Case Digest (G.R. No. L-45349)
Facts:
This case involves the spouses Newton Jison and Salvacion I. Jison as petitioners against the Court of Appeals and private respondent Robert O. Phillips & Sons, Inc. The dispute arises from a contract to sell a subdivision lot at the Victoria Valley Subdivision in Antipolo, Rizal. The parties entered into this contract on October 20, 1961, for an agreed purchase price of ₱55,000.00 with interest at 8% per annum, payable in monthly installments. The petitioners initially made a down payment of ₱11,000.00 and subsequently paid ₱533.85 monthly from October 27, 1961, until May 8, 1965. Due to a failure to construct a house as stipulated in the contract, a penalty of ₱5.00 per square meter was levied, increasing the monthly payment to ₱707.24.
From January to March 1966, there were missed payments, although eventually made and accepted by the respondent. Further missed payments ensued between October 1966 and January 1967. On January 11, 1967, the respondent notified the petiti
Case Digest (G.R. No. L-45349)
Facts:
- Background and Contract Formation
- Newton Jison and Salvacion (petitioners) entered into a Contract to Sell with Robert O. Phillips & Sons, Inc. (private respondent) for a lot at the Victoria Valley Subdivision in Antipolo, Rizal.
- The agreed price was P55,000.00 with an interest rate of 8% per annum, payable on an installment basis.
- The contract required a down payment of P11,000.00 made on October 20, 1961, and subsequent monthly installments of P533.85 from October 27, 1961, to May 8, 1965.
- Alteration of Terms and Default in Payment
- Owing to petitioners’ failure to build a house as stipulated in the contract, a penalty of P5.00 per square meter was imposed, increasing monthly installments to P707.24.
- Petitioners defaulted on several scheduled payments:
- January 1, 1966; February 1, 1966; and March 1, 1966, although these were eventually paid and accepted by the respondent.
- Additional defaults on October 1, 1966; November 1, 1966; December 1, 1966; and January 1, 1967.
- Private respondent issued a letter on January 11, 1967, notifying petitioners of an overdue account (four months behind).
- A subsequent letter dated February 27, 1967, reminded petitioners about the automatic rescission clause within the contract.
- Escalation to Cancellation and Litigious Proceedings
- Despite petitioners’ later payment on March 1, 1967, further defaults occurred on February 1, 1967; March 1, 1967; and April 1, 1967.
- By April 1, 1967, petitioners’ account became delinquent for three consecutive months, prompting respondent to send a cancellation notice in a letter dated April 6, 1967, wherein a check was also returned.
- On April 19, 1967, petitioners tendered payment for all overdue installments, but their payment was refused.
- In response, petitioners filed a complaint for specific performance with the Court of First Instance of Rizal on May 4, 1967 and consigned the sums due to the court.
- Judicial Proceedings
- The trial court, after a hearing with a stipulation of facts, issued a judgment on January 9, 1969 in favor of the private respondent, declaring the contract cancelled, dismissing petitioners’ complaint, and ordering forfeiture of payments with an additional P1,000.00 for attorney’s fees.
- The Court of Appeals affirmed the trial court’s decision on November 4, 1976, prompting the present petition for review.
Issues:
- Validity of the Rescission
- Whether the automatic rescission clause in the contract, triggered by non-payment of three or more consecutive monthly installments, was effectively invoked by private respondent.
- Sufficiency of Notice
- Whether the letter sent on April 6, 1967, provided adequate notice of cancellation as required either by the terms of the contract or by law.
- Forfeiture of Payments
- Whether the forfeiture of all payments already made by petitioners is valid or if it should be reduced considering the overall contract price and circumstances of partial compliance.
- Substantial Compliance
- Whether petitioners had substantially complied with the terms of the contract, thereby negating private respondent’s unilateral right to rescind.
- Unconscionability and Iniquity
- Whether the actions of private respondent, including the complete forfeiture of payment and the rejection of consignation, are highly iniquitous and unconscionable under prevailing legal principles.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)