and
will not constitute a binding and conclusive adjudication on the merits with respect to
the issue of ownership and such judgment shall not bar an action between the same
parties respecting title to the land, nor shall it be held conclusive of the facts therein
found in the case between the same parties upon a different cause of action not
involving possession. All other counterclaims for damages are hereby dismissed.
Cost against the respondent.
SO ORDERED.43
consequently, petitioner was obliged to execute a deed of absolute sale over the
property in his favor.
Notably, respondent alleged that, as stated in his letter to petitioner, he was given the
right to reacquire the property in 1982 within two years upon the payment
of P53,000.00, plus petitioners airfare for her trip to the Philippines from the USA and
back;
petitioner
promised
to
sign
the
deed
of absolute sale. He even filed a complaint against the petitioner in the RTC,
docketed as Civil Case No. 01-851, for specific performance with damages to compel
petitioner to execute the said deed of absolute sale over the property presumably on
the strength of Articles 1357 and 1358 of the New Civil Code. Certainly then, his claim
that petitioner had given him the right to repurchase the property is antithetical to an
equitable mortgage.
An equitable mortgage is one that, although lacking in some formality, form or words,
or other requisites demanded by a statute, nevertheless reveals the intention of the
parties to change a real property as security for a debt and contain nothing impossible
or contrary to law.49 A contract between the parties is an equitable mortgage if the
following requisites are present: (a) the parties entered into a contract denominated
as a contract of sale; and (b) the intention was to secure an existing debt by way of
mortgage.50 The decisive factor is the intention of the parties.
In an equitable mortgage, the mortgagor retains ownership over the property but
subject to foreclosure and sale at public auction upon failure of the mortgagor to pay
his obligation.51 In contrast, in a pacto de retro sale, ownership of the property sold is
immediately transferred to the vendee a retro subject only to the right of the vendor a
retro to repurchase the property upon compliance with legal requirements for the
repurchase. The failure of the vendor a retro to exercise the right to repurchase within
the agreed time vests upon the vendee a retro, by operation of law, absolute title over
the property.52
One repurchases only what one has previously sold. The right to repurchase
presupposes a valid contract of sale between the same parties. 53 By insisting that he
had repurchased the property, respondent thereby admitted that the deed of absolute
sale executed by him and petitioner on April 13, 1982 was, in fact and in law, a deed
of absolute sale and not an equitable mortgage; hence, he had acquired ownership
over the property based on said deed. Respondent is, thus, estopped from asserting
that the contract under the deed of absolute sale is an equitable mortgage unless
there is allegation and evidence of palpable mistake on the part of respondent;54 or a
fraud on the part of petitioner. Respondent made no such allegation in his pleadings
and affidavit. On the contrary, he maintained that petitioner had sold the property to
him in July 1985 and acknowledged receipt of the purchase price thereof except the
and distinct from the right of repurchase that must be reserved by means of
stipulations to that effect in the contract of sale.63
There is no evidence on record that, on or before July 1985, petitioner agreed to sell
her property to the respondent for P250,000.00. Neither is there any documentary
evidence showing that Ventura was authorized to offer for sale or sell the property for
and in behalf of petitioner for P250,000.00, or to receive the said amount from
respondent as purchase price of the property. The rule is that when a sale of a piece
of land or any interest therein is through an agent, the authority of the latter shall be in
writing; otherwise, the sale shall be void64 and cannot produce any legal effect as to
transfer the property from its lawful owner.65 Being inexistent and void from the very
beginning, said contract cannot be ratified.66 Any contract entered into by Ventura for
and in behalf of petitioner relative to the sale of the property is void and cannot be
ratified by the latter. A void contract produces no effect either against or in favor of
anyone.67
Respondent also failed to prove that the negotiations between him and petitioner has
culminated in his offer to buy the property for P250,000.00, and that they later on
agreed to the sale of the property for the same amount. He likewise failed to prove
that he purchased and reacquired the property in July 1985. The evidence on record
shows that petitioner had offered to sell the property for US$15,000 on a "take it or
leave it" basis in May 1984 upon the expiration of the Contract of Lease 68 an offer
that was rejected by respondentwhich is why on December 30, 1997, petitioner and
her husband offered again to sell the property to respondent for P670,000.00
inclusive of back rentals and the purchase price of the property under the April 13,
1982 Deed of absolute Sale.69The offer was again rejected by respondent. The final
offer appears to have been made on January 11, 1998 70but again, like the previous
negotiations, no contract was perfected between the parties.
A contract is a meeting of minds between two persons whereby one binds himself,
with respect to the other, to give something or to render some service.71 Under Article
1318 of the New Civil Code, there is no contract unless the following requisites
concur:
(1) Consent of the contracting parties;
(2) Object certain which is the subject matter of the contract;
Regards,
Amie 79
We have carefully considered the letter of Perlita Ventura, dated July 18, 1986, and
the letter of Eugene Roberts, dated July 25, 1986, where Ventura admitted having
used the money of petitioner amounting to P39,000.00 without the latters knowledge
for the plane fare of Venturas parents. Ventura promised to refund the amount
ofP39,000.00, inclusive of interests, within one year.80 Eugene Roberts berated
Ventura and called her a thief for stealing his and petitioners money and that of
respondents wife, Ising, who allegedly told petitioner that she, Ising, loaned the
money to her parents for their plane fare to the USA. Neither Ventura nor Eugene
Roberts declared in their letters that Ventura had used the P250,000.00 which
respondent gave to her.
Petitioner in her letter to respondent did not admit, either expressly or impliedly,
having received P211,000.00 from Ventura. Moreover, in her letter to petitioner, only a
week earlier, or on July 18, 1986, Ventura admitted having spent the P39,000.00 and
pleaded that she be allowed to refund the amount within one (1) year, including
interests.
Naririto ang total ng pera mo sa bankbook mo, P55,000.00 pati na yong deposit na
sarili mo at bale ang nagalaw ko diyan ay P39,000.00. Huwag kang mag-alala
ibabalik ko rin sa iyo sa loob ng isang taon pati interest.
Ate Per81 1awphi1.net
It is incredible that Ventura was able to remit to petitioner P211,000.00 before July 25,
1986 when only a week earlier, she was pleading to petitioner for a period of one year
within which to refund the P39,000.00 to petitioner.
It would have bolstered his cause if respondent had submitted an affidavit of Ventura
stating that she had remittedP211,000.00 out of the P250,000.00 she received from
respondent in July 1985 and June 20, 1986.
Curricular Programs" took effect. The law incorporated and consolidated as one
school system certain vocational schools in the province of Cebu, including the
SAHS, and which became an extension of the Cebu State College of Science and
Technology (CSCST).
In the meantime, the province of Cebu decided to recover the 41 lots it had earlier
donated to SAHS on the ground that the said deed was void. The province of Cebu
opined that based on the initial report of its provincial attorney, the SAHS had no
personality to accept the donation.
In the meantime, Asuncion died intestate. When her heirs learned that the province of
Cebu was trying to recover the property it had earlier donated to SAHS, they went to
the province of Cebu on August 19, 1998, informing it of their intention to exercise
their right to repurchase the property as stipulated in the aforecited deed of sale
executed by their predecessor-in-interest.
On February 1, 1989, the province of Cebu (represented by then Governor Emilio M.
R. Osmea), and the CSCST (represented by then DECS Secretary Lourdes R.
Quisumbing), entered into a Memorandum of Agreement over the 40 parcels of land,
allocating 53 hectares to the province of Cebu, and 51 hectares for the SAHS. The
agreement was ratified by the Sangguniang Panlalawigan and the SAHS Board of
Trustees.
In a Letter5 dated March 13, 1990, the heirs of the late Asuncion Sadaya-Misterio,
through their counsel, Atty. Ricardo G. Padilla, informed CSCST of the heirs intention
to exercise the option to repurchase Lot No. 1064 granted to them under the deed of
sale, as the SAHS had ceased to exist.
