Facts:
Petitioners
Spouses Chin Kong Wong Choi and Ana O. Chua entered into a
Contract to Sell with Primetown Property Group, Inc. (Primetown) for condominium unit
no. A-322 in
Kiener Hills Cebu, in the total consideration of
P1,151,718.75, payable with a down payment of
P100,000.00 and the balance in
40 equal monthly installments of P26,292.97 from
16 January 1997 to 16 April 2000. On
23 April 1998,
respondent United Coconut Planters Bank (UCPB) executed a
Memorandum of Agreement and a
Sale of Receivables and Assignment of Rights and Interests with Primetown, whereby Primetown, in consideration of
P748,000,000.00, assigned, transferred, conveyed, and set over to UCPB
all accounts receivable accruing from Primetown’s Kiener units arising from the relevant contracts to sell, including Spouses Choi’s account, with evidence of one amortization paid to UCPB on
3 February 1999. Despite Spouses Choi’s allegation that they had paid the full purchase price but Primetown failed to complete the project and deliver the unit, they filed on
11 April 2006 a complaint for
refund of money with interest and damages against Primetown and UCPB before the
Housing and Land Use Regulatory Board (HLURB) Regional Field Office No. VI. The HLURB Regional Field Office found that only the
accounts receivable for the condominium unit had been transferred to UCPB and, deeming it unfair to require UCPB to refund all payments when UCPB received only part of the consideration after the assignment, it suspended the proceedings and directed the complainants to file their claim before the rehabilitation receiver. On appeal, the
HLURB Board of Commissioners set aside the suspension as to UCPB and ordered UCPB to refund the full amount paid by Spouses Choi, holding UCPB as the legal successor-in-interest against whom enforcement could be made, and likewise awarded
exemplary damages and
attorneys’ fees against UCPB and Primetown jointly and severally. The
Office of the President affirmed UCPB’s liability on the theory that UCPB, as Primetown’s successor-in-interest, was jointly and severally liable with Primetown for failure to deliver the unit. The
Court of Appeals reversed, applying the doctrine of
stare decisis and adopting its prior rulings in
UCPB v. O’Halloran and
UCPB v. Liam, reinstating the HLURB Regional Field Office decision that suspended proceedings. Spouses Choi sought review, contending, among others, that
estoppel should apply and that the CA should have considered other Supreme Court cases and resolved the effect of the receivables assignment agreement.
Issues:
Whether, under the Agreement between Primetown and UCPB,
UCPB assumed the liabilities and obligations of Primetown under its contract to sell with Spouses Choi, such that UCPB could be held solidarily or fully liable to refund all payments notwithstanding the characterization of the transaction as an assignment of receivables.
Ruling:
Ratio:
Doctrine: