Case Digest (G.R. No. 202079) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
In Fil-Estate Golf and Development, Inc. (FEGDI) and Fil-Estate Land, Inc. (FELI) vs. Vertex Sales and Trading, Inc., decided on June 10, 2013 under G.R. No. 202079, FEGDI, a corporation developing the Forest Hills Golf and Country Club, sold on installment on August 1997 one Class “C”a common share of Forest Hills to RS Asuncion Construction Corporation (RSACC) for ₱1,100,000.00. Before full payment, RSACC transferred the share to Vertex on February 11, 1999, and FEGDI instructed Forest Hills to recognize Vertex as shareholder, enabling it to use club facilities. Although Vertex completed payment, the corresponding stock certificate remained registered in FEGDI’s name. Seventeen months later, Vertex formally demanded a certificate; upon partial compliance with transfer fees, FEGDI still failed to deliver the document. On March 17, 2001, Vertex made a final demand and filed on January 7, 2002 a Complaint for Rescission with Damages and Attachment against FEGDI, FELI, and Forest Case Digest (G.R. No. 202079) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Parties and Subject Matter
- Fil‐Estate Golf and Development, Inc. (FEGDI) – stock corporation developing golf courses; developer of Forest Hills Golf and Country Club (Forest Hills).
- Fil‐Estate Land, Inc. (FELI) – stock corporation engaged in real estate development; not a party to the original sale contract.
- RS Asuncion Construction Corporation (RSACC) – initial buyer of one Class “C” Common Share of Forest Hills.
- Vertex Sales and Trading, Inc. (Vertex) – ultimate purchaser of the aforementioned share from RSACC.
- Chronology of Transactions and Procedural History
- August 1997 – FEGDI sells on installment basis one Class “C” Common Share of Forest Hills to RSACC for ₱1,100,000.00.
- February 11, 1999 – Before full payment to FEGDI, RSACC transfers the share to Vertex; FEGDI instructs Forest Hills to recognize Vertex as shareholder.
- July 28, 2000 – Vertex demands issuance of stock certificate in its name; asked to pay transfer fees.
- March 17, 2001 – Final demand by Vertex for issuance of certificate goes unheeded.
- January 7, 2002 – Vertex files Complaint for Rescission with Damages and Attachment against FEGDI, FELI, and Forest Hills under Article 1191, Civil Code.
- January 23, 2002 – Forest Hills issues stock certificate in Vertex’s name; Vertex refuses to accept it.
- RTC, Pasig City, Branch 161 (March 1, 2007) – Dismissal of Vertex’s complaint for insufficiency of evidence; holds delay in issuance of certificate is slight breach and collateral to sale.
- Court of Appeals (February 22, 2012; May 31, 2012) – Reverses RTC; rescinds sale for substantial breach (delay in certificate issuance) and orders return of purchase price; denies damages; holds no liability for FELI.
- Supreme Court (June 10, 2013) – Petition for review on certiorari under Rule 45 filed by FEGDI and FELI.
Issues:
- Primary Issue
- Whether the delay in the issuance of the stock certificate constitutes a substantial breach of the contract of sale of shares sufficient to warrant rescission under Article 1191 of the Civil Code.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)