Case Digest (G.R. No. 107624)
Facts:
Gamaliel C. Villanueva and Irene C. Villanueva alleged that private respondents Spouses Jose and Leonila dela Cruz offered for sale their apartment property in Quezon City, and that the parties agreed that PHP 10,000.00 advanced for realty taxes would form part of a PHP 550,000.00 price, with the property later subdivided and titles issued. The Regional Trial Court dismissed petitioners’ action for specific performance but ordered Jose de la Cruz to refund PHP 10,000.00; the Court of Appeals affirmed. Petitioners then sought review under Rule 45, contending that a perfected contract of sale existed, that the Statute of Frauds should not apply, and that the law on double sale and good faith should govern.
Issues:
- Was there a perfected contract of sale under the attendant facts and circumstances?
- Did the Statute of Frauds apply where petitioners claimed the contract was partly executed?
- Does the law on double sale apply such that possession in good faith should confer ownership effects?
- Should the courts below have granted petitioners’ prayer for specific performance?
Ruling:
The Court denied the petition and affirmed the decision of the Court of Appeals.
The Court held that petitioners failed to prove an essential element of sale: a certain price, and thus no perfected contract of sale existed. It further ruled that the Statute of Frauds and the law on double sale had no relevance because there was no sale to enforce and no double sale to consider.
Ratio:
The Court found that the lower courts’ factual conclusions were not overcome by petitioners and that the evidence did not establish a definite agreement as to price. While petitioners relied on their claimed understanding and on the supposed preparation of a deed of sale, the Court noted that the draft deed was not presented, that even if it existed it was not signed, and that petitioners failed to take steps to procure it.
Because there was no meeting of minds on the price—expressly or impliedly—there was no true consent, hence no sale. Petitioners’ readiness to pay was likewise immaterial since private respondents could not be compelled to accept payment absent a perfected contract. With no perfected sale, the Court ruled that the Statute of Frauds did not come into play, and the rules on double sale were inapplicable.
Doctrine:
- Sale is a consensual contract, and the party alleging its existence must prove it by competent evidence.
- A contract of sale cannot exist without a certain price; without proof of price, there is no true consent.
- Earnest money delivered as part of the purchase price must be intended as such by the parties; otherwise it does not prove perfection.
- The Statute of Frauds presupposes the existence of a perfected contract that can be enforced via a required note or memorandum.
- The rules on double sale do not apply where there was no sale to begin with.