Case Digest (G.R. No. 167379) Core Legal Reasoning Model
Core Legal Reasoning Model
Facts:
In Primelink Properties and Development Corporation v. Ma. Clarita T. Lazatin-Magat, the petitioners, Primelink and its President Rafaelito W. Lopez, entered into a Joint Venture Agreement (JVA) on March 10, 1994 with respondents Ma. Clarita T. Lazatin-Magat and her three brothers, co-owners of two adjacent parcels of land in Tagaytay City (TCT No. T-10848, total area 30,000 sqm). Under the JVA, the Lazatins contributed the land while Primelink agreed to provide funds, labor, machinery, permits and managerial expertise to develop a residential subdivision branded “Tagaytay Garden Villas.” They fixed profit and advance withdrawals (60% to developer, 40% to landowners), detailed project plans and a Voluntary Arbitration clause for disputes. Primelink secured the development permit only in October 1995. By April 1997, dissatisfied with delays, the Lazatins demanded performance and then rescinded the JVA in October 1997. They filed a complaint for rescission, accounting, damages and Case Digest (G.R. No. 167379) Expanded Legal Reasoning Model
Expanded Legal Reasoning Model
Facts:
- Parties and Joint Venture Agreement (JVA)
- Primelink Properties and Development Corporation (developer), represented by its President Rafaelito W. Lopez.
- Ma. Clarita T. Lazatin-Magat and her brothers Jose Serafin, Jaime Teodoro and Jose Marcos Lazatin (landowners), co-owners of two adjoining parcels (30,000 sqm) in Tagaytay City under TCT No. T-10848.
- Key Terms of the JVA (March 10, 1994)
- Land Contribution and Developer Obligations
- Landowners contribute titles and possession of the parcels.
- Developer to survey, plan, secure permits, provide labor, materials, equipment, marketing, management and complete development within 3 years (force majeure excepted).
- Financial Arrangements
- Profit sharing: 60% developer, 40% landowners.
- Advances: up to 20% net revenue in first two years (60/40 split), thereafter 60/40 of total net revenue.
- Arbitration clause for disputes and an escrow agreement depositing the owner’s duplicate title with China Banking Corporation.
- Breach, Rescission and Trial Proceedings
- Alleged Breaches by Primelink:
- Delay in securing development permit; poor progress in phases I and II; complaints of substandard construction.
- Failure to provide agreed accounting and hold regular meetings.
- Lazatins’ Actions:
- April 10, 1997 demand letter; October 22, 1997 formal rescission.
- Filed suit (Jan 19, 1998, RTC Tagaytay, Civil Case No. TG-1776) for rescission, accounting, damages, and injunctive relief.
- Trial Court Rulings:
- Primelink defaulted after repeated extensions to answer; ex parte trial.
- RTC Decision (Apr 17, 2000): rescinded JVA; returned land and improvements; awarded P1,041,524.26 (40% of net income as of Sept 30, 1995), attorney’s fees and costs.
- Appeals and Final Resolution:
- CA (Aug 9, 2004) affirmed with modification: released TCT from escrow; cancellation of JVA annotation.
- SC denied Rule 45 petition (June 27, 2006), affirming CA decision.
Issues:
- Whether the Court of Appeals erred in ordering respondents to receive possession of the property with all improvements without first requiring them to reimburse petitioners for development and marketing expenses.
- Whether such award is illegal, oppressive, or unconscionable and results in unjust enrichment, contrary to provisions on rescission, restitution and partnership law.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)