Case Digest (G.R. No. 175139)
Facts:
Hermojina Estores v. Spouses Arturo and Laura Supangan, G.R. No. 175139, April 18, 2012, Supreme Court, First Division, Del Castillo, J., writing for the Court.Petitioner Hermojina Estores (seller) and respondents Spouses Arturo and Laura Supangan (buyers) executed a Conditional Deed of Sale on October 3, 1993 for a parcel in Naic, Cavite for P4.7 million. The contract required the seller to secure Department of Agrarian Reform (DAR) clearance and to relocate a house on the lot to a 300-sq.m. portion before full payment; it also provided for return of the downpayment if the vendor failed to complete necessary documents within thirty days without sufficient reason.
The spouses paid P3.5 million in several instalments between 1993 and 1998. When the seller did not complete the conditions and did not relocate the house, the spouses sent a demand letter dated September 27, 2000 asking for return of the P3.5 million; the seller acknowledged receipt and promised to return the funds within 120 days but failed to do so. The spouses sought a 12% compounded annual interest on the amount; negotiations failed and they filed a complaint for sum of money (Civil Case No. 3201‑MN) against Hermojina and Roberto U. Arias (alleged agent).
At trial the parties agreed the only remaining issue was whether interest, damages and attorneys’ fees should be awarded. The Regional Trial Court (Branch 170) rendered judgment on May 7, 2004 ordering joint and several payment of P3,500,000 with 6% interest compounded annually from October 1, 1993, attorneys’ fees of P50,000 plus 20% of recoverable amount, and costs; the counterclaim was dismissed. The defendants appealed.
The Court of Appeals, in a May 12, 2006 decision (CA‑G.R. CV No. 83123), affirmed but modified: it held interest at 6% per annum to be computed from September 27, 2000 until full payment before finality, and if unpaid after finality the interest rate would be 12% per annum until satisfied; it reduced attorneys’ fees to P100,000 and absolved Arias...(Subscriber-Only)
Issues:
- Whether interest may be imposed on the P3.5 million payment notwithstanding the absence of an express stipulation, and if so, what rate and from what date should interest run?
- Whether respondents are entitled to attorneys’ fees and, if so,...(Subscriber-Only)
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)