G.R. No. L-13018 - Rosario vs. Rosario

On June 8, 1953, the parties—Adela Rosario, et al. (plaintiffs/appellants) and Maria S.F. Rosario (defendant/appellee)—entered into a contract of sale with a right to repurchase.
The subject matter of the contract is a parcel of land located in Binmaley, Pangasinan.

The contract provided for a right of repurchase (pacto de retro) by the vendor.
The period allowed for the redemption by the vendor was explicitly stipulated to be within one year from the date of the contract, expiring on June 8, 1954.

Despite several attempts, the plaintiffs were unsuccessful in repurchasing the property within the prescribed one-year redemption period.
This failure to act within the specified timeframe was a critical factor in the dispute, as it triggered the automatic consolidation of ownership provisions.

Following the expiration of the redemption period, the plaintiffs filed an action in the Court of First Instance of Pangasinan, pleading for the reconveyance of the property from the defendant.
The defendant admitted to the material allegations in the complaint but moved to dismiss the action on the ground of lack of cause of action.

The lower court rendered judgment dismissing the complaint.
After the denial of a motion for reconsideration, the plaintiffs appealed the decision, leading to the present review.

The appellants contended that, because the right of repurchase period had expired, the appellee (defendant) had not acquired title since there was no consolidation of ownership as required by Article 1607 of the new Civil Code.
The contention was based on the interpretation that a judicial order was necessary for the consolidation of ownership, similar to the old requirement which could otherwise be fulfilled by an affidavit to the Register of Deeds.

Whether the expiration of the redemption period in a deed of sale with right to repurchase automatically consolidates title in the vendee by operation of law.
Whether there is a need for a judicial order for the consolidation of ownership in the context of a sale with right to repurchase, as purportedly required by Article 1607 of the new Civil Code.
Whether the appellants' reliance on Article 1607 and the proper application of Article 1606 was appropriate to prevent the consolidation of ownership in this particular case.
How the interpretation and application of the statutory provisions (both from the old and the new Civil Code) affect the rights of the parties after the failure of the vendor to repurchase within the stipulated period.