Karen Nuñez Vito v. Norma Moises-Palma, G.R. No. 224466, March 27, 2019

FACTS:

Petitioners' father, Vicentico Nufiez, was the original owner of Lot No. 2159-A located in Capiz with TCT No. T-16612.

In May 1992, Vicentico borrowed P30,000 from Rosita Moises and as security, executed a real estate mortgage over his property. Since Rosita had no money, the funds came from Norma Moises-Palma, Rosita's daughter. According to petitioners, the loan was subsequently paid as evidenced by an Affidavit Authorizing Release of Mortgage.

Upon Vicentico's and Placida's deaths, the subject lot was transmitted to their heirs.

On June 28, 1995, Norma was able to have all petitioners, except Alden, sign a  Deed of Adjudication and Sale wherein petitioners purportedly sold to Norma their in the subject lot for P50,000. After the execution of the DAS, Norma immediately took possession of the subject lot. Instead of paying cash, Norma executed a Promissory Note on July 1, 1995. Upon prodding of petitioners, Norma executed an Acknowledgment of Debt.

Despite non-payment of the purchase price and the absence of Alden's signature on the DAS, Norma was able to cause the registration of the document with the Register of Deeds of Capiz and TCT T-3546022 was issued to her on August 2, 2005.

On February 19, 2010, Karen, Warren and Lynette, through Alden, and Alden, in his own capacity, filed an amended complaint before the MTC for Declaration of Nullity of Deed of Adjudication and Sale, Cancellation of TCT No. T-35460, Recovery of Ownership and/or Possession of Lot No. 2159-A and Damages.

The MTC rendered on June 8, 2012 a Decision in favor of petitioners.

The R TC in its Decision34 dated December 11, 2012 granted respondent's appeal.

The CA in its Decision dated July 31, 2015 affirmed the RTC Decision.

 

ISSUE:

Whether the contact of sale of the subject immovable property may be rescinded

 

RULING:

The remedies of the unpaid seller, after ownership of the real property not covered by Republic Act No. 6552 or the Maceda Law, has been vested to the buyer, are:

1. To compel specific performance by filing an action against the buyer for the agreed purchase price; or

2.  To rescind or resolve the contract of sale either judicially or t|y a notarial act; and

3. In either (1) or (2), to recover damages for the breach of the contract.

The non-payment of the purchase price in a contract of sale is a negative resolutory condition, the happening or fulfillment thereof will extinguish the obligation or the sale pursuant to Article 1231 of the Civil Code, which provides that fulfillment of a resolutory condition is another cause of extinguishment of obligations. Despite its extinguishment, since the vendor has lost ownership of the land, the contract must itself be resolved and set aside. It is noted, however, that the resolution of the sale is the tacit resolutory condition under Article 1191, as discussed above, which is implied in reciprocal obligations.

Consequently, the Court rules that the sale transaction in the DAS is deemed resolved.

 

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