Case Summary (G.R. No. 150308)
Antecedents
The Spouses Flores agreed to sell two parcels of land to Tatic Square International Corporation (TATIC) through an Agreement to Sell executed on October 10, 1987, which was financed by a loan from Capital Rural Bank of Makati, Inc. A Memorandum of Agreement was established on April 13, 1988, detailing the obligations of the Spouses Flores, TATIC, the broker Isidro S. Tobias, and the Bank concerning taxes, clearing of titles, and removal of occupants from the property.
Transactions and Agreements
On April 14, 1988, TATIC executed a deed of absolute sale, selling the properties to VELI for P6,295,224.88. This agreement included an addendum regarding the clearing of titles from encumbrances and obligations and the eviction of any occupants. Subsequently, on November 11, 1988, VELI sold one of the parcels to Genuino Ice Co., Inc. for P4,000,000.00.
Dispute Initiation
Genuino Ice Co. subsequently sent demands for the payment of capital gains tax and the removal of occupants to VELI. After a letter of rejection from VELI, Genuino Ice Co. filed a Complaint for specific performance and damages before the Regional Trial Court, asserting that VELI had failed to fulfill obligations related to the sale.
Court Proceedings and Rulings
The trial court ruled in favor of Genuino Ice Co., ordering VELI to transfer the title, pay the capital gains tax, and cause the eviction of squatters from the property. The ruling emphasized the petitioners' liability even though Genuino Ice Co. was not a party to the initial deeds of sale, as the obligations stemming from those transactions were still enforceable.
Court of Appeals Decision
The Court of Appeals affirmed this ruling, with modifications, holding VELI liable for registration expenses and confirming their responsibility to clear the property of squatters. The appellate court recognized that Genuino Ice Co. was not privy to prior agreements but could still seek enforcement of obligations stipulated in subsequent transactions.
Legal Issues for Resolution
The key issues presented to the Supreme Court included: (a) whether VELI was obligated to pay costs for title transfer and eviction of occupants, (b) liability for capital gains tax in connection with the sale to Genuino Ice Co., and (c) obligation to remove squatters from the property.
Obligation for Registration and Eviction
The Supreme Court upheld the CA's findings that under Article 1487 of the New Civil Code, VELI, as vendor, remains responsible for registration expenses unless the parties have expressly agreed otherwise. Since there was no such stipulation relived VELI from these obligations, the court affirmed the need for VELI to effectuate the registration of the deed and ensure the prope
...continue readingCase Syllabus (G.R. No. 150308)
Case Overview
- Parties Involved: Vive Eagle Land, Inc. (VELI) and Virgilio O. Cervantes as petitioners; Court of Appeals and Genuino Ice Co., Inc. as respondents.
- Court: Supreme Court of the Philippines.
- Date of Decision: November 26, 2004.
- Case Reference: G.R. No. 150308.
- Nature of the Petition: Review of the Court of Appeals' decision regarding obligations arising from a series of sales involving real property.
Antecedents of the Case
- The Spouses Raul and Rosalie Flores owned two parcels of land along Aurora Boulevard, Quezon City, covered by Transfer Certificates of Title (TCT) Nos. 241845 and 241846.
- On October 10, 1987, the Spouses Flores agreed to sell the properties to Tatic Square International Corporation (TATIC).
- The Bank provided TATIC with a loan of P5,757,827.63, contingent on the registration of the titles under TATIC's name.
- A Memorandum of Agreement (MOA) was executed on April 13, 1988, detailing the obligations of the parties, including warranties on the titles and responsibilities for taxes and tenant removals.
Key Agreements and Sales
- The Spouses Flores executed a deed of absolute sale to TATIC on April 13, 1988.
- Subsequently, TATIC sold the properties to VELI on April 14, 1988, for P6,295,224.88, with warranties regarding the titles and possession.
- On November 11, 1988, VELI executed a deed of absolute sale to Genuino Ice Co., Inc. for the property covered by TCT No. 241846 for P4,000,000.00, along with a deed of assignment of rights.