JOVAN LAND VS. COURT OF APPEALS AND EUGENIO QUESADA, INC.

Facts: Petitioner Jovan Land, Inc. is a corporation engaged in the real estate business. Its President and Chairman
of the Board of Directors is one Joseph Sy. Private respondent Eugenio Quesada is the owner of the Q Building
located at the corner of Mayhaligue Street and Rizal Avenue, Sta. Cruz, Manila. Petitioner learned that that
private respondent was selling the aforesaid property. Thus, petitioner through Joseph Sy made a written offer
for P10.25 million.

This first offer was not accepted by Conrado Quesada, the General Manager of private
respondent. Joseph Sy sent a second written offer for the same price but inclusive of an undertaking to pay the
documentary stamp tax, transfer tax, registration fees and notarial charges. Check for one million pesos
drawn against the Philippine Commercial and Industrial Bank (PCIB) was enclosed therewith as earnest money.
This second offer, with earnest money, was again rejected by Conrado Quesada. Undaunted, Joseph Sy, sent a
third written offer for twelve million pesos with a similar check for one million pesos as earnest money.
Annotated on this third letter-offer was the phrase "Received original, 9-4-89" beside which appears the
signature of Conrado Quesada. On the basis of this annotation which petitioner insists is the proof that there
already exists a valid, perfected agreement to sell the Mayhaligue property, petitioner filed with the trial court, a
complaint for specific performance and collection of sum of money with damages. Petitioner contends that the
said annotation is evidence to show that there was already a perfected agreement to sell as respondent can be
said to have accepted petitioner's payment in the form of a check which was enclosed in the third letter.

Issue: Whether or not there was already a perfected contract of sale between Jovan Land, Inc. and the private
respondent?

Held: No.

"xxx [A] contract (Art. 1157, Civil Code), x x x is a meeting of minds between two persons whereby one binds
himself, with respect to the other, to give something or to render some service xxx. A contract undergoes various
stages that include its negotiation or preparation, its perfection and, finally, its consummation. Negotiation
covers the period from the time the prospective contracting parties indicate interest in the contract to the time
the contract is concluded xxx. The perfection of the contract takes place upon the concurrence of the essential
elements thereof."

Moreover, it is a fundamental principle that before contract of sale can be valid, the following elements must be
present, viz: (a) consent or meeting of the minds; (b) determinate subject matter; (3) price certain in money or
its equivalent. Until the contract of sale is perfected, it cannot, as an independent source of obligation, serve as a
binding juridical relation between the parties.

A punctilious examination of the receipt reveals that the same can neither be regarded as a contract of sale nor a
promise to sell. Such an annotation by Conrado Quesada amounts to neither a written nor an implied acceptance
of the offer of Joseph Sy. It is merely a memorandum of the receipt by the former of the latter's offer. The
requisites of a valid contract of sale are lacking in said receipt and therefore the "sale" is neither valid nor
enforceable. Although there was a series of communications through letter-offers and rejections as evident from
the facts of this case, still it is undeniable that no written agreement was reached between petitioner and private
respondent with regard to the sale of the realty. Hence, the alleged transaction is unenforceable as the
requirements under the Statute of Frauds have not been complied with.

Under the said provision, an agreement for the sale of real property or of an interest therein, to be enforceable,
must be in writing and subscribed by the party charged or by an agent thereof.

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SAN MIGUEL PROPERTIES PHILS., INC. v SPOUSES ALFREDO and GRACE HUANG, G. R. No. 137290, 31 July 2000
Nature of the Case: A petition for review for a decision of the Court of Appeals which reversed the decision of the RTC
dismissing the complaint brought by the Huangs against San Miguel Properties for enforcement of a contract of sale.

Facts: San Miguel Properties offered two parcels of land for sale and the offer was made to an agent of the respondents. An
earnest-deposit of P1 million was offered by the respondents and was accepted by the petitioners authorized officer
subject to certain terms.

