Case Digest (G.R. No. 166862)
Facts:
Manila Metal Container Corporation v. Philippine National Bank, G.R. No. 166862, December 20, 2006, First Division of the Supreme Court, Callejo, Sr., J., writing for the Court. Petitioner Manila Metal Container Corporation (MMCC) owned an 8,015 sq.m. lot in Mandaluyong covered by TCT No. 332098. To secure loans from Philippine National Bank (PNB) MMCC executed a real estate mortgage and, after default, PNB filed an extrajudicial foreclosure petition on August 5, 1982; the property was sold at public auction on September 28, 1982 to PNB, which obtained a Certificate of Sale later annotated on the title, and the statutory period to redeem expired February 17, 1984.Beginning August 1983 MMCC sought additional time and sought to repurchase the property; the PNB Special Assets Management Department (SAMD) prepared a Statement of Account (June 8, 1984) recommending a repurchase price of P1,574,560.47 and MMCC paid P725,000 on June 25, 1984 as a “deposit to repurchase,” expressly accepted by PNB subject to approval by PNB’s Board. SAMD’s recommendation was transmitted upward and PNB management returned the recommendation requesting a higher price (P2,660,000.00) in late 1984.
On June 4, 1985 SAMD wrote MMCC that the Board had accepted MMCC’s offer but on terms and at a different amount (a Statement of Account dated May/31/85 showed a total bank claim of P1,931,389.53) and set conditions including payment of the balance in cash within sixty days and other terms; MMCC did not signify conformity and continued negotiating. PNB later offered to refund the P725,000 and told MMCC to submit an amended offer; MMCC refused the higher terms and maintained the lower price it claimed was accepted by SAMD.
MMCC filed suit on August 28, 1989 for annulment of the mortgage and/or specific performance and damages, later submitting an amended complaint. The parties stipulated facts and limited the issues to whether the June 4, 1985 letter was valid/enforceable, whether MMCC waived its right by not conforming, and whether a perfected contract of sale existed. The Regional Trial Court (Branch 71, Pasig City) rendered judgment on May 31, 1994 dismissing MMCC’s amended complaint and PNB’s counterclaim and ordered refund of the P725,000, ruling there was no perfected contract and that the P725,000 was a deposit, not earnest money.
MMCC appealed to the Court of Appeals; on May 11, 2000 the CA (in CA‑G.R. No. 46153) affirmed the RTC, holding there was no meeting of the minds as to price and the June 4, 1985 letter was at mo...(Pro-only)
Issues:
- Was there a perfected contract of sale between MMCC and PNB for the repurchase of the property?
- Did the P725,000 remitted by MMCC constitute “earnest money” that, under Article 1482, proved perfection of a contract of sale?
- Did MMCC’s failure to signify conformity to the June 4, 1985 letter operate as a waiver or rejection such that no enforceable contract existed?
- Does nonpayment of the balance within sixty (60) days from notice of approval preclude the existence of a perfected contract of sale?
- Do MMCC’s later offers during litigation (1993 offers) d...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)