Heirs of Mascunana v CA[G.R. No. 158646. June 23, 2005]HEIRS OF JESUS M.

MASCUANA, represented by JOSE MA. R.MASCUANA, petitioners, vs. COURT

OF APPEALS, AQUILINO BARTE, and SPOUSES RODOLFOand CORAZON LAYUMAS,
respondents.

1. Gertrudis Wuthrich and her six other siblings were the co-owners of a parcel of
land identified as Lot No. 124 of the San Carlos City, Negros Occidental Cadastre.
Over time,Gertrudis and two other co-owners sold each of their one-seventh (1/7)
shares, or a totalarea of 741 square meters, to Jesus Mascuana.
2. Jesus Mascunana sold a portion of his 140-square-meter undivided share of the
property to Diosdado Sumilhig. Mascuana later sold an additional 160-squaremeter portion to Sumilhig. However, the parties agreed to revoke the said deed of
sale and, in lieu thereof, executed a Deed of Absolute Sale. In the said deed,
Mascuana, as vendor,sold an undivided 469-square-meter portion of the property
for P4,690.00, with P3,690.00 as down payment.( balance of ONE THOUSAND PESOS
(P1,000.00) shall be paid by the VENDEE unto the VENDOR as soon as the aboveportions of Lot 124 shall have been surveyed in the name of the VENDEE and all
papers pertinent and necessary to the issuance of a separate Certificate of Title in
the name of the VENDEE shall have been prepared. ) A survey was conducted and
the portion of the property deeded to Sumilhig was identified in the said plan as Lot
No. 124-B.[6]3. Meanwhile, Mascuana died intestate and was survived by his
heirs,Eva M. Ellisin, Renee Hewlett, Carmen Vda. de Opea, Marilou Dy andJose Ma.
R. Mascuana.4. Sumilhig executed a Deed of Sale of Real Property[7] on a portion
of Lot No. 124-B with an area of 469 square meters and the improvements thereon,
in favor of Corazon Layumas, the wife of Judge Rodolfo Layumas, for the price of
P11,000.00. The spouses Layumas then had the property subdivided into two lots:
Lot No. 124-B-2 with an area of
71 square meters under the name of Jesus Mascuana, and Lot No. 124-B-1, with an
area of 469 square meters under their names.5. the spouses Layumas allowed
Aquilino Barte to stay on a portion of the property to ward off squatters.[10] Barte
and his kin, Rostom Barte, then had their houses constructed on the property.6.
Corazon Layumas wrote Pepito Mascuana, offering to pay the amount of
P1,000.00, the balance of the purchase price of the property under the deed of
absolute sale executed by Mascuana and Sumilhig on August 12, 1961.[12]
However, the addressee refused to receive the mail matter.[13]7. Unknown to
spouses layumas, Lot no.124-B was issued in the name of Jesusa Mascunana.8. the
heirs of Mascuana filed a Complaint[15] for recovery of possession of Lot No. 124-B
and damages with a writ of preliminary injunction, alleging that they owned the
subject lot by virtue of successional rights from their deceased father. They averred

that Barte surreptitiously entered the premises, fenced the area and constructed a
house thereon without their consent. 9. Barte admitted having occupied a portion
of Lot No. 124-B, but claimed that he secured the permission of Rodolfo Layumas10.
the spouses Layumas filed a Motion for Leave to Intervene alleging that they were
the true owners of the subject property11. Hence this petition for review on
certiorari of the Decision[1] of the Court of Appeals (CA) in CA affirming the
Decision[2] RTC which ordered the dismissal of the petitioners complaint for
recovery of possession and damages.ISSUE: whether or not THE SALE OF LOT NO.
124-B MADE BY JESUS M. MASCUANA IN FAVOR OF DIOSDADO SUMILHIG A
CONTRACTTO SELL OR CONTRACT OF SALE. (petitioners are contending contract to
sell)HELD: contract of sale. While it is true that Jesus Mascuana executed the deed
of absolute sale over theproperty on August 12, 1961 in favor of Diosdado Sumilhig
for P4,690.00, and that itwas only on July 6, 1962 that TCT No. 967 was issued in his
name as one of the co-owners of Lot No. 124, Diosdado Sumilhig and the
respondents nevertheless acquiredownership over the property. The deed of sale
executed by Jesus Mascuana in favor

