Case Summary (G.R. No. 146839)
Key Dates
– April 23, 1990: Contract to Sell executed
– July 26, 1990: Conditional Deed of Sale executed and annotated on title
– December 10, 1990: Rodriguez files Complaint for Damages and Injunction (RTC Lapu-lapu City)
– May 30, 1992: RTC Decision in favor of Rodriguez
– August 8, 2000: CA Decision affirming RTC
– January 30, 2001: CA Resolution denying reconsideration
– March 23, 2011: SC Decision under 1987 Constitution
Applicable Law
1987 Philippine Constitution; Civil Code Articles 1181 (conditional obligations), 1182 (potestative conditions), 1191–1197 (rescission; fixing period), 1308 (mutuality), 1373–1374 (contract interpretation); Rule 130, Secs. 11–13, Rules of Court
Facts
– Agapita, with spousal consent, agreed to sell a 65,246 sqm parcel to Rodriguez for P25 million: P500,000 downpayment; balance in five checks (first P4.5 million; four checks of P5 million each) due only after Rodriguez secures a 12 m road right-of-way across Lot 10884 or alternative access.
– Paragraph 5 granted Rodriguez an option to rescind and recover his P500,000 downpayment (interest-free) only after the vendors re-sell to a third party.
– Rodriguez procured surveys, obtained residential reclassification, and actively negotiated passage. Spouses Catungal demanded an early P5 million advance; upon refusal, purported to cancel the contract and offered the property to others.
Procedural History
– RTC issued TRO; then preliminary and permanent injunction; found: (1) vendee had sole option to rescind; (2) payment of balance depended on securing road right-of-way; (3) Rodriguez diligently negotiated; (4) Catungals misrepresented title boundaries and thwarted negotiations; (5) their rescission was bad faith. Award: reduced purchase price; damages P100,000; attorney’s fees P30,000; costs.
– CA affirmed. Catungal heirs’ motion for reconsideration raised, for the first time on appeal, that paragraphs 1(b) and 5 violated mutuality under Art. 1308 and were void ab initio; CA denied.
Issue on Change of Theory on Appeal
Whether petitioners could raise for the first time on appeal that the Conditional Deed’s material conditions were void for lack of mutuality.
SC Ruling on Change of Theory
– A party may not abandon its trial-court theory and adopt a new one on appeal.
– Petitioners never challenged paragraphs 1(b) and 5 for mutuality defect during trial; only in CA reconsideration.
– Allowing such belated theory shifts offends fair play, due process, and the rule that courts decide only on issues pleaded and tried.
– CA correctly disregarded the citation-only authorities and denied reconsideration.
Interpretation of Conditions 1(b) and 5
– Paragraph 1(b): Suspensive condition on vendee’s obligation to pay balance. It is a mixed condition (dependent on third-party landowners and chance), not purely potestative; valid under Art. 1182.
– Paragraph 5: Vendee’s option to rescind is likewise subject to a mixed condition—the failure to s
Case Syllabus (G.R. No. 146839)
Facts
- Agapita T. Catungal owned Lot 10963 (65,246 sqm) in Talamban, Cebu City, covered by OCT No. 105 as her exclusive paraphernal property.
- On April 23, 1990, spouses Catungal (Agapita and Jose) with Rodriguez executed a Contract to Sell, later “upgraded” on July 26, 1990 into a Conditional Deed of Sale, annotated on the title.
- Total consideration: ₱25 million – ₱500,000 downpayment, ₱24.5 million balance in five checks, payable only after Rodriguez secured a 12-meter-wide road right of way across Lot 10884 to the national road. All costs and time for acquisition borne by Rodriguez.
- Paragraph 5 granted Rodriguez an option to rescind if the road right of way could not be obtained, upon written notice and refund of ₱500,000 downpayment only after Catungals sold the property to another.
- Rodriguez secured surveys, reclassification of the property, and pursued negotiations for the road right of way. He alleged Catungals misrepresented included lots, demanded an unauthorized ₱5 million advance, offered the property to third parties, and declared the contract cancelled by letters in October–November 1990.
- Rodriguez filed a Complaint for Damages and Injunction on December 10, 1990, praying for a TRO, preliminary injunction, permanent injunction, actual and moral damages, exemplary damages, attorney’s fees and costs.
Procedural History
- December 12, 1990: RTC Branch 27, Lapu-lapu City issued TRO; hearing for preliminary injunction set.
- January 17, 1991: Motion to dismiss for improper venue denied; action deemed personal.
- January 30, 1991: RTC ordered issuance of preliminary injunction upon bond posting.
- Spouses Catungal answered with counterclaim, alleging Rodriguez’s breach (failure to secure road right of way, refusal to pay ₱5 million), bad faith, and invoked reciprocal right to rescind under Art. 1191, Civil Code; prayed for damages and cancellation of annotations.
- Pre-trial: multiple motions to dismiss denied; Catungals declared in default for refusal to participate; Rodriguez presented evidence.
- May 30, 1992: RTC Decision in Rodriguez’s favor—permanent injunction