In response thereto, Jesus T. Bonilla, as Vocational School Superintendent II of
CSCST, wrote Atty. Padilla on March 29, 1990, informing the latter that the SAHS still
existed and "[i]n fact, from a purely secondary school it is now offering collegiate
courses." He explained that "what has been changed is only the name of the school
[to CSCST] which does not imply the loss of its existence."6
On December 23, 1993, Luis, Gabriel, Francis, Thelma, all surnamed Misterio, and
Estella S. Misterio-Tagimacruz, the legitimate heirs of the late Asuncion SadayaMisterio and herein petitioners, filed a Complaint7before the RTC of Cebu City, Branch
18, for "Nullity of Sale and/or Redemption." Named party-defendants were the
CSCST, Armand Fabella as CSCST Chairman, and Dr. Mussolini C. Barillo as CSCST
President, herein respondents. Docketed as Civil Case No. 66-15267, the complaint
alleged in part as follows:
1. Declare the Contract of Sale between the late Asuncion Sadaya and
Sudlon Agricultural High School as null and void for the latter has no legal
personality and cannot own a real property.
As a consequence, to order the actual possessor of the land CSCST to
deliver and reconvey the land to plaintiffs and the latter is willing to return the
money received.
2. In the alternative, declare that Sudlon Agricultural High School has ceased
to exist and allow the plaintiffs to redeem Lot 1064 in the amount stipulated
in the contract.
II
THE TRIAL COURT ERRED IN NOT HOLDING THAT APPELLEES ARE ESTOPPED
FROM QUESTIONING THE PERSONALITY OF THE SUDLON AGRICULTURAL
HIGH SCHOOL.
III
On November 29, 1995, the RTC rendered judgment, the dispositive portion of which
reads:
WHEREFORE, in view of all the foregoing considerations, JUDGMENT is hereby
rendered in favor of the plaintiffs and against the defendants declaring the Deed of
Sale entered into by and between Asuncion Sadaya and Sudlon Agricultural High
School as null and void for the latters lack of juridical personality to acquire real
property or to enter into such transaction or having ceased to exist and ordering the
Cebu State College of Science and Technology being the actual possessor of the
land, Lot 1064, to deliver and reconvey the same to plaintiffs upon payment of the
aforementioned purchased price.
No pronouncement as to costs.
SO ORDERED.12
The RTC ruled that the donation was void ab initio as the SAHS, in the first place, did
not have the personality to be a donee of real property. Moreover, with the enactment
of B.P. Blg. 412, the SAHS ceased to exist and to operate as such. The RTC declared
that, under the Corporation Code, the constituent corporations (SAHS and CSCST)
became one through the merger or consolidation, with CSCST as the surviving entity.
Whether Lot No. 1064 was still being used for school purposes was of no moment,
and to "say that [SAHS] still exists but is now forming part of CSCST is stretching the
interpretation of the contract too far." It concluded that no prescription lay as against
an inexistent contract.
The CSCST, through the Office of Solicitor General (OSG), appealed the decision to
the CA, and outlined the following assignment of errors:
I
THE TRIAL COURT ERRED IN NOT STICKING TO THE ISSUES DEFINED BY THE
PARTIES DURING PRE-TRIAL.
THE TRIAL COURT ERRED IN GIVING WEIGHT TO INADMISSIBLE AND SELFSERVING EVIDENCE.
IV
THE TRIAL COURT ERRED IN NOT HOLDING THAT APPELLEES ACTION IS
BARRED BY PRESCRIPTION.
V
THE TRIAL COURT ERRED IN NOT HOLDING THAT THE DEED OF SALE IS A
CONSENSUAL CONTRACT FREELY ENTERED INTO BY THE PARTIES AND NOT
A CONTRACT OF ADHESION.
VI
THE TRIAL COURT ERRED IN NOT HOLDING THAT THE DEED OF SALE IS NOT
AMBIGUOUS.
VII
THE TRIAL COURT ERRED IN NOT HOLDING THAT THE LOT SUBJECT OF THE
SALE IS STILL BEING USED FOR SCHOOL PURPOSES AS ORIGINALLY
INTENDED BY THE PARTIES.
VIII
THE TRIAL COURT ERRED IN NOT HOLDING THAT B.P. [BLG.] 412 DID NOT
DISSOLVE OR EXTINGUISH SUDLON AGRICULTURAL HIGH SCHOOL BUT
MERELY SUBJECTED THE SAME TO THE SUPERVISION AND ADMINISTRATION
OF CSCST.
The petitioners fault the CA for holding that their right to repurchase Lot No. 1064 had
long since prescribed. Citing Article 1606(3) of the New Civil Code, they argue that
"[p]rescription should start to run from the time it is legally feasible for the party to
redeem the land, which is the time when the action to redeem has accrued." The
petitioners argue that this is so since the issue of whether the SAHS had ceased to
exist had still yet to be resolved. The petitioners posit that unless and until judgment
would be rendered stating that the SAHS has ceased to exist, the period to
repurchase the property would not start to run. It is only from the finality of the said
judgment that the right to repurchase the property may be exercised; hence, they still
had thirty (30) days from the date of the promulgation of the CA decision within which
to repurchase the property. The petitioners further aver that since the lien, their right
to repurchase the property, was annotated on the title of the land, the right to exercise
the same is imprescriptible. They argue that they had been vigilant of their right to
repurchase the property, as far back as 1973. In fact, they made tender of payment in
March 1990, well within the ten-year prescriptive period. They point out that the
CSCST had abandoned its defense of prescription by contending that the condition
for repurchase had not yet become operational.
On October 3, 1997, the CSCST and the province of Cebu executed a Deed for
Reversion, in which the CSCST deeded to the province of Cebu the property covered
by TCT No. 15959. Based on the said deed, TCT No. 146351 was issued by the
Register of Deeds on November 12, 1997 in the name of the province of
Cebu.13Annotated at the dorsal portion thereof was the notice of the pending cases
before the RTC and the CA.
On July 31, 2000, the CA rendered its decision reversing the RTCs decision.
The fallo of the decision reads:
WHEREFORE, the appealed decision is REVERSED and SET ASIDE, and a new
one issued, DISMISSING the instant complaint for lack of merit.
SO ORDERED.14
The appellate court held that the lower court should have confined itself to the issues
defined by the parties during pre-trial, namely, (1) whether Sudlon Agricultural School
still retained its personality as such school or was still in existence; and (2) whether
the petitioners had the right to exercise the right to repurchase the property. The CA
declared that the trial of the case should have been limited to these two issues.
While it affirmed the RTC ruling that the SAHS had ceased to exist when B.P. Blg.
412 took effect, the appellate court ruled that the period for the petitioners to
repurchase the property expired on June 1987, four years after the enactment of B.P.
Blg. 412. It held that the period within which the property was to be repurchased must
be restrictively applied in order to settle ownership and title at the soonest possible
time, and not to leave such title to the subject property uncertain.
The petitioners filed a motion for the reconsideration of the decision, which the CA
denied in a Resolution dated January 25, 2002.
The petitioners filed the present petition for review on certiorari, contending that the
CA erred in (a) resolving the appeal of the respondents based on prescription,
although the issue was never raised during the trial; and (b) resolving that their action
had already prescribed.
