Case Summary (G.R. No. 208185)
Payment History and Default
From June 17, 2001 to July 14, 2004 Orbe remitted P608,648.20. Financial difficulties thereafter prevented further payments. Respondent sent a purportedly notarial cancellation notice on October 4, 2004, effective thirty days after receipt, citing nonpayment despite a 60-day grace period.
HLURB and Court of Appeals Proceedings
HLURB Field Office and Board awarded Orbe Section 3 benefits (50% refund) upon finding more than two years of installments paid. Office of the President affirmed. The Court of Appeals reversed, holding Orbe paid only the equivalent of 21.786 months’ amortizations, not 24, thus Section 4 applied; respondent validly cancelled by notarial act.
Supreme Court Interpretation of RA 6552 Sections 3 and 4
Section 3 requires payment equivalent to two years of installments—i.e., 24 monthly amortizations computed at the first‐year rate including down payments—for full cancellation benefits. Orbe’s total remittance equated to 21.786 months; she did not qualify. Section 4 grants a 60-day grace period and permits cancellation by notarial act 30 days after notice if installments remain unpaid.
Validity Requirements for Notarial Cancellation
Under the Maceda Law and the 2004 Notarial Rules, cancellation notices must be made by notarial acknowledgment—not merely a jurat—and, for juridical sellers, signed by an authorized representative whose capacity is demonstrated by board resolution or corporate documents. Filinvest’s notice bore only a jurat and identification by community tax certificate (invalid evidence of identity), failing to satisfy Section 4’s notarial requirements. The cancellation was therefore ineffective.
Equitable Relief Given Subsequent Sale
With the contract deemed valid and subsisting but the lot already sold to Ymana, the Court applied equitable principles from prior jurisprudence. Unl
...continue readingCase Syllabus (G.R. No. 208185)
Procedural History
- Petition for Review on Certiorari filed under Rule 45 of the 1997 Rules of Civil Procedure, assailing the Court of Appeals’ October 11, 2012 Decision and July 3, 2013 Resolution in CA-G.R. SP No. 118285.
- The Court of Appeals reversed the HLURB Field Office Arbiter and HLURB Board of Commissioners, holding that petitioner Orbe was entitled to benefits under Section 3 of Republic Act No. 6552.
- The same court denied Orbe’s Motion for Reconsideration.
- This Supreme Court review raises the question whether Orbe may avail herself of Section 3 benefits or is limited to Section 4 of the Maceda Law.
Facts of the Case
- In June 2001, Priscilla Zafra Orbe entered into a Purchase Agreement with Filinvest Land, Inc. for a 385-sqm lot in Highlands Pointe, Taytay, Rizal.
- Total contract price: ₱2,566,795.00, comprising:
- Reservation Fee: ₱20,000.00
- Down Payments: ₱493,357.00
- Monthly installments of ₱54,818.00 from August 4, 2001 to April 4, 2002
- Balance of ₱2,053,436.00 payable over seven years (May 8, 2002–April 8, 2009) with escalating monthly amortizations (first-year ₱27,936.84; second ₱39,758.84; third ₱41,394.84; fourth–seventh ₱42,138.84).
- From June 17, 2001 to July 14, 2004, Orbe paid ₱608,648.20 via ten Metrobank checks, duly receipted by Filinvest.
- Orbe stopped payments allegedly due to financial difficulties.
- Filinvest sent a Notice of Cancellation dated October 4, 2004, received October 18, 2004, accompanied by a jurat before Notary Public Avelio L. Salcedo on October 6, 2004.
- Orbe’s requests for reconsideration by Filinvest proved futile; the property was resold to a third party, Ruel Ymana, allegedly in bad faith.
- On November 13, 2007, Orbe filed a Complaint for refund with damages before the HLURB Field Office.
Legal Issue
- Whether petitioner Priscilla Zafra Orbe is entitled to the benefits of Section 3 of Republic Act No. 6552 (the Maceda Law), or if she is governed by Section 4 due to insuff