Cadungog v Yap Ponente: Callejo, Sr. J.

Facts: Virgilio Cadungog executed a deed of sale with the right to repurchase on August 17, 1979. Through the document, Cadungog sold to his cousin Franklin Ong six parcels of land. Based on the deed of sale, Cadungog had the right to repurchase within 10 years from the mentioned date. Virgilio, however, failed to redeem the subject property. Subsequently, he executed a deed of absolute sale in favour of Jocelyn Yap, Franklins sister. Such sale covered three parcels of land for P5,000. Thereafter, Virgilio filed a complaint for the declaration of nullity of the deed of absolute sale against Yap. Virgilio asseverated that the deed was fictitious because it had been merely executed to afford Yap claim for the reduction of her tax liabilities in Canada. Furthermore, he pointed out that after the supposed sale, Yap made no move in order to consolidate her ownership over the property. The trial court held that Cadungog was able to repurchase the six parcels of land on May 25-26, 1997 which was after the lapse of 18 years, upon payment to Ong of the amount of P50k. Moreover, the court held that the 10-year redemption period was to be regarded as extended because of the failure of Ong to consolidate his title over the property. Issue: Whether or not there was impairment of the title over the property of the vendee a retro because of his failure to consolidate the sale Ruling: The Supreme Court answered in the negative. The court ruled that the failure of the vendee a retro to consolidate the title under Article 1607 of the Civil Code did not impair such title and ownership because the methods and procedure prescribed was merely for the purpose of registering and consolidating the titles to the property. It declared that it was Franklin Ong and not petitioner should be regarded as the lawful ofwner of the six parcels of land. Cadungod had therefore no right to mortgage or sell the land to Yap on September 10, under the deed of absolute sale. The decision of the appellate court that Yap had acquired ownership over the three parcels of land was declared erroneous. Cadungod, not being the owner of the land, could not have been then sold lawfully the parcels to responded Jocelyn Yap.