of Diosdado Sumilhig on August 12, 1961 was a perfected contract of sale over
theproperty. It is settled that a perfected contract of sale cannot be challenged on
theground of the non-transfer of ownership of the property sold at
that time of theperfection of the contract, since it is consummated upon
delivery of the property to thevendee. It is through tradition or delivery that the
buyer acquires ownership of theproperty sold. As provided in Article 1458 of the
New Civil Code, when the sale is madethrough a public instrument, the execution
thereof is equivalent to the delivery of thething which is the object of the contract,
unless the contrary appears or can be inferred. The record of the sale with the
Register of Deeds and the issuance of the certificate oftitle in the name of the buyer
over the property merely bind third parties to the sale. Asbetween the seller and
the buyer, the transfer of ownership takes effect upon theexecution of a
public instrument covering the real property.[31] Long before thepetitioners
secured a Torrens title over the property, the respondents had been in
actualpossession of the property and had designated Barte as their overseer.(article
1458)In this case, there was a meeting of the minds between the vendor andthe
vendee, when the vendor undertook to deliver and transfer ownership over
theproperty covered by the deed of absolute sale to the vendee for the price of
P4,690.00of which P3,690.00 was paid by the vendee to the vendor as down
payment. Thevendor undertook to have the property sold, surveyed and
segregated and a separatetitle therefor issued in the name of the vendee, upon
which the latter would be obliged topay the balance of P1,000.00. There was no
stipulation in the deed that the title to theproperty remained with the vendor, or
that the right to unilaterally resolve the contractupon the buyers failure to pay

within a fixed period was given to such vendor. Patently,the contract executed by
the parties is a deed of sale and not a contract to sell. Applying these principles of
DIGNOS vs CA to this case, it cannot be gainsaid that the contract of sale between
the parties is absolute, not conditional. There is no reservation of ownership nor a
stipulation providing for a unilateral rescission by either party. In fact, the sale was
consummated upon the delivery of the lot to respondent. Thus, Art. 1477 provides
that the ownership of the thing sold shall be transferred to the vendee upon the
actual or constructive delivery thereof.[33]The condition in the deed that the
balance of P1,000.00 shall be paid tothe vendor by the vendee as soon as the
property sold shall have beensurveyed in the name of the vendee and all papers
pertinent and necessary tothe issuance of a separate certificate of title in the name
of the vendee shallhave been prepared is not a condition which prevented the
efficacy of thecontract of sale. It merely provides the manner by which the total
purchaseprice of the property is to be paid.In a contract to sell, ownership is
retained by a seller and is not to betransferred to the vendee until full payment of
the price. Such payment is apositive suspensive condition, the failure of which is
not a breach of contract
but simply an event that prevented the obligation from acquiring binding force.
[35]It bears stressing that in a contract of sale, the non-payment of the price isa
resolutory condition which extinguishes the transaction that, for a
time,existed and discharges the obligation created under the transaction.[36] A
sellercannot unilaterally and extrajudicially rescind a contract of sale unless there
isan express stipulation authorizing it. In such case, the vendor may file anaction
for specific performance or judicial rescission.[37]Article 1169 of the New Civil Code
provides that in reciprocal obligations,neither party incurs in delay if the other does
not comply or is not ready tocomply in a proper manner with what is
incumbent upon him; from themoment one of the parties fulfills his obligation,
delay by the other begins. Inthis case, the vendor (Jesus Mascuana) failed to
comply with his obligationof segregating Lot No. 124-B and the issuance of a Torrens
title over theproperty in favor of the vendee, or the latters successorsin-interest, therespondents herein. Worse, petitioner Jose Mascuana was able to
securetitle over the property under the name of his deceased father