Case Summary (G.R. No. L-18377)
Background of Transaction
On September 10, 1959, the petitioner, Anastacio G. Dungo, and Rodrigo S. Gonzales purchased three parcels of land from respondents Adriano Lopena and Rosa Ramos for a total of P269,804.00. A down payment of P28,000.00 was made, with the balance of P241,804.00 to be paid in six monthly installments. To secure this payment, a Deed of Real Estate Mortgage was executed by the petitioner and Gonzales in favor of Lopena and Ramos, which was registered with the Office of the Register of Deeds of Rizal. The mortgage stipulated that any default in payments would make the entire unpaid balance due.
Foreclosure Proceedings Initiated
After the vendees defaulted on their first installment, respondents filed a complaint for foreclosure on November 7, 1959. The complaint was countered by Dungo and Gonzales on December 7, 1959. Concurrently, two additional civil cases involving similar claims by Dionisio Lopena and Bernardo Lopena were consolidated with this complaint.
Compromise Agreement Submission
A compromise agreement was prepared on January 15, 1960, signed by Rodolfo S. Gonzales (as a representative of Dungo) and approved by the court, but not signed by Dungo himself. Dungo’s counsel, who signed the compromise, acknowledged his role in the agreement. The agreement included provisions on payment deadlines and waivers.
Tri-Party Agreement Execution
On May 3, 1960, a Tri-Party Agreement was signed involving Dungo, Gonzales, and a third-party payor, Emma R. Santos, who would assume the mortgage obligations. This agreement established a new payment schedule but still referenced the earlier compromise agreement.
Default and Court Actions
After failing to meet the obligations on June 30, 1960, respondents filed a motion for the sale of the mortgaged properties on July 5, 1960. Dungo and Gonzales were notified but did not oppose the motion. Consequently, the court ordered the public auction on July 19, 1960, which resulted in the properties being auctioned on August 25, 1960. The sale was confirmed by the court on August 30, 1960.
Motion to Set Aside Foreclosure Proceedings
Dungo subsequently filed a motion on August 31, 1960, to set aside the foreclosure proceedings, claiming the compromise agreement was void as he did not sign it. This motion was denied by the lower court on December 14, 1960.
Appeal and Legal Issues Raised
Dungo filed a Notice of Appeal against the order of foreclosure and the denial of his motion to set aside. Respondents opposed his appeal, claiming it was not appealable due to the nature of the compromise agreement, which they argued rendered the judgment final. The lower court ultimately dismissed Dungo’s appeal.
Court's Analysis of the Compromise Agreement
The court addressed two key issues: whether the compromise agreement was void concerning Dungo and whether the lower court abused its discretion by dismissing his appeal. Dungo asserted the compromise was invalid due to his non-signature; however, the court found that a compromise is a contract governed by the Civil Code and specified that absence of a signature does not nullify the agreement outright if the party has ratified it.
Ratification Through Tri-Party Agreement
The court determined that Dungo ratified the compromise agreement thro
...continue readingCase Syllabus (G.R. No. L-18377)
Case Background
- On September 10, 1959, Anastacio G. Dungo and Rodrigo S. Gonzales purchased three parcels of land from Adriano Lopena and Rosa Ramos for a total price of P269,804.00.
- A down payment of P28,000.00 was made, with an agreement to pay the remaining balance of P241,804.00 in six monthly installments.
- To secure the payment of the balance, a Deed of Real Estate Mortgage was executed on September 11, 1958, by the vendees over the same three parcels of land in favor of Lopena and Ramos.
- The deed included a clause stating that failure to pay any installment on its due date would render the entire unpaid balance due and demandable.
Default and Foreclosure Proceedings
- The vendees defaulted on the first installment, prompting Lopena and Ramos to file a complaint on November 7, 1959, for foreclosure with the Court of First Instance of Rizal.
- The case was presided over by Judge Andres Reyes.
- Dungo and Gonzales answered the complaint on December 7, 1959.
- Concurrently, two additional civil cases were filed against Dungo and Gonzales, leading to the consolidation of all three cases due to their identical nature.
Compromise Agreement and Its Approval
- A compromise agreement was submitted to the lower court on January 15, 1960, signed by Lopena and Ramos, and purportedly by Gonzales.
- Dungo did not sign this agreement; however, his counsel, Atty. Manuel O. Chan, was present during its preparation and signed it.
- The compromise agreement allowed the defendants until June 30, 1960, to pay off the mortgage indebtedness, failing which foreclosure judgments would be entered.