The OSG, for its part, contends that the petitioners reliance on Article 1606(3) of the
New Civil Code is misplaced, because the law applies only to sales where the right to
repurchase is not expressly agreed upon by the parties. Here, the right to repurchase
is unquestionable. The OSG, likewise, argues that the annotation of the right of
redemption has no bearing on the issue of prescription. It posits that the "Torrens
System has absolutely nothing to do with the period of prescription of ones right to
repurchase, as in the instant case." The OSG concludes that whatever right the
petitioners had on the property had already prescribed by the mere lapse of time, by
reason of negligence.1avvphi1.net
Central to the issue is the following provision in the deed of sale executed by
Asuncion Sadaya-Misterio in favor of the SAHS:
That the Vendee herein, the SUDLON AGRICULTURAL HIGH SCHOOL, hereby
obligates itself to use the aforementioned Lot No. 1064 for school purposes only, and
it is a condition attached to this contract that the aforementioned vendee obligates
itself to give the Vendor herein, the right to repurchase the said lot by paying to the
Vendee herein the aforementioned consideration of P9,130.00 only, after the
aforementioned SUDLON AGRICULTURAL HIGH SCHOOL shall ceased (sic) to exist
or shall have transferred its school site elsewhere.15
It is true that respondent CSCST, through counsel, was of the view that despite the
effectivity of B.P. Blg. 412, the structure and facilities of the SAHS remained in the
property and, as such, it cannot be said that the said school had ceased to exist. It
argued that the phrase "SAHS ceased to exist" in the deed meant that the structure
and facilities of the school would be destroyed or dismantled, and had no relation
whatsoever to the abolition of the school and its integration into the Cebu State
College for Science and Technology. However, the CA rejected the position of the
respondent CSCST, as well as that of the OSG, and affirmed that of the petitioners.
The four-year period for the petitioners to repurchase the property was not suspended
merely and solely because there was a divergence of opinion between the petitioners,
on the one hand, and the respondent, on the other, as to the precise meaning of the
phrase "after the SAHS shall cease to exist" in the deed of sale. The existence of the
petitioners right to repurchase the property was not dependent upon the prior final
interpretation by the court of the said phrase. Indeed, the petitioners specifically
alleged in the complaint that:
FIRST CAUSE OF ACTION
12. Sudlon Agricultural High School at the time of the execution of the
contract of sale with the late Asuncion Sadaya sometime on December 31,
1956 had no juridical personality of its own. Hence, it cannot acquire and
possess any property, including the parcel of land subject of this action.
13. The Contract of Sale executed was therefore null and void and therefore
non-existent. Thus, the land subject of sale should be reconveyed to the
legitimate heirs of Asuncion Sadaya.
SECOND CAUSE OF ACTION
14. On June 10, 1983, Batas Pambansa Blg. 412 was enacted abolishing
the then Sudlon Agricultural College and converting it to become part of the
Cebu State College for Science and Technology (CSCST).
15. The said law also transferred all the personnel, properties, including
buildings, sites, and improvements, records, obligations, monies and
appropriations of Sudlon to the CSCST.
16. The abolition of Sudlon and its merger or consolidation as part of CSCST
had rendered operative the condition in the Deed of Sale granting the vendor
and her heirs, Asuncion Sadaya, the right to redeem Lot No. 1064.
PANGANIBAN, J.:
Is the failure to annotate the vendor a retro's right of repurchase in the certificates of
title of the real estate properties subject of dacion en pago conclusive evidence of the
vendee a retro's malice and bad faith, entitling the former to damages? In a sale
with pacto de retro, is the repurchase price limited by Article 1616 of the Civil Code?
These are the basic questions raised in this petition for review on certiorari under
Rule 45 of the Rules of Court assailing the Court of Appeals 1 Decision 2 promulgated
on April 25, 1994 and Resolution 3 of September 26, 1994 in CA-G.R. CV No. 39154,
affirming the decision 4 of the Regional Trial Court of Pasig, Branch 157 in Civil Case
No. 51214. The said RTC decision sustained the validity of the subject dacion en
pago agreement and declared the same as "a true sale with right of repurchase."
The Facts
The facts of the case as narrated by the trial court and reproduced in the assailed
Decision of the Court of Appeals are undisputed by the parties. These are the
relevant portions:
It appears that on June 4, 1979, Solid Homes executed in favor of
State Financing (Center, Inc.) a Real Estate Mortgage (Exhibit "3")
on its properties embraced in Transfer Certificate of Title No. 9633
(Exhibit "9") and Transfer Certificate of Title No. (492194) 11938
(Exhibit "8") of the Registry of Deeds in Pasig, Metro Manila, in
order to secure the payment of a loan of P10,000,000.00 which the
former obtained from the latter. A year after, Solid Homes applied
for and was granted an additional loan of P1,511,270.03 by State
Financing, and to secure its payment, Solid Homes executed the
Amendment to Real Estate Mortgage dated June 4, 1980 (Exhibit
"4") whereby the credits secured by the first mortgage on the
abovementioned properties were increased from P10,000,000.00 to
P11,511,270.03. Sometime thereafter, Solid Homes obtained
additional credits and financing facilities from State Financing in the
sum of P1,499,811,97, and to secure its payment, Solid Homes
executed in favor of State Financing the Amendment to Real Estate
Mortgage dated March 5, 1982 (Exhibit "5") whereby the mortgage
executed on its properties on June 4, 1979 was again amended so
that the loans or credits secured thereby were further increased
from P11,511,270.03 to P13,011,082.00.
said letter, State Financing sent a letter dated May 17, 1984
(Exhibit "18") advising Solid Homes that State Financing's
management was not amenable to its proposal, and that by way of
granting it some concessions, said management made a counterproposal requiring Solid Homes to make an initial payment of P10
million until 22 May 1984 and the balance payable within the
remaining period to repurchase the properties as provided for under
the (Memorandum) . . . . Thereafter, a number of conferences were
held among the corporate officers of both companies wherein they
discussed the payment arrangement of Solid Home's outstanding
obligation, . . . . In a letter dated June 7, 1984 (Exhibit "19"), State
Financing reiterated the counter-proposal in its previous letter dated
May 17, 1984 to Solid Homes as a way of making good its account,
and at the same time reminded Solid Homes that it has until 27
June 1984 to exercise its right to repurchase the properties
pursuant to the terms and conditions of the (Memorandum),
otherwise, it will have to vacate and turn over the possession of
said properties to State Financing. In return, Solid Homes sent to
State Financing a letter dated June 18, 1984 (Exhibits "N" and "22")
containing a copy of the written offer made by C.L. Alma Jose &
Sons, Inc. (Exhibits "M" and "22-A") to avail of Solid Homes' right to
repurchase the V.V. Soliven Towers II pursuant to the terms of the
Dacion En Pago. The letter also contained a request that the
repurchase period under said Dacion En Pago which will expire on
June 27, 1984 be extended by sixty (60) days to enable Solid
Homes to comply with the conditions in the offer of Alma Jose &
Sons, Inc. referred to, and thereafter, to avail of the one year period
to pay the balance based on the verbal commitment of State
Financing's President . . . .
However, on June 26, 1984, a day before the expiry date of its right
to repurchase the properties involved in the (Memorandum) on
June 27, 1984, Solid Homes filed the present action against
defendants State Financing and the Register of Deeds for Metro
Manila District II (Pasig), seeking the annulment of said
(Memorandum) and the consequent reinstatement of the
mortgages over the same properties; . . . 5
As earlier stated, the trial court held that the Memorandum of Agreement/Dacion En
Pago executed by the parties was valid and binding, and that the registration of said
instrument in the Register of Deeds was in accordance with law and the agreement of
the parties. It disposed of the case thus:
return the said reinstated former titles (owner's copies) in the name
of Solid Homes to State Financing;
6. Ordering the defendant State Financing to release to plaintiff
Solid Homes all the certificates of title over the fully paid
condominium units in the name of Solid Homes, free from all liens
and encumbrances by releasing the mortgage thereon;
7. Granting the plaintiff Solid Homes the opportunity to exercise its
right to repurchase the properties subject of the Memorandum of
Agreement/Dacion En Pago within thirty (30) days from the finality
of this Decision, by paying to defendant State Financing the agreed
price of P14,225,178.40 plus all cost of money equivalent to 30%
(interest of 14% and penalty of 16% from March 1, 1983) per
annum, registration fees, real estate and documentary stamp taxes
and other incidental expenses incurred by State Financing in the
transfer and registration of its ownership via the Dacion En Pago,
as provided in the said document and in pursuance of Articles 1606
and 1616 of the Civil Code; and
8. Ordering the defendant Register of Deeds in Pasig, Metro Manila
should plaintiff Solid Homes fail to exercise the abovementioned
right to repurchase within 30 days from the finality of this judgment
to record the consolidation of ownership in State Financing over
the properties subject of the Memorandum of Agreement/Dacion En
Pago in the Registry of Property, in pursuance of this Order, but
excluding therefrom the fully paid condominium units and their
corresponding titles to be released by State Financing.