Petitioner, through its executive officer, wrote the respondents lawyer that because ethe parties failed to agree on the
terms and conditions of the sale despite the extension granted by the petitioner, the latter was returning the earnest-
deposit.

The respondents demanded execution of a deed of sale covering the properties and attempted to return the earnest-
deposit but petitioner refused on the ground that the option to purchase had already expired.

A complaint for specific performance was filed against the petitioner and the latter filed a motion to dismiss the complaint
because the alleged exclusive option of the respondents lacked a consideration separate and distinct from the purchase
price and was thus unenforceable; the complaint did not allege a cause of action because there was no meeting of the
mind between the parties and therefore the contact of sale was not perfected.

The trial court granted the petitioners motion and dismissed the action. The respondents filed a motion for reconsideration
but were denied by the trial court. The respondents elevated the matter to the Court of Appeals and the latter reversed the
decision of the trial court and held that a valid contract of sale had been complied with.

Issue: WON there was a perfected contract of sale between the parties

Ruling: The decision of the appellate court was reversed and the respondents complaint was dismissed.

Ratio Decidendi: It is not the giving of earnest money , but the proof of the concurrence of all the essential elements of
the contract of sale which establishes the existence of a perfected sale.

The P1 million earnest-deposit could not have been given as earnest money because at the time when petitioner accepted
the terms of respondents offer, their contract had not yet been perfected. This is evident from the following conditions
attached by respondents to their letter.
The first condition for an option period of 30 days sufficiently shows that a sale was never perfected. As petitioner correctly
points out, acceptance of this condition did not give rise to a perfected sale but merely to an option or an accepted
unilateral promise on the part of respondents to buy the subject properties within 30 days from the date of acceptance of
the offer. Such option giving respondents the exclusive right to buy the properties within the period agreed upon is separate
and distinct from the contract of sale which the parties may enter. All that respondents had was just the option to buy the
properties which privilege was not, however, exercised by them because there was a failure to agree on the terms of
payment. No contract of sale may thus be enforced by respondents.
Even the option secured by respondents from petitioner was fatally defective. Under the second paragraph of Art. 1479, an
accepted unilateral promise to buy or sell a determinate thing for a price certain is binding upon the promisor only if the
promise is supported by a distinct consideration. Consideration in an option contract may be anything of value, unlike in sale
where it must be the price certain in money or its equivalent. There is no showing here of any consideration for the option.
Lacking any proof of such consideration, the option is unenforceable.
Equally compelling as proof of the absence of a perfected sale is the second condition that, during the option period, the
parties would negotiate the terms and conditions of the purchase. The stages of a contract of sale are as follows:
(1) negotiation, covering the period from the time the prospective contracting parties indicate interest in the contract to the
time the contract is perfected; (2) perfection, which takes place upon the concurrence of the essential elements of the sale
which are the meeting of the minds of the parties as to the object of the contract and upon the price; and
(3) consummation, which begins when the parties perform their respective undertakings under the contract of sale,
culminating in the extinguishment thereof.
.

In the present case, the parties never got past the negotiation stage. The alleged indubitable evidence of a perfected sale
cited by the appellate court was nothing more than offers and counter-offers which did not amount to any final
arrangement containing the essential elements of a contract of sale. While the parties already agreed on the real properties
which were the objects of the sale and on the purchase price, the fact remains that they failed to arrive at mutually
acceptable terms of payment, despite the 45-day extension given by petitioner.

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Fule v. CA
Facts:

Gregorio Fule, a banker and a jeweller, offered to sell his parcel of land to Dr. Cruz in exchange for P40,000 and a
diamond earring owned by the latter. A deed of absolute sale was prepared by Atty. Belarmino, and on the same
day Fule went to the bank with Dichoso and Mendoza, and Dr. Cruz arrived shortly thereafter. Dr. Cruz got the
earrings from her safety deposit box and handed it to Fule who, when asked if those were alright, nodded and
took the earrings. Two hours after, Fule complained that the earrings were fake. He files a complaint to declare
the sale null and void on the ground of fraud and deceit.

Issue:

Whether the sale should be nullified on the ground of fraud

Held:

A contract of sale is perfected at the moment there is a meeting of the minds upon the thing which is the object
of the contract and upon the price. Being consensual, a contract of sale has the force of law between the
contracting parties and they are expected to abide in good faith by their respective contractual commitments. It
is evident from the facts of the case that there was a meeting of the minds between petitioner and Dr. Cruz. As
such, they are bound by the contract unless there are reasons or circumstances that warrant its nullification.

Contracts that are voidable or annullable, even though there may have been no damage to the contracting
parties are: (1) those where one of the parties is incapable of giving consent to a contract; and (2) those where
the consent is vitiated by mistake, violence, intimidation, undue influence or fraud. The records, however, are
bare of any evidence manifesting that private respondents employed such insidious words or machinations to
entice petitioner into entering the contract of barter. It was in fact petitioner who resorted to machinations to
convince Dr. Cruz to exchange her jewelry for the Tanay property.

Furthermore, petitioner was afforded the reasonable opportunity required in Article 1584 of the Civil Code
within which to examine the jewelry as he in fact accepted them when asked by Dr. Cruz if he was satisfied with
the same. By taking the jewelry outside the bank, petitioner executed an act which was more consistent with his
exercise of ownership over it. This gains credence when it is borne in mind that he himself had earlier delivered
the Tanay property to Dr. Cruz by affixing his signature to the contract of sale. That after two hours he later
claimed that the jewelry was not the one he intended in exchange for his Tanay property, could not sever the
juridical tie that now bound him and Dr. Cruz. The nature and value of the thing he had taken preclude its return
after that supervening period within which anything could have happened, not excluding the alteration of the
jewelry or its being switched with an inferior kind.

Ownership over the parcel of land and the pair of emerald-cut diamond earrings had been transferred to Dr. Cruz
and petitioner, respectively, upon the actual and constructive delivery thereof. Said contract of sale being
absolute in nature, title passed to the vendee upon delivery of the thing sold since there was no stipulation in
the contract that title to the property sold has been reserved in the seller until full payment of the price or that
the vendor has the right to unilaterally resolve the contract the moment the buyer fails to pay within a fixed
period.

While it is true that the amount of P40,000.00 forming part of the consideration was still payable to petitioner,
its nonpayment by Dr. Cruz is not a sufficient cause to invalidate the contract or bar the transfer of ownership
and possession of the things exchanged considering the fact that their contract is silent as to when it becomes
due and demandable.

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Dizon vs CA

FACTS:

1. Respondent Overland Express Lines, Inc. entered into a contract of lease with an optionto buy with the
petitioners involving 1,755.80square meter parcel of land situated in Diliman, Quezon City. The term of the lease
was for 1year. Respondent was granted an option to purchase for the amount of 3,000 per square meter.

2. respondent failed to pay the increased rent a land petitioners filed an action for ejectment.

3. MTC ordered respondent to vacate the leased premises and pay representing rentals and or damages for
reasonable compensation for the use and occupation of the premises during the illegal detainer.

4. Respondent filed for a petition praying forthe issuance of a restraining order enjoining the enforcement of the
judgment and lack of its jurisdiction.

5. RTC rendered to dismissed the case while CA uphold the jurisdiction in the ejectment case. It was also
concluded that there was a perfected contract of sale between the parties on the leased premises and the
pursuant to the option to buy agreement. respondent acquired the rights of a vendee in contract of sale.

Issue:

Whether or not there is a perfected contract ofsale between the parties.

Held:

The contract of sale is perfected at the moment there is a meeting of minds upon the thing which is the object of
the contract and upon the price. From that moment, parties reciprocally demand performance. Thus, the
elements of a contract are consent, object, and price in money or its equivalent. It bears stressing that the
absence of any these elements negates the existence of a perfected contract of sale. Sale is a consensual
contract who alleges it must show its existence by competent proof. Respondent gave 300,000 to petitioners on
the erroneous presumption that he said amount perfected a contract of sale pursuant to the contract of lease
with option to buy. There was no valid consent by the petitioners on the supposed sale entered by Dizon, as
petitioners agent. As provided in New civil code, there was no showing that petitioners consented to the act of
Dizon nor authorized her to act on their behalf. respondent should have done was ascertain the extent of
authority of Dizon. Respondent cannot seek relief on the supposed agency. Wherefore, petitioners are ordered
to refund to respondent the amount of 300,000 which they received through Dizon.

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GOMEZ VS CA

168 SCRA 503 Civil Law Land Titles and Deeds Judgment Confirms Title Sec 30 & 32 PD
1529
A court ruling (Philippine Islands vs Abran) settled that 12 parcels of land belonged to one
Consolacion Gomez. Consolacion later died and the 12 parcels of land were inherited by Jose
Gomez et al her heirs. The heirs agreed to divide the property among them.
After notice and publication, and there being no opposition to the application, the trial court issued
an order of general default. On August 5, 1981, the court rendered its decision adjudicating the
subject lots in Gomez et als favor. The decision became final and executory hence the court
directed the Chief of the General Land Registration Office (GLRO) to issue the corresponding
decrees of registration over the lots adjudicated.
GLRO Chief Silverio Perez opposed the adjudication and petitioned for its setting aside. He
discovered that the 12 parcels of land were formerly part of a titled land which was already granted
by homestead patent in 1929. Under the law, land already granted by homestead patent can no
longer be the subject of another registration. The lower court granted Silverios recommendation.
Gomez et al invoked Sec. 30 and 32 of PD 1529 (Land Registration Act) which provides that after
judgment has become final and executory, the court shall forthwith issue an order to the
Commissioner of Land Registration for the issuance of the decree of registration and certificate of
title. That once the judgment becomes final and executory under Sec 30, the decree of registration
must issue as a matter of course.
ISSUE: Whether or not to set aside the lower courts initial ruling on approving the adjudication
even after it had became final and executory.
HELD: Yes. Unlike ordinary civil actions, the adjudication of land in a cadastral or land registration
proceeding does not become final, in the sense of incontrovertibility until after the expiration of one
(1) year after the entry of the final decree of registration. The Supreme Court has held that as long
as a final decree has not been entered by the Land Registration Commission (now NLTDRA) and
the period of one (1) year has not elapsed from date of entry of such decree, the title is not finally
adjudicated and the decision in the registration proceeding continues to be under the control and
sound discretion of the court rendering it.

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Coronel v. CA

Facts:

The case arose from a complaint for specific performance filed by private respondent Alcaraz against petitioners
to consummate the sale of a parcel of land in Quezon City.

On January 19, 1985, petitioners executed a Receipt of Down Payment of P50,000 in favor of plaintiff Ramona
Alcaraz, binding themselves to transfer the ownership of the land in their name from their deceased father,
afterwhich the balance of P1,190,000 shall be paid in full by Alcaraz. On February 6, 1985, the property was
transferred to petitioners. On February 18, 1985, petitioners sold the property to Mabanag. For this reason,
Concepcion, Ramonas mother, filed an action for specific performance.

Issue:

Whether the contract between petitioners and private respondent was that of a conditional sale or a mere
contract to sell

Held:

Sale, by its very nature, is a consensual contract because it is perfected by mere consent. The essential elements
of a contract of sale are the following: a) Consent or meeting of the minds, that is, consent to transfer ownership
in exchange for the price; b) Determinate subject matter; and c) Price certain in money or its equivalent.

Under this definition, a Contract to Sell may not be considered as a Contract of Sale because the first essential
element is lacking. In a contract to sell, the prospective seller explicity reserves the transfer of title to the
prospective buyer, meaning, the prospective seller does not as yet agree or consent to transfer ownership of the
property subject of the contract to sell until the happening of an event, which for present purposes we shall take
as the full payment of the purchase price. What the seller agrees or obliges himself to do is to fulfill his promise
to sell the subject property when the entire amount of the purchase price is delivered to him. In other words the
full payment of the purchase price partakes of a suspensive condition, the non-fulfillment of which prevents the
obligation to sell from arising and thus, ownership is retained by the prospective seller without further remedies
by the prospective buyer. A contract to sell may thus be defined as a bilateral contract whereby the prospective
seller, while expressly reserving the ownership of the subject property despite delivery thereof to the
prospective buyer, binds himself to sell the said property exclusively to the prospective buyer upon fulfillment of
the condition agreed upon, that is, full payment of the purchase price.

A contract to sell may not even be considered as a conditional contract of sale where the seller may likewise
reserve title to the property subject of the sale until the fulfillment of a suspensive condition, because in a
conditional contract of sale, the first element of consent is present, although it is conditioned upon the
happening of a contingent event which may or may not occur. If the suspensive condition is not fulfilled, the
perfection of the contract of sale is completely abated. However, if the suspensive condition is fulfilled, the
contract of sale is thereby perfected, such that if there had already been previous delivery of the property
subject of the sale to the buyer, ownership thereto automatically transfers to the buyer by operation of law
without any further act having to be performed by the seller. In a contract to sell, upon the fulfillment of the
suspensive condition which is the full payment of the purchase price, ownership will not automatically transfer
to the buyer although the property may have been previously delivered to him. The prospective seller still has to
convey title to the prospective buyer by entering into a contract of absolute sale.

It is essential to distinguish between a contract to sell and a conditional contract of sale specially in cases where
the subject property is sold by the owner not to the party the seller contracted with, but to a third person, as in
the case at bench. In a contract to sell, there being no previous sale of the property, a third person buying such
property despite the fulfillment of the suspensive condition such as the full payment of the purchase price, for
instance, cannot be deemed a buyer in bad faith and the prospective buyer cannot seek the relief of

6
reconveyance of the property. There is no double sale in such case. Title to the property will transfer to the buyer
after registration because there is no defect in the owner-seller's title per se, but the latter, of course, may be
used for damages by the intending buyer.

In a conditional contract of sale, however, upon the fulfillment of the suspensive condition, the sale becomes
absolute and this will definitely affect the seller's title thereto. In fact, if there had been previous delivery of the
subject property, the seller's ownership or title to the property is automatically transferred to the buyer such
that, the seller will no longer have any title to transfer to any third person. Such second buyer of the property
who may have had actual or constructive knowledge of such defect in the seller's title, or at least was charged
with the obligation to discover such defect, cannot be a registrant in good faith. Such second buyer cannot
defeat the first buyer's title. In case a title is issued to the second buyer, the first buyer may seek reconveyance of
the property subject of the sale.

The agreement could not have been a contract to sell because the sellers herein made no express reservation of
ownership or title to the subject parcel of land. Furthermore, the circumstance which prevented the parties from
entering into an absolute contract of sale pertained to the sellers themselves (the certificate of title was not in
their names) and not the full payment of the purchase price. Under the established facts and circumstances of
the case, the Court may safely presume that, had the certificate of title been in the names of petitioners-sellers
at that time, there would have been no reason why an absolute contract of sale could not have been executed
and consummated right there and then.

What is clearly established by the plain language of the subject document is that when the said "Receipt of
Down Payment" was prepared and signed by petitioners Romeo A. Coronel, et al., the parties had agreed to a
conditional contract of sale, consummation of which is subject only to the successful transfer of the certificate of
title from the name of petitioners' father, Constancio P. Coronel, to their names.

