Case Digest (G.R. No. 120567)
Facts:
In Rebecca C. Young, assisted by her husband Antonio Go, vs. Court of Appeals et al. (G.R. No. 79518, January 13, 1989), the property owner Philippine Holding, Inc. obtained a demolition order against its two‐storey building on Soler Street, Sta. Cruz, Manila. Tenants included Antonio Young (Unit 1352), Rebecca C. Young (Unit 1354), Spouses Chui Wan and Felisa Tan Yu (Unit 1356), and Spouses Fong Yook Lu and Ellen Yee Fong (Unit 1358). Antonio Young filed Civil Case No. 123883 seeking annulment of the demolition order. On September 24, 1981, the parties submitted a Compromise Agreement whereby Antonio and Rebecca Young agreed to vacate within sixty days but secured a right of first refusal should Philippine Holding decide to sell. Unbeknownst to Rebecca, Philippine Holding had already executed a dacion in payment to PH Credit Corporation on September 17, 1981. The property was later subdivided and titled to PH Credit, which sold Rebecca’s portion (TCT No. 152439) to Blessed LandCase Digest (G.R. No. 120567)
Facts:
- Property Ownership and Tenancy
- Philippine Holding, Inc. (PHI) owned a land parcel at Soler St., Sta. Cruz, Manila, with a two-storey building divided into six units:
- Unit 1350 – vacant
- Unit 1352 – occupied by Antonio S. Young
- Unit 1354 – occupied by Rebecca C. Young
- Unit 1356 – occupied by Chui Wan and Felisa Tan Yu
- Unit 1358 – occupied by Fong Yook Lu and Ellen Yee Fong
- Unit 1360 – occupied by Guan Heng Hardware
- The City Engineer of Manila ordered demolition of the building.
- Compromise Agreement in Civil Case No. 123883
- Antonio S. Young sued PHI to annul the demolition order; parties submitted a compromise agreement on September 24, 1981.
- Paragraph 3 bound Antonio Young, Rebecca Young, and all claiming under them to vacate Units 1352 and 1354 within 60 days from notice, subject to a proviso granting Antonio and Rebecca a right of first refusal should PHI decide to sell the property.
- PHI had already executed a dacion in payment of the same property in favor of PH Credit Corporation (PHCC) on September 17, 1981.
- Subsequent Property Transactions
- On November 9, 1982, PHCC subdivided the property into:
- TCT No. 152439 – 244.09 sqm (Units 1350, 1352, 1354)
- TCT No. 152440 – 241.71 sqm (Units 1356, 1358, 1360)
- December 8, 1982 – PHCC sold TCT 152439 to Blessed Land Development Corp., represented by its president Antonio T.S. Young.
- September 16, 1983 – PHCC sold TCT 152440 to spouses Fong Yook Lu and Ellen Yee Fong.
- Trial Court Proceedings (Civil Case No. 84-22676)
- Plaintiffs Rebecca C. Young, Chui Wan, and Felisa Tan Yu filed for:
- Annulment of Sale in favor of the Fong spouses;
- Specific Performance;
- Damages against PHI and PHCC.
- They claimed infringement of their right of first refusal under the compromise agreement’s proviso.
- The Regional Trial Court dismissed the complaint and counterclaims, ruling:
- Rebecca was not a party to the September 24, 1981 compromise and did not sign or formally accept it;
- No demand for the right of first refusal was made prior to sale;
- No communication of acceptance of a stipulation pour autrui under Article 1311, Civil Code.
- Appellate and Supreme Court Proceedings
- August 7, 1987 – Court of Appeals affirmed the trial court’s dismissal for lack of merit.
- Rebecca, assisted by her husband Antonio Go, filed a petition for review on certiorari to the Supreme Court, assigning errors that:
- She could enforce the stipulation despite not being a party;
- No communication of acceptance was required.
- Procedural motions (motion to dismiss, comments, replies, memoranda) ensued; petition was given due course on May 11, 1988.
Issues:
- Can a person who was not a party to a compromise agreement enforce a stipulation contained therein?
- If the stipulation is a stipulation pour autrui (benefit of a third person), is communication of acceptance to the obligor required before enforcement?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)