For lack of merit, the respective claims of both parties for damages,
attorney's fees, expenses of litigation and costs of suit are hereby
denied. 6
Both parties appealed from the trial court's decision. Solid Homes raised a lone
question contesting the denial of its claim for damages. Such damages allegedly
resulted from the bad faith and malice of State Financing in deliberately failing to
annotate Solid Homes' right to repurchase the subject properties in the former's
consolidated titles thereto. As a result of the non-annotation, Solid Homes claimed to
have been prevented from generating funds from prospective buyers to enable it to
comply with the Agreement and to redeem the subject properties.
moorings. Furthermore, such transgression was addressed by the lower courts when
they nullified the consolidated of ownership over the subject properties in the name of
respondent corporation, because it had been effected in contravention of the
provisions of Article 1607 20 of the Civil Code. Such rulings are consistent with law
and jurisprudence.
Neither can moral damages be awarded to petitioner. Time and again, we have held
that a corporation being an artificial person which has no feelings, emotions or
senses, and which cannot experience physical suffering or mental anguish is not
entitled to moral damages. 21
While the amount of exemplary damages need not be proved, petitioner must show
that he is entitled to moral or actual damages; 22 but the converse obtains in the
instant case. Award of attorney's fees is likewise not warranted when moral and
exemplary damages are eliminated and entitlement thereto is not demonstrated by
the claimant. 23
Lastly, "(n)ominal damages are adjudicated in order that a right of the plaintiff, which
has been violated or invaded by the defendant, may be vindicated or recognized, and
not for the purpose of indemnifying the plaintiff for any loss suffered by him." 24 As
elaborated above and in the decisions of the two lower courts, no right of petitioner
was violated or invaded by respondent corporation.
Second Issue: Redemption Price
Another fundamental principle of procedural law precludes higher courts from
entertaining matters neither alleged in the pleadings nor raised during the
proceedings below, but ventilated for the first time only in a motion for reconsideration
or on appeal. 25 On appeal, only errors specifically assigned and properly argued in
the brief will be considered, with the exception of those affecting jurisdiction over the
subject
matter
as
well
as
plain
and
clerical
errors. 26
As stated earlier, the single issue raised by petitioner in its appeal of the RTC
decision to the Court of Appeals concerned only the denial of its claim for damages.
Petitioner succinctly stated such issue in its brief as follows:
I. LONE ASSIGNMENT OF ERROR
The trial court erred in that after having found that the registration of
the Memorandum of Agreement/Dacion en Pago on September 15,
It is clear, therefore, that the provisions of Art. 1601 require petitioner to "comply with .
. . the other stipulations" of the Memorandum of Agreement/Dacion en Pago it freely
entered into with private respondent. The said Memorandum's provision on
redemption states:
6. The FIRST PARTY (State Financing) hereby grants the SECOND
PARTY (Solid Homes) the right to repurchase the aforesaid real
properties, including the condominium units and other
improvements thereon, within ten (10) months counted from and
after the one hundred eighty (180) days from date of signing
hereof at an agreed price of P14,225,178.40, or as reduced
pursuant to par. 5 (d), plus all cost of money equivalent to 30% per
annum, registration fees, real estate and documentary stamp taxes
and the other incidental expenses incurred by the FIRST PARTY
(State Financing) in the transfer and registration of its ownership via
dacion en pago . . . 29 (emphasis supplied)
Contracts have the force of law between the contracting parties who may establish
such stipulations, clauses, terms and conditions as they may want subject only to the
limitation that their agreements are not contrary to law, morals, customs, public policy
or public order 30 and the above-quoted provision of the Memorandum does not
appear to be so.
Petitioner, however, is right in its observation that the Court of Appeal's inclusion of
"registration fees, real estate and documentary stamp taxes and other incidental
expenses incurred by State Financing in the transfer and registration of its ownership
(of the subject properties) via dacion en pago" was vague, if not erroneous,
considering that such transfer and issuance of the new titles were null and void. Thus,
the redemption price shall include only those expenses relating to the registration of
the dacion en pago, but not the registration and other expenses incurred in the
issuance of new certificates of title in the name of State Financing.
Possession
of
During the Redemption Period
the
Subject
Properties
The Court of Appeals Decision modified that of the trial court only insofar as it ordered
petitioner to deliver possession of the subject properties to State Financing, the
vendee a retro. We find no legal error in this holding. In a contract of sale with pacto
de retro, the vendee has a right to the immediate possession of the property sold,
unless otherwise agreed upon. It is basic that in a pacto de retro sale, the title and
ownership of the property sold are immediately vested in the vendee a retro, subject
RONALDO
P.
ABILLA
and
GERALDA
A.
DIZON, petitioners,
vs.
CARLOS ANG GOBONSENG, JR. and THERESITA MIMIE ONG, respondents.
YNARES-SANTIAGO, J.:
May the vendors in a sale judicially declared as a pacto de retro exercise the right of
repurchase under Article 1606, third paragraph, of the Civil Code, after they have
taken the position that the same was an equitable mortgage?
This is the legal question raised in this petition for review assailing the January 14,
2001 Order1 of the Regional Trial Court of Dumaguete City, Branch 41, in Civil Case
No. 8148, which granted herein respondent spouses the right to repurchase the
seventeen lots2 subject of the pacto de retro sale within thirty (30) days from the
finality of the order.
The undisputed facts are as follows:
Petitioner spouses instituted against respondents an action for specific performance,
recovery of sum of money and damages, docketed as Civil Case No. 8148 of the
Regional Trial Court of Dumaguete City, Branch XLII, seeking the reimbursement of
the expenses they incurred in connection with the preparation and registration of two
public instruments, namely a "Deed of Sale" 3 and an "Option to Buy." 4 In their answer,
respondents raised the defense that the transaction covered by the "Deed of Sale"
and "Option to Buy," which appears to be a Deed of Sale with Right of Repurchase,
was in truth, in fact, in law, and in legal construction, a mortgage.5
On October 29, 1990, the trial court ruled in favor of petitioners and declared that the
transaction between the parties was not an equitable mortgage. Citing Villarica v.
Court of Appeals,6 it ratiocinated that neither was the said transaction embodied in the
"Deed of Sale" and "Option to Buy" a pacto de retro sale, but a sale giving
respondents until August 31, 1983 within which to buy back the seventeen lots
subject of the controversy. The dispositive portion thereof reads:
IN THE LIGHT OF THE FOREGOING, it is the considered opinion of this
Court that plaintiffs have proven by preponderance of evidence their case
and judgment is therefore rendered in their favor as follows:
1. Ordering defendants to pay plaintiffs the sum of P171,483.40
representing the total expenses incurred by plaintiffs in the
preparation and registration of the Deed of Sale, amount paid to the
Bank of Asia and America (IBAA) and capital gains tax with legal
rate of interest from the time the same was incurred by plaintiffs up
to the time payment is made by defendants; P10,000.00 as
attorneys fees; P15,000.00 moral damages; P10,000.00 expenses
of litigation and to pay cost.
2. The Philippine National Bank, Dumaguete City Branch is directed
to release in favor of plaintiffs, the spouses Ronaldo P. Abilla and
Gerald A. Dizon all the money deposited with the said bank,
representing the rentals of a residential house erected inside in one
of the lots in question;
3. For insufficiency of evidence, defendants counterclaim is
ordered dismissed.
