G.R. No. 126712 - Quinto vs. People

On October 8, 1996, petitioners Michael Uy and Bonita Uy purchased 200 square meters of Lot No. 3229-C-2-F from respondents.
The sale contract included a right of choice clause, which allowed the petitioners to designate which specific portion of the lot they wished to acquire.
The petitioners exercised this right within two to three months by informing the respondents of their selection and subsequently taking possession of the chosen parcel.

On August 4, 1997, the petitioners purchased an additional 200 square meters from the same lot, again with the option to choose the portion to be occupied.
They selected and occupied an adjoining portion to the first parcel they acquired.

The parcels chosen by the petitioners were already titled in the names of the Delgados (Carlos, Allan, and Antonio, Jr.), despite being originally part of Lot No. 3229-C-2-F.
These parcels were among approximately 3,500 square meters that respondents had purportedly sold to the Delgados on July 31, 1985.
This deed of sale to the Delgados was subsequently annotated on TCT No. T-20007 on June 10, 1993, with a new title (TCT No. T-39106) issued on April 21, 1994, also recorded on TCT No. T-20007.
As a result, at the time petitioners made their purchase, the parcels they chose had already been separated from the original lot and were identified under a separate title (TCT No. T-39106).

The petitioners later faced an unlawful detainer suit filed by the Delgados, leading to a compromise agreement in September 1998 wherein the petitioners surrendered possession of the disputed parcels without notifying respondents.
After the compromise, the petitioners demanded that the respondents allow them to re-exercise their right of choice from Lot No. 3229-C-2-F. When the respondents refused, petitioners filed, on March 12, 1999, a case for specific performance with a demand for delivery of possession and damages.
Petitioners based their claim on the contention that they were deprived of the agreed-upon opportunity to choose the parcel as the portion they pointed out was no longer deliverable by respondents due to the prior sale to the Delgados.

Respondents filed their answer and raised special and affirmative defenses, asserting that they had already complied with their delivery obligation since petitioners had chosen and taken possession of the parcels.
They argued that petitioners lost possession voluntarily by entering into a compromise with the Delgados and for failing to implead respondents as third-party defendants in the unlawful detainer suit.
The trial court denied the respondents’ motion to dismiss and their subsequent motion for reconsideration.

The Court of Appeals reversed the trial court’s decision, holding that petitioners did not have a proper cause of action against the respondents for specific performance.
The appellate court determined that the appropriate remedy for petitioners would be an action for enforcement of warranty against eviction.
Petitioners raised two main issues for review: whether their complaint stated a cause of action for specific performance and whether the trial court’s denial of the motion to dismiss was properly subject to certiorari.

Whether the complaint filed by the petitioners in the RTC sufficiently stated a cause of action for specific performance with delivery of possession of the real property and damages against the respondents.
Whether the petitioners’ allegation that respondents failed to deliver the proper portion of the property is tenable.

Whether specific performance is the proper legal remedy under the circumstances, given that the petitioners had already exercised their right of possession, even though the parcels later came under dispute.
Whether the proper remedy should have instead been an action for enforcement of warranty against eviction.

Whether the RTC’s denial of the motion to dismiss for lack of a cause of action was a proper subject matter for review under the special appellate remedies.