G.R. No. 140228 - Medina vs. Greenfield Development Corp.

Alfredo N. Aguila, Jr. (petitioner) is manager of A.C. Aguila & Sons, Co., a partnership engaged in lending activities.
Felicidad S. Vda. de Abrogar (private respondent) and her late husband, Ruben M. Abrogar, were registered owners of a house and lot in Marikina, Metro Manila, covered by TCT No. 195101.

Under the Memorandum of Agreement, A.C. Aguila & Sons, Co. agreed to buy the property for ₱200,000, with respondent given a 90-day option to repurchase at ₱230,000. Failure to repurchase would obligate surrender of possession and payment of liquidated damages of ₱10,000 per month for delay.
On the same date, the parties executed an undated Deed of Absolute Sale (dated June 11, 1991) conveying the property for ₱200,000, and a Special Power of Attorney authorizing cancellation of the original title and issuance of a new TCT in favor of the partnership if redemption failed.

Private respondent did not repurchase within 90 days; petitioner caused cancellation of TCT No. 195101 and issuance of TCT No. 267073 in the partnership’s name.
A.C. Aguila & Sons, Co. filed ejectment in Metropolitan Trial Court (MTC) Branch 76, which ruled in its favor (April 3, 1992). Respondent’s appeals to the Regional Trial Court (RTC), the Court of Appeals (CA), and the Supreme Court were all denied.

Private respondent filed for nullity of the Deed of Absolute Sale, alleging forgery of her late husband’s signature, since he died on May 8, 1991—before the June 11, 1991 date on the deed.
A prior criminal complaint for falsification against petitioner was dismissed (February 14, 1994).

RTC Branch 273 held that all documents (MOA, SPA, and deed) were signed on April 18, 1991, before husband’s death, and dismissed the nullity petition, recognizing the practice of undated deeds in realty-secured loans.

The CA reversed RTC, characterizing the transaction as an equitable mortgage under Article 1602 of the Civil Code owing to inadequate price (₱833.33/sq.m.), retention of possession by respondent, and her continuous payment of realty taxes.
It found a pactum commissorium in violation of Article 2088, declared the deed and title cancellation void, reinstated TCT No. 195101, and ordered respondent to pay ₱230,000 within 90 days or authorize public auction.

Petitioner contended he was not the real party in interest (the proper party should be the partnership).
He argued the ejectment judgment barred the nullity complaint.
He maintained the agreement was a pacto de retro sale (contract to repurchase), not an equitable mortgage.

Whether petitioner, a partner and agent, is the real party in interest in the nullity action, or whether the partnership A.C. Aguila & Sons, Co. should have been impleaded.
Whether the prior ejectment decision constitutes a bar to the nullity suit (res judicata or collateral estoppel).
Whether the sale with right to repurchase is a pacto de retro sale or an equitable mortgage (and thus void as pactum commissorium).