Title
Aquino vs. Deala
Case
G.R. No. 43304
Decision Date
Oct 21, 1936
A contract initially believed to be a sale with a right of repurchase is determined to be a loan secured by real property, leading to a dispute over ownership and jurisdiction in the case of Aquino v. Deala.
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Case Digest (G.R. No. 43304)

Facts:

  • Case: Aquino v. Deala (G.R. No. 43304)
  • Date: October 21, 1936
  • Parties: Plaintiff-appellee Antonio F. Aquino, special administrator of the estate of Mariano Aquino; Defendant-appellant Tomas Deala.
  • Nature of Dispute: Ejectment case involving a contract initially perceived as a sale with a right of repurchase but later determined to be a loan secured by real property.
  • Property: Described in original certificate of title No. 5014, located at 670 Tanduay Street, Manila.
  • Contract Details: Executed on September 25, 1926, involving a sum of P4,000 received by Deala from Mariano Aquino; included stipulations such as the construction of a two-story house by Deala and payment of rent.
  • Contract Evolution: Novated multiple times, increasing the loan amount and adjusting the rent.
  • Procedural History: Municipal court of Manila ruled in favor of the plaintiff, ordering Deala to vacate the property and pay unpaid rents; decision affirmed by the Court of First Instance of Manila.
  • Defendant's Contention: Deala argued that the contract was a loan and not a sale with a right of repurchase.

Issue:

  • (Unlock)

Ruling:

  • Nature of Contract: The Supreme Court ruled that the contract was a simple loan secured by real property and not a sale with a right of repurchase.
  • Jurisdiction: The Supreme Court held that the Court of First Instance should have declared itself without jurisdiction to pr...(Unlock)

Ratio:

  • Doctrine Reiterated: The Supreme Court reiterated the doctrine from Padilla vs. Linsangan (19 Phil., 65) that a contract will not be construed as a sale with a right of repurchase unless the terms and circumstances positively require it.
  • Contract Stipulations: The stipulations such as Deala’s obligation to construct a house and pay for insurance and taxes were incompatible with a sale, indicating a loan secured by real property.
  • Parties' Intention: The intention of the parties, as evidenced by their conduct and the contract terms, indicated a loan agreement.
  • Jur...continue reading

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