CORTES vs.

Court of Appeals

obligation that would justify the rescission of the contract of

494 SCRA 570 (Art. 1169)

sale? THERE IS DELAY IN BOTH PARTIES (compensation

morae)

Facts:
For the purchase price of 3.7M, Villa Esperanza Development

Held:

Corporation (vendee) and Antonio Cortes (vendor) entered

Cortes avers that he delivered the TCTs through the brokers

into a contract of sale over the lots located at Baclaran,

son. He further avers that the brokers son delivered it to the

Paraaque, Metro Manila. The Corporation advanced to Cortes

broker, who in turn delivered them to the Corporation.

the total sum of P1,213,000.00. In September 1983, the parties

executed a deed of absolute sale on the following terms:

Marcosa Sanchezs unrebutted testimony is that, she did not

The Corporation shall advance 2.2 M as downpayment, and

receive the TCTs. She also denied knowledge of delivery

Cortes shall likewise deliver the TCT for the 3 lots.

thereof to her son, Manny.

The balance of 1.5M shall be payable within a year from the

date of the execution.

What further strengthened the findings of the Court of Appeals

that Cortes did not surrender the subject documents was the

The Corporation filed the instant case for specific performance

offer of Cortes counsel at the pre-trial to deliver the TCTs and

seeking to compel Cortes to deliver the TCTs and the original

the Deed of Absolute Sale if the Corporation will pay the

copy of the Deed of Absolute Sale. According to the

balance of the down payment. Indeed, if the said documents

Corporation, despite its readiness and ability to pay the

were already in the hands of the Corporation, there was no

purchase price, Cortes refused delivery of the sought

need for Cortes counsel to make such offer.

documents. It prayed for damages, attorneys fees and

litigation expenses. Cortes claimed that the owners duplicate
copy of the three TCTs were surrendered to the Corporation
and it is the latter which refused to pay in full the agreed down
payment.

Considering that their obligation was reciprocal, performance

thereof must be simultaneous. The mutual inaction of Cortes
and the Corporation therefore gave rise to a compensation
morae or default on the part of both parties because neither has
completed their part in their reciprocal obligation. Cortes is yet

RTC rendered a decision rescinding the sale and directed

to deliver the original copy of the notarized Deed and the

Cortes to return to the Corporation the amount of

TCTs, while the Corporation is yet to pay in full the agreed

P1,213,000.00, plus interest. CA reversed the decision and

down payment of P2,200,000.00. This mutual delay of the

directed Cortes to execute a Deed of Absolute Sale conveying

parties cancels out the effects of default, such that it is as if no

the properties and to deliver the same to the Corporation

one is guilty of delay.

together with the TCTs, simultaneous with the Corporations

payment of the balance of the purchase price of
P2,487,000.00.

Under Article 1169 of the Civil Code, from the moment one of
the parties fulfills his obligation, delay by the other begins.
Since Cortes did not perform his part, the provision of the

Issue:

contract requiring the Corporation to pay in full the down

WON Cortes delivered the TCTs and the original Deed to the

payment never acquired obligatory force.

Corporation? NO.
WON there is delay in the performance of the parties