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Edres - Lorenzo Velasco v. CA

Lorenzo Velasco sued Magdalena Estate Inc. claiming they entered into a contract for Velasco to purchase land for 100,000 pesos, with Velasco making a 30,000 peso down payment. However, Magdalena Estate refused the additional 20,000 peso payment Velasco tendered, claiming no contract existed. The court ruled no contract was perfected, as the parties did not agree on the manner of payments - whether down payment and installments were still to be determined. A binding contract requires agreement on essential elements like payment terms. The initial 10,000 peso payment did not prove a sale contract existed where payment details remained undefined.

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46 views2 pages

Edres - Lorenzo Velasco v. CA

Lorenzo Velasco sued Magdalena Estate Inc. claiming they entered into a contract for Velasco to purchase land for 100,000 pesos, with Velasco making a 30,000 peso down payment. However, Magdalena Estate refused the additional 20,000 peso payment Velasco tendered, claiming no contract existed. The court ruled no contract was perfected, as the parties did not agree on the manner of payments - whether down payment and installments were still to be determined. A binding contract requires agreement on essential elements like payment terms. The initial 10,000 peso payment did not prove a sale contract existed where payment details remained undefined.

Uploaded by

Derek Jamzy
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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CASE 214

Lorenzo Velasco v. CA
G.R. No. L-31018 / June 29, 1973

FACTS OF THE CASE:

On November 29, 1962 the Lorenzo Velasco and Magdalena Estate Inc. entered
into a Contract of Sale for a piece of land with a total area of 2,059 sq. m. located at No.
39 corner 6th Street and Pacific Avenue, New Manila, Quezon City, for a total purchase
price of P100,000.00

It is alleged by Velasco that the terms of the agreement were that he was to give
a downpayment of P10,000.00 to be followed by P20,000.00 and the balance of
P70,000.00 would be paid in installments, the equal monthly amortization of which was
to be determined as soon as the P30,000.00 down payment had been completed.

That Velasco paid of P10,000.00 on November 29, 1962 and that when on January
8, 1964 he tendered the payment of the additional P20,000.00 to complete the
P30,000.00, Magdalena Estate refused to accept the payment and that it likewise refused
to execute a formal deed of sale obviously agreed upon. Thus Velasco filed a complaint
for Specific Performance before the Court of First Instance of Quezon City.

Magdalena Estate rebuffed the claim of Velasco and it stated that it never had any
transactions or contractual relations with Velasco regarding the property in question. It
stated that the subject property was being leased by Socorro Velasco who on November
29, 1962, went to the office of the defendant corporation indicated her desire to purchase
the lot.

That the defendant indicated its willingness to sell the property at the price of
P100,000.00under the condition that a down payment of P30,000.00 be made,
P20,000.00 of which was to be paid on November 31, 1962, and that the balance of
P70,000.00 including interest a 9% per annum was to be paid on installments for a period
of ten years.

On November 29, 1962 Socorro paid 10,000, short of the alleged 20,000 agreed
down payment, the same was accepted merely as deposited and upon request of Socorro
Velasco the receipt was made in the name of her brother-in-law of Lorenzo Velasco.

On January 8, 1964 Socorro tendered the 20,000 down payments but defendant
refused to accept because the latter considered the contract rescinded on the account
the former’s failure to complete the down payment on or before December 31, 1962.

On November 3, 1968, the Court of First Instance of Quezon City, after hearing on
the merits, rendered a decision, dismissing the complaint filed by Lorenzo Velasco against
the Magdalena Estate, Inc. on the basis that the alleged purchase and sale agreement
"was not perfected".

ISSUE/s:

Whether or not a Contract of Sale was perfected between Lorenzo Velasco and
Magdalena Estate Inc.?
RULING:

No. The minds of the parties did not meet “in regard to the manner of payment.” It
is not difficult to glean from the aforequoted averments that the petitioners themselves
admit that they and the respondent still had to meet and agree on how and when the
down-payment and the installment payments were to be paid. Such being the situation, it
cannot, therefore, be said that a definite and firm sales agreement between the parties
had been perfected over the lot in question.

Indeed, this Court has already ruled before that a definite agreement on the
manner of payment of the purchase price is an essential element in the formation of a
binding and enforceable contract of sale. The fact, therefore, that the petitioners delivered
to the respondent the sum of P10,000 as part of the down-payment that they had to pay
cannot be considered as sufficient proof of the perfection of any purchase and sale
agreement between the parties herein under article 1482 of the new Civil Code, as the
petitioners themselves admit that some essential matter — the terms of payment — still
had to be mutually covenanted.

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