Monday, October 1, 2012

tabancura digest



EXTINGUISHMENT OF SALE




MISTERIO v CEBU STATE COLLEGE OF SCIENCE AND TECHNOLOGY




FACTS:

Asuncion sold to Sudlon Agricultural High School(SAHS) a parcel of land, reserving the right to repurchase the same in case (1) the school ceases to exist, or (2) the school transfers location. She had her right annotated. She died. By virtue of BP 412, SAHS was merged with the Cebu State College, effective June1983. In 1990, the heirs of Asuncion sought to exercise their right to redeem, claiming that school has ceased to exist.

ISSUE:
W/N the heirs of Asuncion may still exercise their right to redeem the property

HELD:
 NO. Their right has already prescribed.Considering that no period for redemption was agreed upon, the law imposes a 4-year limitation. This means that from the time the school was merged to Cebu State College, they had 4 years, or until June 1987 to redeem the property. However, they failed to do so within the period. Failure to redeem automatically consolidates ownership in favor of the vendee. The fact that the right to redeem was annotated does not make it imprescriptible, it only serves to notify third persons.



    SORIANO v BAUTISTA


FACTS:
 Bautista spouses mortgaged their lot to Soriano,who took possession thereof and cultivated the same.Pursuant to Par. 5 of their agreement, Soriano decided to buy the lot. Bautista refused to sell claiming that being mortgagors, they cannot be deprived of their righto redeem the property.

ISSUE:
W/N Soriano may buy the mortgaged property of Bautista.

HELD:
 YES. True that the transaction is a mortgage,which carried with it a customary right of redemption.However, the mortgagor’s right to redeem was rendered defeasible at the election of the mortgagees by virtue ofPar. 5, allowing them the option to purchase the said lot. There is nothing immoral or illegal about such stipulation. It was supported by the same consideration as the mortgage contract and constituted an irrevocable continuing offer within the time stipulated. That being the case, Bautista spouses must be compelled to honor the sale.




ROBERTS v  PAPIO


FACTS:

 The Spouses Papio were the owners of a 274 sq m residential lot located in Makati. In order to secure a59k loan from the Amparo Investments Corp, they executed a real estate mortgage on the property. Upon Papio’s  failure to pay the loan, the corporation filed a petition for the extrajudicial foreclosure of the mortgage.* Since the couple needed money to redeem the property and to prevent the foreclosure of the real estate mortgage, they executed a Deed of Absolute Sale over the property in favor of Martin Papio’s cousin,Amelia Roberts.* Of the 95k purchase price, 59k was paid to the Amparo Investments Corp, while the 26k difference was retained by the spouses. As soon as the spouses had settled their obligation, the corporation returned the owner’s duplicate TCT which was then delivered to Amelia Roberts.
* The parties (A. Roberts as lessor and Martin Papio as lessee) executed a 2-year contract of lease. The contract was subject to renewal or extension for a like period at the option of the lessor, the lessee waiving thereby the benefits of an implied new lease. The lessee was obliged to pay monthly rentals of 800 to be deposited in the lessor’s account.
* A new TCT was issued in the name of Amelia Roberts as owner. Martin Papio paid the rentals and thereafter for another year. He then failed to pay rentals, but he and his family nevertheless remained in possession of the property for almost 13 years.* A. Roberts reminded Papio that he failed to pay monthly rentals amounting to a total liability of 410k.She demanded that Papio vacate the property within 15days from receipt of the letter in case he failed to settle the amount.* A. Roberts filed a complaint for unlawful detainer and damages against Martin Papio

ISSUE:
 W/N THE DEED OF ABSOLUTE SALE AND CONTRACT OF LEASE EXECUTED BY THE PARTIES IS AN EQUITABLE MORTGAGE OVER THE PROPERTY

RULING:
 NO. An equitable mortgage is one that, although lacking in some formality, form or words, or other requisites demanded by a statute, nevertheless reveals the intention of the parties to charge a real property as security for a debt and contain nothing impossible or contrary to law. A contract between the parties is an equitable mortgage if the following requisites are present: a. the parties entered into a contract denominated as a contract of sale and b. the intention was to secure an existing debt by way of mortgage. The decisive factor is the intention of the parties.In an equitable mortgage, the mortgagor retains ownership over the property but subject to foreclosure and sale at public auction upon failure of the mortgagor to pay his obligation.In contrast, in a pacto de retro sale, ownership of the property sold is immediately transferred to the vendee a retro subject only to the right of the vendor a retro to repurchase the property upon compliance with legal requirements for the repurchase. The failure of the vendor a retro to exercise the right to repurchase within the agreed time vests upon the vendee a retro, by operation of law, absolute title over the property.One repurchases only what one has previously sold.The right to repurchase presupposes a valid contract of sale between same parties. By insisting that he had repurchased the property, Papio thereby admitted that the deed of absolute sale executed by him and Roberts was in fact and in law a deed of absolute sale and not an equitable mortgage; he had acquired ownership over the property based on said deed.Respondent, is thus estopped from asserting that the contract under the deed of absolute sale is an equitable mortgage unless there is an allegation and evidence of palpable mistake on the part of respondent, or a fraud on the part of Roberts.




