Case Summary (G.R. No. 128579)
Relevant Background and Legal Provisions
Candido Rubi entered into a lease agreement with the Province of Cebu for Lot 1141, during which he made significant improvements on the property. In 1964, the Province donated this lot to the City of Cebu, and Ordinance No. 522 was enacted in 1965 to allow for its public auction. The ordinance provided that any lessee would have the right to match the highest bid to acquire the property. After a series of events including a civil suit that initially paused the sale, in 1976, Rubi successfully registered as a bidder and expressed his willingness to pay the offered bid price, following which he received communication from the City approving the arrangement.
Initial Court Decisions
The trial court dismissed the heirs' complaint for specific performance as it concluded that a perfected contract of sale was never established due to Rubi's failure to meet payment conditions. In contrast, the Court of Appeals found that there indeed existed a perfected contract and ruled in favor of the heirs, stating Circumstances beyond Rubi’s control prevented the completion of payment, therefore he was entitled to the property.
Points Raised by the Petitioner
In seeking to overturn the Court of Appeals' decision, the City of Cebu argued several points:
- The view that a perfected contract of sale was never established.
- Rubi's failure to comply with payment conditions constituted unreasonable delay and laches.
- The absence of a formal written contract rendered the agreement unenforceable under the statute of frauds.
- Even if there was a perfected contract, the heirs were required to compensate for the period of delayed payment.
Findings on the Nature of the Agreement
The Supreme Court agreed with the Court of Appeals and found that the transaction between Rubi and the City constituted a perfected contract of sale. All elements – mutual consent, a definite subject matter, and a determined price – were observed. The agreement was substantively supported by documented exchanges which qualified as satisfying the elements of validity required under the Civil Code.
Demand for Payment and Rescission
The discussions also revolved around whether non-payment within the stipulated fifteen days would be fatal to Rubi's right to enforce the sale. Article 1592 of the Civil Code permits the vendee to pay even after the expiration of the payment period if no formal demand for rescission has been made. The Court pointed out that the City of Cebu had not made any valid demand for rescission until 1989 when the heirs filed for specific performance.
Ruling on Delay and Laches
With respect to the claims of laches against the heirs, the Court emphasized that both parties displayed neglect. Rubi had consistently sought an extension of time for payment, which was never formally responded to by the City. Thus, it acknowledged that he had not forsaken his rights.
...continue readingCase Syllabus (G.R. No. 128579)
Case Background
- The case revolves around a petition for review on Certiorari filed by the City of Cebu against the heirs of Candido Rubi.
- Candido Rubi was a lessee of a parcel of land identified as Lot 1141 of the Banilad Estate, with an area of 33,188 square meters, covered by Transfer Certificate of Title No. RT-5513.
- The lease agreement specified that the premises were to be used exclusively for residential and agricultural purposes.
- Improvements were made on the property, including a residential building constructed in 1961, where Rubi resided until his death in 1983.
Donation and Ordinance
- In 1964, the Province of Cebu donated 210 lots, including Lot 1141, to the City of Cebu.
- Ordinance No. 522, enacted on March 4, 1965, allowed the City Mayor to sell these lots at public auction, stipulating that if a lot is leased, the lessee has the right to equal the highest bid during the public bidding.
Bidding and Legal Proceedings
- On August 5, 1965, Candido Rubi was notified of the highest bid for Lot 1141 by Miguel Kho but expressed intent to equal the bid.
- A writ of preliminary injunction was issued on August 6, 1965, preventing the City from selling the donated lots, including Lot 1141.
- A compromise agreement in 1974 adjudicated Lot 1141 to the City of Cebu while it had already been subdivided into Lots 1141-A, 1141-B, 1141-C, and 1141-D, with Lot 1141-D being the subject of this case.
Attempted Purchase and Correspondence
- In a public bidding held on January 30, 1976, Rubi paid a cash bond for Lot 1141-D and later expressed his intent to equal the highest bid price.
- The City Council authorized the sale, and the City Mayor instructed Rubi to make payment for the lot.
- Various correspondences betwee