SO ORDERED.7
On appeal by respondents, the Court of Appeals ruled that the transaction between
the parties was a pacto de retro sale, and not an equitable mortgage. 8 The decretal
portion thereof states:
WHEREFORE, the decision appealed from is MODIFIED by deleting the
award of attorneys fees. In other respects the decision of the lower court is
AFFIRMED. Costs against defendant-appellants.
SO ORDERED.9
The question now is, can respondents avail of the aforecited provision? Following the
theory of the respondents which was sustained by the trial court, the scenario would
be that although respondents failed in their effort to prove that the contract was an
equitable mortgage, they could nonetheless still repurchase the property within 30
days from the finality of the judgment declaring the contract to be truly a pacto de
retro sale. However, under the undisputed facts of the case at bar, this cannot be
allowed.
In the parallel case of Vda. de Macoy v. Court of Appeals,15 the petitioners therein
raised the defense that the contract was not a sale with right to repurchase but an
equitable mortgage. They further argued as an alternative defense that even
assuming the transaction to be a pacto de retro sale, they can nevertheless
repurchase the property by virtue of Article 1606, third paragraph of the Civil Code. It
was held that the said provision was inapplicable, thus:
The application of the third paragraph of Article 1606 is predicated upon
the bona fides of the vendor a retro. It must appear that there was a belief on
his part, founded on facts attendant upon the execution of the sale
with pacto de retro, honestly and sincerely entertained, that the agreement
was in reality a mortgage, one not intended to affect the title to the property
ostensibly sold, but merely to give it as security for a loan or other obligation.
In that event, if the matter of the real nature of the contract is submitted for
judicial resolution, the application of the rule is meet and proper; that the
vendor a retro be allowed to repurchase the property sold within 30 days
from rendition of final judgment declaring the contract to be a true sale with
right to repurchase. Conversely, if it should appear that the parties
agreement was really one of sale transferring ownership to the vendee,
but accompanied by a reservation to the vendor of the right to repurchase
the property and there are no circumstances that may reasonably be
accepted as generating some honest doubt as to the parties' intention,
the proviso is inapplicable. The reason is quite obvious. If the rule were
otherwise, it would be within the power of every vendor a retro to set at
naught apacto de retro, or resurrect an expired right of repurchase, by
simply instituting an action to reform the contract known to him to be in
truth a sale with pacto de retro into an equitable mortgage. As postulated
by the petitioner, "to allow herein private respondents to repurchase the
property by applying said paragraph x x x to the case at bar despite the fact
that the stipulated redemption period had already long expired when they
instituted the present action, would in effect alter or modify the stipulation in
the contract as to the definite and specific limitation of the period for
repurchase (2 years from date of sale or only until June 25, 1958) thereby
not simply increasing but in reality resuscitating the expired right to
repurchase x x x and likewise the already terminated and extinguished
MENDOZA, J.:
FRANCISCO, petitioner,
This is a petition for review of the decision of the Court of Appeals in CA-G.R. CV No.
55518 which affirmed in totothe decision of the Regional Trial Court, Branch 122,
Caloocan City, dismissing petitioner's complaint for redemption of property against
respondent.
The facts are as follows:
Petitioner Adalia B. Francisco and three of her sisters, Ester, Elizabeth and Adeluisa,
were co-owners of four parcels of registered lands 1 on which stands the Ten
Commandments Building at 689 Rizal Avenue Extension, Caloocan City. On August
6, 1979, they sold 1/5 of their undivided share in the subject parcels of land to their
mother, Adela Blas, for P10,000.00, thus making the latter a co-owner of said real
property to the extent of the share sold.
On August 8, 1986, without the knowledge of the other co-owners, Adela Blas sold
her 1/5 share for P10,000.00 to respondent Zenaida Boiser who is another sister of
petitioner.
On August 5, 1992, petitioner received summons, with a copy of the complaint in Civil
Case No. 15510, filed by respondent demanding her share in the rentals being
collected by petitioner from the tenants of the building. Petitioner then informed
respondent that she was exercising her right of redemption as a co-owner of the
subject property. On August 12, 1992, she deposited the amount of P10,000.00 as
redemption price with the Clerk of Court. This move to redeem the property was
interposed as a permissive counterclaim in Civil Case No. 15510. However, said case
was dismissed after respondent was declared non-suited with the result that
petitioner's counterclaim was likewise dismissed.
On September 14, 1995, petitioner instituted Civil Case No. C-17055 before the
Regional Trial Court in Caloocan City. She alleged that the 30-day period for
redemption under Art. 1623 of the Civil Code had not begun to run against her since
the vendor, Adela Blas, never informed her and the other owners about the sale to
respondent. She learned about the sale only on August 5, 1992, after she received
the summons in Civil Case No. 15510, together with the complaint.
Respondent, on the other hand, contended that petitioner knew about the sale as
early as May 30, 1992, because, on that date, she wrote petitioner a letter 2 informing
the latter about the sale, with a demand that the rentals corresponding to her 1/5
share of the subject property be remitted to her. Said letter was sent with a copy of
the Deed of Sale 3 between respondent and Adela Blas. On the same date,
letters4 were likewise sent by respondent to the tenants of the building, namely, Seiko
Service Center and Glitters Corporation, informing them of the sale and requesting
notice by the seller removes all doubts as to fact of the sale, its
perfection, and its validity, the notice being a reaffirmation thereof;
so that that party notified need not entertain doubt that the seller
may still contest the alienation. This assurance would not exist if
the notice should be given by the buyer.
In the case at bar, the plaintiffs have not been furnished any written
notice of sale or a copy thereof by Eufemia Omole, the vendor. Said
plaintiffs' right to exercise the legal right of preemption or
redemption, given to a co-owner when any one of the other coowners sells his share in the thing owned in common to a third
person, as provided for in Article 1623 of the Civil Code, has not yet
accrued.
There was thus a return to the doctrine laid down in Butte. That ruling is sound. In the
first place, reversion to the ruling in Butte is proper. Art. 1623 of the Civil Code is clear
in requiring that the written notification should come from the vendor or prospective
vendor, not from any other person. There is, therefore, no room for construction.
Indeed, the principal difference between Art. 1524 of the former Civil Code and Art.
1623 of the present one is that the former did not specify who must give the notice,
whereas the present one expressly says the notice must be given by the vendor.
Effect must be given to this change in statutory language.
In the second place, it makes sense to require that the notice required in Art. 1623 be
given by the vendor and by nobody else. As explained by this Court through Justice
J.B.L. Reyes in Butte, the vendor of an undivided interest is in the best position to
know who are his co-owners who under the law must be notified of the sale. It is
likewise the notification from the seller, not from anyone else, which can remove all
doubts as to the fact of the sale, its perfection, and its validity, for in a contract of sale,
the seller is in the best position to confirm whether consent to the essential obligation
of selling the property and transferring ownership thereof to the vendee has been
given.
Now, it is clear that by not immediately notifying the co-owner, a vendor can delay or
even effectively prevent the meaningful exercise of the right of redemption. In the
present case, for instance, the sale took place in 1986, but it was kept secret until
1992 when vendee (herein respondent) needed to notify petitioner about the sale to
demand 1/5 rentals from the property sold. Compared to serious prejudice to
petitioner's right of legal redemption, the only adverse effect to vendor Adela Blas and
respondent-vendee is that the sale could not be registered. It is non-binding, only
insofar as third persons are concerned. 17 It is, therefore, unjust when the subject sale
has already been established before both lower courts and now, before this Court, to
RUPERTO
SORIANO,
ET
AL., plaintiffs-appellees,
vs.
BASILIO
BAUTISTA,
ET
AL., defendants.
BASILIO BAUTISTA and SOFIA DE ROSAS, defendants-appellants.
---------------------------------
WHEREFORE, in view of the foregoing, the petition is GRANTED and the decision of
the Court of Appeals is REVERSED and the Regional Trial Court, Branch 122,
Caloocan City is ordered to effect petitioner's exercise of her right of legal redemption
in Civil Case No. C-17055.
