Case Digest (G.R. No. 134219)
Facts:
Spouses Mario and Elizabeth Torcuator v. Spouses Remegio and Gloria Bernabe and Spouses Diosdado and Lourdes Salvador, G.R. No. 134219, June 08, 2005, the Supreme Court Second Division, Tinga, J., writing for the Court. The dispute concerns Lot 17, Block 5, Ayala Alabang Village (569 sq. m.), covered by TCT No. S-79773, originally purchased by Diosdado and Lourdes Salvador from the developer under conditions imposed by Ayala Corporation (including a cash bond refundable upon construction within two years, approval of architectural plans, and a restriction against resale of vacant lots while Ayala retained the Torrens title). The Salvadors sold the lot to Remigio and Gloria Bernabe on December 18, 1980; the Salvadors concurrently executed a special power of attorney authorizing the Bernabes to construct a house and transfer title in their names.Sometime in September 1986 the Torcuators contracted to buy the lot from the Bernabes. Because of the Ayala restrictions, the parties agreed to cancel the Bernabe–Salvador sale and instead effect (a) a deed of sale from the Salvadors to the Torcuators, (b) an irrevocable special power of attorney from the Salvadors to the Torcuators to build in the Salvadors’ name, and (c) an irrevocable power enabling the Bernabes to sell with power of substitution. The Torcuators prepared house plans and offered to pay on delivery of the sale contract, but the deed of sale was never executed nor was payment made; instead the Bernabes allegedly sold the lot to a third person, Leonardo Angeles (document not notarized). The Torcuators filed a complaint for specific performance or, alternatively, rescission with damages.
The Regional Trial Court, Branch 142, Makati (Judge Salvador P. De Guzman, Jr.), issued judgment on August 20, 1991 dismissing the Torcuators’ complaint on grounds that (1) the agreement was a mere contract to sell (ownership remained with the Salvadors until full payment and compliance with Ayala’s condition), (2) there was no payment/tender/consignation, and (3) the contract’s dollar-denomination raised questions under the currency law. The trial court found no real damage to petitioners and likewise dismissed Bernabes’ counterclaim.
The Court of Appeals (Decision dated January 30, 1998, penned by Associate Justice Conrado M. Vasquez, Jr.) affirmed the RTC but added a fourth ground: that the transaction was tainted by an intent to evade payment of taxes (capital gains/documentary taxes) by making it appear the Salvadors sold directly to the Torcuators when in fact there were two transfers. The Court of Appeals denied reconsideration in its Resolution dated June 15, 1998.
The Torcuators filed the instant petition with the Supreme Court assailing the Court of Appeals’ Decision and Resolution. The parties filed memoranda (respondents failed to file theirs and the Court dispensed with their memorandum). The Supreme Court resolved the case by ...(Pro-only)
Issues:
- Was the agreement between the parties a contract of sale or merely a contract to sell?
- Did petitioners validly tender payment or consign the purchase price so as to compel specific performance?
- Were the alleged oral/written instruments sufficient under the Statute of Frauds to make the agreement enforceable?
- Was the transaction void as contrary to good customs and morals or otherwise tainted by an inten...(Pro-only)
Ruling:
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Ratio:
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Doctrine:
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