Case Digest (G.R. No. 222957)
Facts:
Atty. Rogelio B. De Guzman, G.R. No. 222957, March 29, 2023, Supreme Court Third Division, Gaerlan, J., writing for the Court. Petitioner is Atty. Rogelio B. De Guzman; respondents are Spouses Bartolome and Susan Santos. The dispute concerns a house and lot (TCT No. 5788) in Taytay, Rizal (the Subject Property) and a written agreement dated November 2000 styled a "Contract to Sell" for P1,500,000.00 with a P250,000 down payment and monthly P15,000 installments; the contract reserved transfer of legal title to the vendor until full payment and contained a clause providing for automatic cancellation and forfeiture upon three successive dishonored checks.After paying the down payment and occupying the property, the spouses Santos admitted they did not pay the monthly installments and vacated the property after about four months. In June 2001 the spouses Santos filed a complaint for rescission of the contract, recovery of down payment less a claimed reasonable rental for their occupancy, and damages. The Regional Trial Court (RTC), Branch 73, Antipolo City, initially dismissed the complaint and ordered the spouses Santos to pay the outstanding purchase price with interest (Decision dated June 10, 2008).
The spouses Santos filed a Motion for New Trial claiming discovery of a sale by De Guzman to a third person, Elizabeth Algoso, during the pendency of the action (sale dated August 17, 2005). The RTC granted the motion, tried the case anew, and by Order dated January 31, 2013 set aside its earlier decision, declared the Contract to Sell rescinded on the ground that De Guzman’s sale during litigation constituted bad faith and rendered enforcement moot, and ordered De Guzman to return the balance of the down payment with interest less reasonable rental.
De Guzman appealed to the Court of Appeals (CA) in CA-G.R. CV No. 100706. The CA, by Decision dated December 18, 2014 (and Resolution dated February 18, 2016 denying reconsideration), affirmed the RTC: it found that the sale to Algoso without notice or court approval evidenced bad faith, rendered enforcement academic, and justified rescission and reimbursement in the interest of justice. De Guzman filed a Petition for Review on Certiorari under Rule 45 before the Supreme Court seeking reversal of the CA Decision and Resolution.
Issues:
- Whether the Court of Appeals correctly affirmed the rescission of the Contract to Sell.
- Whether Atty. De Guzman is liable to reimburse the spouses Santos their down payment.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)