  ABILLA v GOBONSENG




FACTS:
 Spouses Abilla instituted against Spouses Gobonseng an action for specific performance, recovery of sum of money and damages, seeking the reimbursement of the expenses they incurred in the preparation and registration of 2 public instruments--Deed of Sale and Option to Buy. As a defense, Spouses Gobonseng contended that the transaction covered by these instruments was a mortgage. RTC ruled in favor of Spouses Abilla, stating that it was a sale giving Spouses Gobonseng until Aug. 31, 1983 within which to buy back the 17 lots subject of the sale. CA affirmed and held that the transaction was a pacto de retro sale, and not an equitable mortgage.In 1999, Spouses Gobonseng filed with the RTC an urgent motion to repurchase the lots with tender of payment, which was denied. However, after the judge inhibited himself from the case, it was re-raffled to a different branch, which granted the motion to repurchase.

ISSUE:
W/N Spouses Gobonseng may exercise the right to repurchase, as stipulated in Art. 1606 (3)

HELD:
NO. Sellers in a sale judicially-declared as pacto de retro may NOT exercise the right to repurchase within the 30-day period provided under Art. 1606,although they have taken the position that the same was an equitable mortgage, if it shown that there was no honest belief thereof since: (a) none of the circumstances under Art. 1602 were shown to exist to warrant a conclusion that the transaction was an equitable mortgage; and (b) that if they truly believed the sale to be an equitable mortgage, as a sign of good faith, they should have consigned with the trial court the amount representing their alleged loan, on or before the expiration of the right to repurchase.



NYCO SALES CORP v BA FINANCE



FACTS:
 NYCO Sales Corp extended a credit accommodation to the Fernandez Brothers. The brothers, acting in behalf of Sanshell Corp, discounted a BPI check for P60,000 with NYCO, which then indorsed the said check to BA Finance accompanied by a Deed of Assignment. BA Finance, in turn, released the funds,which were used by the brothers. The BPI check was dishonored. The brothers issued a substitute check,which was also dishonored. Now BA Finance goes after NYCO, which disclaims liability.

ISSUE:
 W/N NYCO, as the assignor, is liable for breach of warranties.

HELD:
YES. The assignor (NYCO) warrants both the existence and legality of the credit, as well as the solvency of the debtor. If there is a breach of any of the2 warranties, the assignor is liable to the assignee. That being the case, NYCO cannot evade liability. So long as the credit remains unpaid, the assignor remains liable notwithstanding failure to give notice of dishonor that is because the liability of NYCO stems form the assignment, not on the checks alone.

     LICAROS v GATMAITAN


FACTS:
Abelardo Licaros invested his money worth$150,000 with Anglo-Asean Bank, a money market placement by way of deposit, based in the Republic of Venatu. Unexpectedly, he had a hard time getting back his investments as well as the interest earned. He then sought the counsel of Antonio Gatmaitan, a reputable banker and investor. They entered into an agreement,where a non-negotiable promissory note was to be executed in favor of Licaros worth $150,000, and that Gatmaitan would take over the value of the investment made by Licaros with the Anglo-Asean Bank at the former's expense. When Gatmaitan contacted the foreign bank, it said they will look into it, but it didn't prosper. Because of the inability to collect,Gatmaitan did not bother to pay Licaros the value of the promissory note. Licaros, however, believing that he had a right to collect from Gatmaitan regardless of the outcome, demanded payment, but was ignore. Licaros filed a complaint against Gatmaitan for the collection of the note. The trial court ruled in favor of Licaros, but CA reversed.

ISSUE:
Whether the memorandum of agreement between petitioner and respondent is one of assignment of credit or one of conventional subrogation

RULING:
 It is a conventional subrogation. An assignment of credit has been defined as the process of transferring the right of the assignor to the assignee who would then have a right to proceed against the debtor. Consent of the debtor is not required is not necessary to product its legal effects, since notice of the assignment would be enough. On the other hand, subrogation of credit has been defined as the transfer of all the rights of the creditor to a third person, who substitutes him in all his rights. It requires that all the related parties thereto,the original creditor, the new creditor and the debtor,enter into a new agreement, requiring the consent of the debtor of such transfer of rights. In the case at hand, it was clearly stipulated by the parties in the memorandum of agreement that the express conformity of the third party (debtor) is needed. The memorandum contains a space for the signature of the Anglo-Asean Bank written therein "with our conforme". Without such signature, there was no transfer of rights. The usage of the word "Assignment" was used as a general term, since Gatmaitan was not a lawyer, and therefore was not well-versed with the language of the law.


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