Heirs of San Miguel v.
Court of Appeals respondents’ payment of the amount of three
GR No. 136054 / Sept. 5, 2001
Facts:
This case involves a parcel of land
originally claimed by Severina San Miguel
(petitioners' predecessor-in-interest, hereafter,
"Severina"). Without Severina's knowledge,
Dominador San Miguel (private respondent)
managed to cause the subdivision of the land into
three (3) lots. Respondent Dominador registered
the two of the three lots to Land Registration
Commission (LRC) in which the latter issued a
title over his favor.
Severina filed with the Court of First
Instance (CFI) of Cavite a petition for review of
the decision alleging that the land registration
was fraudulently against her knowledge. The
court resolves the issue in her favor and declares
the titles owned by Dominador null and void. The
Register of Deeds (RoD) issued a Transfer
Certificate of Title (TCT) over the petitioners.
The trial court issued a Writ of
Possession, and later, an alias Writ of Demolition
against respondent but both of them was not
satisfied. On August 6, 1993, petitioners’ heirs,
decided not to pursue the writs of possession and
demolition and entered into a compromise with
the private respondents. According to the
compromise, petitioners were to sell the subject
lots to private respondents. for one and a half
million pesos (P1.5 M) with the delivery of TCT
conditioned upon the purchase of the remaining
lot which was not yet titled at an additional sum of
three hundred thousand pesos (P300,000.00).
On the same day pursuant to the compromise,
petitioners and private respondents executed a
deed of sale over the lots.
On November 16, 1993, private
respondents filed with the trial court a motion
compelling the petitioners to deliver the owner's
copy of the certificate of title to them. In time,
petitioners opposed the motion stressing that
under the compromise, the certificate of title
would only be surrendered upon private
hundred thousand pesos (P300, 000.00) within
two months from August 6, 1993, which was not
complied with. Private respondents admitted non-
payment for the reason that petitioners have not
presented any proof of ownership over one of the
two parcels of land. Apparently, the questioned
parcel of land is declared in the name of a third
party, a certain Emiliano Eugenio.
Petitioners countered that private
respondents’ argument were untenable since the
latter recognizes petitioners’ ownership over the
parcel of lands under the compromise. Thus,
there is no need for them to produce actual proof
of ownership. Accordingly, since private
respondents were not yet able to pay the amount
stipulated under the compromise, then they were
justified in withholding the TCT.
Issue:
Whether private respondents may be
compelled to pay the three hundred thousand
pesos (P300, 000.00) as agreed upon in the
compromise (as a pre-requisite for the release of
the certificate of title), despite petitioners’ lack of
evidence of ownership over the parcel of land.
Ruling:
The Supreme Court resolve the issue in
the negative, and found the petition without merit.
Petitioners anchored their claim on the
compromise stressing on their freedom to
stipulate and the binding effect of contracts. As
the provisions under the Civil Code provides, in
contracts of sale, the vendor need not possess
title to the thing sold at the perfection of the
contract. However, the vendor must possess title
and must be able to transfer title at the time of
delivery. In a contract of sale, title only passes to
the vendee upon full payment of the stipulated
consideration, or upon delivery of the thing sold.
Under the facts of the case, petitioners
are not in a position to transfer title. Without
passing on the question of who actually owned
the questioned parcel of land, the court noted that
there is no proof of ownership in favor of the
petitioners. Under those circumstances, the
delivery of the title, supposing that the payment
was complied, is impossible. As emphasized
under Article 1183 of the Civil Code, impossible
conditions of a contract cannot be honored and
shall annul the obligation that depends upon
them.

Hence, the non-payment of the three

hundred thousand pesos (P300, 000.00) is not a
valid justification for refusal to deliver the
certificate of title given that the respondents
already paid the remaining two parcels of land in
full.