Case Digest (G.R. No. 1362)
Facts:
Leberman Realty Corporation and Aran Realty and Development Corporation v. Joseph Typingco and the Court of Appeals, G.R. No. 126647, July 29, 1998, Supreme Court Third Division, Kapunan, J., writing for the Court.The petitioners, Leberman Realty Corporation and Aran Realty and Development Corporation (co-owners of four parcels in Binondo, Manila), entered into negotiations with respondent Joseph Typingco in March–April 1989. On March 20, 1989 Typingco made an initial P100,000 downpayment; on April 4, 1989 the parties executed a Contract to Sell for P43,888,888.88. The contract provided for a total downpayment of P200,000, a balance structure (70% payable within seven days after notice that tenants/squatters had vacated, 30% payable after notice of tax payment), and an express clause giving the buyer an option from the 7th to the 18th month (i.e., from November 1989 to October 1990) either to pay the balance and demand a deed of absolute sale or to cancel/rescind; after the 18th month the contract would be automatically cancelled if the buyer failed to exercise the option, with the downpayment returned without interest.
On September 11, 1989 petitioners sent Typingco letters stating that their boards had adopted resolutions rejecting/cancelling the Contract to Sell as grossly disadvantageous and beyond the authority of the officers who executed it, enclosing checks returning the P200,000 downpayment. Typingco returned those checks and, alleging unilateral repudiation, filed suit in the Regional Trial Court (Manila) on September 26, 1989 for specific performance and damages (Civil Case No. 89-50512).
In their joint answer petitioners pleaded, among others, prematurity (that the cause of action accrued only when the option period began in November 1989), lack of authority/duress, and later argued that the plaintiff had lost any claim by electing automatic cancellation for failure to exercise the option during the 18‑month period. The trial court initially denied a motion to dismiss (Dec. 15, 1989), and subsequently denied reconsideration (Jan. 26, 1990). After trial began and the plaintiff rested, petitioners renewed a motion to dismiss on the ground that the contract had been automatically cancelled when the 18‑month option period lapsed without exercise; the trial court denied this motion on December 13, 1990, but then granted the defendants' motion for reconsideration and dismissed the case on July 8, 1991. Typingco's motion for reconsideration was denied (Dec. 9, 1991).
Typingco appealed to the Court of Appeals, which on May 13, 1996 reversed the July 8, 1991 RTC order, reinstated the December 13, 1990 order denying dismissal, and remanded the case for further procee...(Subscriber-Only)
Issues:
- Was the complaint filed by Typingco prematurely instituted — i.e., had his cause of action accrued when he filed on September 26, 1989?
- Did Typingco forfeit or extinguish any cause of action by allowing the contract's 18‑month option period to lapse (thereby effecting automatic cancellation)?
- Did the Court of Appeals' decision violate or disregard the doctrine in Ang Ti...(Subscriber-Only)
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)