The provision on double sale presumes title or ownership to pass to the first buyer, the exceptions being: (a)
when the second buyer, in good faith, registers the sale ahead of the first buyer, and (b) should there be no
inscription by either of the two buyers, when the second buyer, in good faith, acquires possession of the
property ahead of the first buyer. Unless, the second buyer satisfies these requirements, title or ownership will
not transfer to him to the prejudice of the first buyer. In a case of double sale, what finds relevance and
materiality is not whether or not the second buyer was a buyer in good faith but whether or not said second
buyer registers such second sale in good faith, that is, without knowledge of any defect in the title of the
property sold. If a vendee in a double sale registers that sale after he has acquired knowledge that there was a
previous sale of the same property to a third party or that another person claims said property in a pervious sale,
the registration will constitute a registration in bad faith and will not confer upon him any right.

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Andres Lao vs. CA, the Associated Anglo-Amedican Tabacco Corp. and Esteban Co.February 17, 2000

Corporate Officers not personally liable for Authorized Corporate Acts

Facts: In 1965 a Contract of Sales Agent was entered by the Association of Anglo-American Tobacco Corporation
with Andres Lao. Lao was to sell cigarettes manufactured and shipped by the Corporation to his address in
Tacloban, and he would remit the sales proceeds. Lao would receive commission for those sold, with a monthly
salary and operational allowance.

In 1968 Laos attention was called to his enormous accounts and the difficulty in obtaining a tally despite his
avowal of regular remittance of collections. In 1969 it was established that his liability amounted to
P525,053. Also, the Corp. discovered that Lao was engaged in a construction business and suspecting that he
diverted the sale proceeds to such business, it gave a demand letter for payment of his obligations. It also found
that contrary to his allegations, he did not have a huge collectible from customers and nothing was due to the
Corporation. From then on, the Corp. no longer sent him shipments. In 1970, Andres, Jose and Tomas Lao
brought a complaint for accounting and damages against the Corp.. The court ordered both to undergo a court
supervised accounting but also ordered the Corporation to pay the Laos actual loss of earnings, moral damages,
exemplary damages, atty. fees and cost of suit.

Later the court gave a supplemental decision dismissing Laos claim of overpayment.

The Corp. and the Laos appealed.

The CA found the Corp. liable for actual damages of loss of earnings, moral damages and exemplary damages. It
also ordered the Corp. to pay the claim of overpayment by Lao. The Corp. file a motion for reconsideration and
during its pendency, Esteban Co, the new VP of the Corp. filed a complaint with the fiscal alleging Lao failed
to remit an amount which he allegedly misappropriated and converted to his own personal use. Pending the
criminal case, Lao filed against the Corp. and Esteban Co a complaint for malicious prosecution. The fiscal found
that Lao did not commit estafa and that his liability was civil. The trial court found the Corp and Esteban Co guilty
of malicious prosecution. They appealed. Co asserts that he cannot be held jointly and severally liable with the
Corp. as he was acting as executive vice president and his action was within the scope of his authority as such
corporate officer.

Issue: Whether or not Co should be held solidarily liable with the Corp.

Held: A perusal of his affidavit reveals that at the time he filed the complaint on June 1974, Co was vice president
of the Corp. As a corporate officer, his power to bind the Corp as its agent must be sought from statute, charter,
by-laws, a delegation of authority to a corporate officer, or from the acts of the board of directions, expressed or
implied from custom of doing business. In this case, no such sources of Cos authority from which to deduce
whether or not he was acting beyond the scope of his responsibilities are mentioned, or proven. It is logical to
conclude that the board or by-laws of the Corp. vested Co with certain executive duties, one of which is the case
for the Corp. That Cow as authorized to institute the estafa case is buttressed by the fact the Corp failed to make
an issue out of his authority to file the case. The defense should have been specially pleaded by the Corp. Its
failure to interpose such defense could only mean that the filing of Co was with consent and authority of the
Corp. Thus, Co may not be held personally liable for acts performed by him in pursuance of an authority.

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