Title
Arroyo, Jr. vs. Taduran
Case
G.R. No. 147012
Decision Date
Jan 29, 2004
Cousins' verbal agreement to form a corporation led to a condominium purchase, loan repayment via time deposit, and a legal dispute over title transfer and indemnification.
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Case Digest (G.R. No. 147012)

Facts:

  1. Parties and Relationship: Respondent Eduardo Taduran and petitioner Cristino Arroyo, Jr. are cousins.
  2. Verbal Agreement: In 1988, they entered into a verbal agreement to form a corporation and acquire a suitable office.
  3. Purchase of Condominium Unit: Pursuant to the agreement, petitioner Cristino Arroyo, Jr. purchased a condominium unit from Cityland Development Corporation for P348,718.30.
  4. Loan and Guarantee: The purchase was financed through a loan from the Commercial Bank of Manila (now Bank of Commerce), guaranteed by respondent Taduran’s time deposit of P500,000 in the same bank.
  5. Application of Time Deposit: When the loan matured, respondent Taduran applied his time deposit to pay the loan.
  6. Title Issued to Petitioners: Title to the condominium unit was issued in the name of petitioner Cristino Arroyo, Jr. and his wife, Sandra Arroyo.
  7. Foreclosure and Redemption: Petitioners failed to pay certain obligations to Cityland, leading to the extrajudicial foreclosure of the property, which they later redeemed.
  8. Demand for Reconveyance: Respondent discovered petitioners were using the property and demanded the transfer of title to his name based on their verbal agreement.
  9. Legal Action: When petitioners refused, respondent filed a complaint for specific performance, reconveyance, and damages in the Makati RTC.

Issue:

  1. Existence of Agency: Whether a principal-agent relationship existed between respondent Taduran and petitioner Cristino Arroyo, Jr. requiring the transfer of title to the condominium unit.
  2. Entitlement to Indemnification: Whether respondent Taduran is entitled to indemnification for the P500,000 time deposit applied to the loan of petitioner Cristino Arroyo, Jr.
  3. Propriety of Relief Granted: Whether the trial court and Court of Appeals erred in ordering indemnification despite the absence of a specific prayer for it in the complaint.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

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