SO ORDERED.
BASILIO
BAUTISTA,
ET
AL., plaintiffs,
BASILIO
BAUTISTA
and
SOFIA
DE
ROSAS, plaintiffs-appellants,
vs.
RUPERTO SORIANO, ET AL., defendants appellees.
Amado T. Garrovillas, Ananias C. Ona, Norberto A. Ferrera and Pedro N. Belmi for
appellants
Basilio
Bautista
and
Sofia
de
Rosas.
Javier and Javier for appellees Ruperto Soriano, et al.
MAKALINTAL, J.:
The judgment appealed from, rendered on March 10, 1959 by the Court of First
Instance of Rizal, after a joint trial of both cases mentioned in the caption, orders "the
spouses Basilio Bautista and Sofia de Rosas to execute a deed of sale covering the
property in question in favor of Ruperto Soriano and Olimpia de Jesus upon payment
ng
ng
na
na
that of appellees, who are not here enforcing any real right to the disputed land but
are rather seeking to obtain specific performance of a personal obligation, namely, the
execution of a deed of sale for the price agreed upon, the corresponding amount to
cover which was duly deposited in court upon the filing of the complaint.
Reference is made in appellants' brief to the fact that they tendered the sum of
P1,800.00 to redeem mortgage before they filed their complaint in civil case No. 99 in
the Justice of the Peace Court of Morong, Rizal. That tender was ineffective for the
purpose intended. In the first place it must have been made after the option to
purchase had been exercised by appellees (Civil Case No. 99 was filed on June 9,
1958, only to be dismissed for lack of jurisdiction); and secondly, appellants' to
redeem could be defeated by appellees' preemptive right to purchase within the
period of two years from May 30, 1956. As already noted, such right was availed of
appellants were accordingly notified by letter dated May 13, 1958, which was
received by them on the following May 22. Offer and acceptance converged and gave
to a perfected and binding contract of purchase and sale.
The judgment appealed from is affirmed, with costs.
Appellants contend that, being mortgagors, they can not be deprived of the right to
redeem the mortgaged property, because such right is inherent in and inseparable
from this kind of contract. The premise of the contention is not entirely accurate.
While the transaction is undoubtedly a mortgage and contains the customary
stipulation concerning redemption, it carries the added special provision aforequoted,
which renders the mortgagors' right to redeem defeasible at the election of the
mortgagees. There is nothing illegal or immoral in this. It is simply an option to buy,
sanctioned by Article 1479 of the Civil Code, which states: "A promise to buy and sell
a determinate thing for a price certain is reciprocally demandable. An accepted
unilateral promise to buy or to sell a determinate thing for a price certain is binding
upon the promissor if the promise is supported by a consideration distinct from the
price."
In this case the mortgagor's promise to sell is supported by the same consideration
as that of the mortgage itself, which is distinct from that which would support the sale,
an additional amount having been agreed upon to make up the entire price of
P3,900.00, should the option be exercised. The mortgagors' promise was in the
nature of a continuing offer, non-withdrawable during a period of two years, which
upon acceptance by the mortgagees gave rise to a perfected contract of purchase
and sale. Appellants cite the case of Iigo vs. Court of Appeals, L-5572, O.G. No. 11,
5281, where we held that a stipulation in a contract of mortgage to sell the property to
the mortgagee does not bind the same but creates only a personal obligation on the
part of the mortgagor. The citation instead of sustaining appellant's position, confirms
PARAS, J.:p
In this petition for review on certiorari, petitioner challenges the April 22, 1985
decision * and the July 16, 1985 resolution *of the then Intermediate Appellate Court
in AC-G.R. CV No. 02553 entitled "BA Finance Corporation v. Nyco Sales
Corporation, et al." which affirmed with modification the July 20, 1983 decision ** of
the Regional Trial Court, National Capital Region, Manila, Branch II in the same case
docketed as Civil Case No. 125909 ordering petitioner to pay respondent the amount
of P60,000.00 as principal obligation plus corresponding interest, the sum of
P10,000.00 as and for, attomey's fees and 1/3 of the costs of suit.
It appears on record that petitioner Nyco Sales Corporation (hereinafter referred to as
Nyco) whose president and general manager is Rufino Yao, is engaged in the
business of selling construction materials with principal office in Davao City.
Sometime in 1978, the brothers Santiago and Renato Fernandez (hereinafter referred
to as the Fernandezes), both acting in behalf of Sanshell Corporation, approached
Rufino Yao for credit accommodation. They requested Nyco, thru Yao, to grant
Sanshell discounting privileges which Nyco had with BA Finance Corporation
(hereinafter referred to as BA Finance). Yao apparently acquiesced, hence on or
about November 15, 1978, the Fernandezes went to Yao for the purpose of
discounting Sanshell's post-dated check which was a BPI-Davao Branch Check No.
499648 dated February 17, 1979 for the amount of P60,000.00. The said check was
payable to Nyco. Following the discounting process agreed upon, Nyco, thru Yao,
endorsed the check in favor of BA Finance. Thereafter, BA Finance issued a check
payable to Nyco which endorsed it in favor of Sanshell. Sanshell then made use of
and/or negotiated the check. Accompanying the exchange of checks was a Deed of
Assignment executed by Nyco in favor of BA Finance with the conformity of Sanshell.
Nyco was represented by Rufino Yao, while Sanshell was represented by the
Fernandez brothers. Under the said Deed, the subject of the discounting was the
aforecited check (Rollo, pp- 26-28). At the back thereof and of every deed of
assignment was the Continuing Suretyship Agreement whereby the Fernandezes
unconditionally guaranteed to BA Finance the full, faithful and prompt payment and
discharge of any and all indebtedness of Nyco (Ibid., pp. 36, 46). The BPI check,
however, was dishonored by the drawee bank upon presentment for payment. BA
Finance immediately reported the matter to the Fernandezes who thereupon issued a
substitute check dated February 19,1979 for the same amount in favor of BA Finance.
It was a Security Bank and Trust Company check bearing the number 183157, which
was again dishonored when it was presented for payment. Despite repeated
demands, Nyco and the Fernandezes failed to settle the obligation with BA Finance,
thus prompting the latter to institute an action in court (Ibid., p 28). Nyco and the
Fernandezes, despite having been served with summons and copies of the
complaint, failed to file their answer and were consequently declared in default. On
May 16, 1980, the lower court ruled in favor of BA Finance ordering them to pay the
former jointly and severally, the sum of P65,536.67 plus 14% interest per annum from
July 1, 1979 and attorney's fees in the amount of P3, 000. 00 as well as the costs of
suit (Rollo, pp. 51-52). Nyco, however, moved to set aside the order of default, to
have its answer admitted and to be able to implead Sanshell. The prayer was granted
through an order dated June 23, 1980, wherein the decision of the court was set
aside only as regards Nyco. Trial ensued once more until the court reached a second
decision which states:
WHEREFORE, judgment is hereby rendered in favor of the plaintiff
and against the defendant Nyco Sales Corporation by ordering the
latter to pay the former the following:
1) P60,000.00 as principal obligation, plus interest thereon at the
rate of 14% per annum from February 1, 1979 until fully paid;
2) The amount of P100,000.00 as and for attorney's fees; and
3) One-third (1/3) of the costs of this suit.
With respect to defendants Santiago and Renato Fernandez, the
decision of May 16, 1980 stands.
The cross-claim of defendant Nyco Sales Corporation against
codefendants Santiago B. Fernandez and Renato B. Fernandez is
hereby denied, as there is no showing that Nyco's Answer with
cross-claim dated May 29, 1980 was ever received by said
Fernandez brothers, even as it is noted that the latter have not
been declared in default with respect to said cross-claim, nor were
evidence adduced in connection therewith. As to the would-be
litigant Sanshell Construction and Development Corporation,
defendant Nyco Sales Corporation did not properly implead said
corporation which should have been by way of a third-party
complaint instead of a mere cross-claim. The same observations
are noted as regard this cross-claim against Sanshell as those
made with respect to the Fernandez brothers.
Nyco's pretension that it had not been notified of the fact of dishonor is belied not only
by the formal demand letter but also by the findings of the trial court that Rufino Yao
of Nyco and the Fernandez Brothers of Sanshell had frequent contacts before, during
and after the dishonor (Rollo, p. 40). More importantly, it fails to realize that for as
long as the credit remains outstanding, it shall continue to be liable to BA Finance as
its assignor. The dishonor of an assigned check simply stresses its liability and the
failure to give a notice of dishonor will not discharge it from such liability. This is
because the cause of action stems from the breach of the warranties embodied in the
Deed of Assignment, and not from the dishonoring of the check alone (See Art. 1628,
Civil Code).
Novation is the third defense set up by petitioner Nyco. It insists that novation took
place when BA Finance accepted the SBTC check in replacement of the BPI cheek.
Such is manifestly untenable.
There are only two ways which indicate the presence of novation and thereby
produce the effect of extinguishing an obligation by another which substitutes the
same. First, novation must be explicitly stated and declared in unequivocal terms as
novation is never presumed (Mondragon v. Intermediate Appellate Court, G.R. No.
71889, April 17, 1990; Caneda Jr. v. Court of Appeals, G.R. No. 81322, February 5,
1990). Secondly, the old and the new obligations must be incompatible on every
point. The test of incompatibility is whether or not the two obligations can stand
together, each one having its independent existence If they cannot, they are
incompatible and the latter obligation novates the first (Mondragon v. Intermediate
Appellate Court, supra; Caneda Jr. v. Court of Appeals,supra). In the instant case,
there was no express agreement that BA Finance's acceptance of the SBTC check
will discharge Nyco from liability. Neither is there incompatibility because both checks
were given precisely to terminate a single obligation arising from Nyco's sale of credit
to BA Finance. As novation speaks of two distinct obligations, such is inapplicable to
this case.
Finally, Nyco disowns its President's acts claiming that it never authorized Rufino Yao
(Nyco's President) to even apply to BA Finance for credit accommodation. It supports
its argument with the fact that it did not issue a Board resolution giving Yao such
authority. However, the very evidence on record readily belies Nyco's contention. Its
corporate By-Laws clearly provide for the powers of its President, which include, inter
alia, executing contracts and agreements, borrowing money, signing, indorsing and
delivering checks, all in behalf of the corporation. Furthermore, the appellate court
correctly adopted the lower court's observation that there was already a previous
transaction of discounting of checks involving the same personalities wherein any
enabling resolution from Nyco was dispensed with and yet BA Finance was able to
collect from Nyco and Sanshell was able to discharge its own undertakings. Such
retrieving, not only the interest or profits, but even the very investments he
had put in Anglo-Asean.1wphi1.nt
Confronted with the dire prospect of not getting back any of his investments,
Licaros then decide to seek the counsel of Antonio P. Gatmaitan, a reputable
banker and investment manager who had been extending managerial,
financial and investment consultancy services to various firms and
corporations both here and abroad. To Licaros' relief, Gatmaitan was only
too willing enough to help. Gatmaitan voluntarily offered to assume the
payment of Anglo-Asean's indebtedness to Licaros subject to certain terms
and conditions. In order to effectuate and formalize the parties' respective
commitments, the two executed a notarized MEMORANDUM OF
AGREEMENT on July 29, 1988 (Exh. "B"); also Exhibit "1"), the full text of
which reads:
August 9, 2001
ABELARDO
B.
vs.
ANTONIO P. GATMAITAN, respondent.
LICAROS, petitioner,
GONZAGA-REYES, J.:
This is a petition for review on certiorari under Rule 45 of the Rules of Court. The
petition seeks to reverse and set aside the Decision1 dated February 10, 2000 of the
Court of Appeals and its Resolution2 dated April 7, 2000 denying petitioner's Motion
for Reconsideration thereto. The appellate court decision reversed the Decision3dated
November 11, 1997 of the Regional Trial Court of Makati, Branch 145 in Civil Case
No. 96-1211.
The facts of the case, as stated in the Decision of the Court o Appeals dated February
10, 2000, are as follows:
"The Anglo-Asean Bank and Trust Limited (Anglo-Asean, for brevity), is a
private bank registered and organized to do business under the laws of the
Republic of Vanuatu but not in the Philippines. Its business consists primarily
in receiving fund placements by way of deposits from institutions and
individuals investors from different parts of the world and thereafter investing
such deposits in money market placements and potentially profitable capital
ventures in Hongkong, Europe and the United States for the purpose of
maximizing the returns on those investments.
Enticed by the lucrative prospects of doing business with Anglo-Asean,
Abelardo Licaros, a Filipino businessman, decided to make a fund
placement with said bank sometime in the 1980's. As it turned out, the grim
outcome of Licaros' foray in overseas fund investment was not exactly what
he envisioned it to be. More particularly, Licaros, after having invested in
Anglo-Asean, encountered tremendous and unexplained difficulties in
Memorandum of Agreement
KNOW ALL MEN BY THESE PRESENTS:
This MEMORANDUM OF AGREEMENT made and executed this 29th day of July
1988, at Makati by and between:
ABELARDO B. LICAROS, Filipino, of legal age and holding office at Concepcion
Building, Intramuros, Manila hereinafter referred to as THE PARTY OF THE FIRST
PART,
and
ANTONIO P. GATMAITAN, Filipino, of legal age and residing at 7 Mangyan St., La
vista, hereinafter referred to as the PARTY OF THE SECOND PART,
WITNESSETH THAT:
WHEREAS, ANGLO-ASEAN BANK & TRUST, a company incorporated by the
Republic of Vanuatu, hereinafter referred to as the OFFSHORE BANK, is indebted to
the PARTY OF THE FIRST PART in the amount of US dollars; ONE HUNDRED
FIFTY THOUSAND ONLY (US$150,000) which debt is now due and demandable.
WHEREAS, the PARTY OF THE FIRST PART has encountered difficulties in securing
full settlement of the said indebtedness from the OFFSHORE BANK and has sought
a business arrangement with the PARTY OF THE SECOND PART regarding his
claims;
c. Agree and stipulate that the debt assigned herein is justly owing
and due to the PARTY OF THE FIRST PART from the said
OFFSHORE BANK, and that the PARTY OF THE FIRST PART has
not done and will not cause anything to be done to diminish or
discharge said debt, or to delay or prevent the PARTY OF THE
SECOND PART from collecting the same; and;
WHREAS, the parties herein have come to an agreement on the nature, form and
extent of their mutual prestations which they now record herein with the express
conformity of the third parties concerned;
NOW, THEREFORE, for and in consideration of the foregoing and the mutual
covenants stipulated herein, the PARTY OF THE FIRST PART and the PARTY OF
THE SECOND PART have agreed, as they do hereby agree, as follows:
1. The PARTY OF THE SECOND PART hereby undertakes to pay the
PARTY OF THE FIRST PART the amount of US DOLLARS ONE
HOUNDRED FIFTY THOUSAND (US$150,000) payable in Philippine
Currency at the fixed exchange rate of Philippine Pesos 21 to US$1 without
interest on or before July 15, 1993.
Sgd.
For this purpose, the PARTY OF THE SECOND PART shall execute and
deliver a non negotiable promissory note, bearing the aforesaid material
consideration in favor of the PARTY OF THE FIRST PART upon execution of
this MEMORANDUM OF AGREEMENT, which promissory note shall form
part as ANNEX A hereof.
ABELARDO B. LICAROS
Sgd.
ANTONIO P. GATMAITAN
b. Grant the PART OF THE SECOND PART the full power and WITH OUR CONFORME:
authority, for his own use and benefit, but at his own cost and
expense, to demand, collect, receive, compound, compromise and
give acquittance for the same or any part thereof, and in the name
of the PARTY OF THE FIRST PART, to prosecute, and withdraw ANGLO-ASEAN BANK & TRUST
any suit or proceedings therefor;
BY: (Unsigned)
Sgd. (Illegible)
In the event that I decide to sell or transfer my aforesaid shares in either or
both the Prudential Life Plan, Inc. or Prudential Life Realty, Inc. and the
Promissory Note remains unpaid or outstanding, I hereby give Mr. Abelardo
B. Licaros the first option to buy the said shares.
________________________________
________________________________
Manila, Philippines
July ______, 1988
(SGD.)
ANTONIO
7 Mangyan St., La Vista QC
SIGNED
(SGD.)
IN
P.
GATMAITAN
THE
______________________________
_____
Francisco
President, Prudential Life Plan, Inc."
PRESENCE
OF:
_________________________
A.
Alba
debtor. The assignment may be done gratuitously or onerously, in which case, the
assignment has an effect similar to that of a sale.7
On the other hand, subrogation has been defined as the transfer of all the rights of
the creditor to a third person, who substitutes him in all his rights. It may either be
legal or convention. Legal subrogation is that which takes place without agreement
but by operation of law because of certain acts. Conventional subrogation is that
which takes place by agreement of parties.8
The general tenor of the foregoing definitions of the terms "subrogation" and
"assignment of credit" may make it seem that they are one and the same which they
are not. A noted expert in civil law notes their distinctions thus:
"Under our Code, however, conventional subrogation is not identical to
assignment of credit. In the former, the debtor's consent is necessary; in the
latter it is not required. Subrogation extinguishes the obligation and gives
rise to a new one; assignment refers to the same right which passes from
one person to another. The nullity of an old obligation may be cured by
subrogation, such that a new obligation will be perfectly valid; but the nullity
of an obligation is not remedied by the assignment of the creditor's right to
another."9
For our purposes, the crucial distinction deals with the necessity of the consent of the
debtor in the original transaction. In an assignment of credit, the consent of the debtor
is not necessary in order that the assignment may fully produce legal effects. 10 What
the law requires in an assignment of credit is not the consent of the debtor but merely
notice to him as the assignments takes effect only from the time he has knowledge
thereof.11 A creditor may, therefore, validly assign his credit and its accessories
without the debtor's consent.12 On the other hand, conventional subrogation requires
an agreement among the three parties concerned the original creditor, the debtor,
and the new creditor. It is a new contractual relation based on the mutual agreement
among all the necessary parties. Thus, Article 1301 of the Civil Code explicitly states
that "(C)onventional subrogation of a third person requires the consent of the original
parties and of the third person."
The threshold issue for the determination of this Court is whether the Memorandum of
Agreement between petitioner and respondent is one of assignment of credit or one
of conventional subrogation. This matter is determinative of whether or not
respondent became liable to petitioner under the promissory note considering that its
efficacy is dependent on the Memorandum of Agreement, the note being merely an
annex to the said memorandum.6
The trial court, in finding for the petitioner, ruled that the Memorandum of Agreement
was in the nature of an assignment of credit. As such, the court a quo held
respondent liable for the amount stated in the said agreement even if the parties
thereto failed to obtain the consent of Anglo-Asean Bank. On the other hand, the
appellate court held that the agreement was one of conventional subrogation which
necessarily requires the agreement of all the parties concerned. The Court of Appeals
thus ruled that the Memorandum of Agreement never came into effect due to the
failure of the parties to get the consent of Anglo-Asean Bank to the agreement and,
as such, respondent never became liable for the amount stipulated.
An assignment of credit has been defined as the process of transferring the right of
the assignor to the assignee who would then have the right to proceed against the
We agree with the finding of the Court of Appeals that the Memorandum of
Agreement dated July 29, 1988 was in the nature of a conventional subrogation which
Under this notation, the words "ANGLO-ASEAN BANK AND TRUST" were written by
hand.14 To our mind, this provision which contemplates the signed conformity of
Anglo-Asean Bank, taken together with the aforementioned preambulatory clause
leads to the conclusion that both parties intended that Anglo-Asean Bank should
signify its agreement and conformity to the contractual arrangement between
petitioner and respondent. The fact that Anglo-Asean Bank did not give such consent
rendered the agreement inoperative considering that, as previously discussed, the
consent of the debtor is needed in the subrogation of a third person to the rights of a
creditor.
In this petition, petitioner assails the ruling of the Court of Appeals that what was
entered into by the parties was a conventional subrogation of petitioner's rights as
creditor of the Anglo-Asean Bank which necessary requires the consent of the latter.
In support, petitioner alleges that: (1) the Memorandum of Agreement did not create a
new obligation and, as such, the same cannot be a conventional subrogation; (2) the
consent of Anglo-Asean Bank was not necessary for the validity of the Memorandum
of Agreement; (3) assuming that such consent was necessary, respondent failed to
secure the same as was incumbent upon him; and (4) respondent himself admitted
that the transaction was one of assignment of credit.
Petitioner argues that the parties to the Memorandum of Agreement could not have
intended the same to be a conventional subrogation considering that no new
obligation was created. According to petitioner, the obligation of Anglo-Asean Bank to
pay under Contract No. 00193 was not extinguished and in fact, it was the basic
intention of the parties to the Memorandum of Agreement to enforce the same
obligation of Anglo-Asean Bank under its contract with petitioner. Considering that the
old obligation of Anglo-Asean Bank under Contract No. 00193 was never
extinguished under the Memorandum of Agreement, it is contended that the same
could not be considered as a conventional subrogation.
We are not persuaded.
It is true that conventional subrogation has the effect of extinguishing the old
obligation and giving rise to a new one. However, the extinguishment of the old
obligation is the effect of the establishment of a contract for conventional subrogation.
It is not a requisite without which a contract for conventional subrogation may not be
created. As such, it is not determinative of whether or not a contract of conventional
subrogation was constituted.
Moreover, it is of no moment that the subject of the Memorandum of Agreement was
the collection of the obligation of Anglo-Asean Bank to petitioner Licaros under
Contract No. 00193. Precisely, if conventional subrogation had taken place with the
consent of Anglo-Asian Bank to effect a change in the person of its creditor, there is
necessarily created a new obligation whereby Anglo-Asean Bank must now give
payment to its new creditor, herein respondent.
As to this argument regarding the party responsible for securing the conformity of
Anglo-Asean Bank, we fail to see how this question would have any relevance on the
outcome of this case. Having ruled that the consent of Anglo-Asean was necessary
for the validity of the Memorandum of Agreement, the determinative fact is that such
consent was not secured by either petitioner or respondent which consequently
resulted in the invalidity of the said memorandum.
With respect to the argument of petitioner that respondent himself allegedly admitted
in open court that an assignment of credit was intended, it is enough to say that
respondent apparently used the word "assignment" in his testimony in the general
sense. Respondent is not a lawyer and as such, he is no so well versed in law that he
would be able to distinguish between the concepts of conventional subrogation and of
assignment of credit. Moreover, even assuming that there was an admission on his
part, such admission is not conclusive on this court as the nature and interpretation of
the Memorandum of Agreement is a question of law which may not be the subject of
stipulations and admission.18
Considering the foregoing, it cannot then be said that the consent of the debtor AngloAsean Bank is not necessary to the validity of the Memorandum of Agreement. As
above stated, the Memorandum of Agreement embodies a contract for conventional
subrogation and in such a case, the consent of the original parties and the third
person is required.19 The absence of such conformity by Anglo-Asean Bank prevented
the Memorandum of Agreement from becoming valid and effective. Accordingly, the
Court of Appeals did not err when it ruled that the Memorandum of Agreement was
never perfected.
Having arrived at the above conclusion, the Court finds no need to discuss the other
issues raised by petitioner.
WHEREFORE, the instant petition is DENIED and the Decision of the Court of
Appeals dated February 10, 2000 and its Resolution dated April 7, 2000 are hereby
AFFIRMED.1wp