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SALES CASES

CAPACITY OF PARTIES
LAO V GENATO
Sotero Dionisio Jr (heir and administrator of Rosenda Abutan) > Sotero III for
P75,000 > William Go for P80,000
Sotero III and Spouses Lao entered into a Mutual Agreement of Promise to Sell
Respondent Nuqui: Motion for Annulment / Revocation of the Deeds of Absolute
Sale- sale and subsequent transfer were made in violation of court order and that
consideration of two sales were grossly inadequate (many are willing to buy
property at P400,000)
Sotero Jr: actual consideration is P200,000
Respondent Nuqui: 2 sales were but a single transaction simultaneously hatched
and consummated in one occasion (Sotero III is without means or income and so has
no capacity to buy); transaction is to defraud the estate and his co-heirs
Petitioner Lao spouses: Manifestation in Intervention of Interest to Purchase
Property respondent-admin, without revealing that the property had already been
sold to Go, entered into a Mutual Agreement of Promise to sell to petitioners for the
amount of P220,000; upon execution of agreement, petitioners paid the earnest
money in the amount of P70,000
After hearing, respondent judge allowed all interested parties to bid. William Go
appeared to be the highest bidder.
FICTITIOUS SALE BY ADMINISTRATOR Sotero Jr is the administrator of the estate of his
deceased mother. As suchm he occupies a position of the highest trust and confidence. He is
required to exercise reasonable diligence and act in entire good faith in the performance of
that trust.
In the case at bar, the sale was made necessary in order to settle other existing obligations
of estate. Sale is fictitious, made to his very son Sotero III and for grossly low price.
FORNILDA V RTC
6 parcels of land were owned by deceased Julio Catolos
Some of the legal heirs (Francisca Catolos, Agnes catolos, Alfonso Fornilda, Asuncion
Pasamba) were represented by Atty. Sergio Amonoy
Jan 12, 1965: Project of Partition approved
August 6, 1969: estate declared closed and terminated
Jan 20, 1965: Fornilda and Pasamba executed a Contract of Mortgage in favour of
Atty. Amonoy as security for payment of attorney/s fees
Pasamba and Fornilda died
Mortgage indebtedness was not paid, Atty. Amonoy instituted foreclosure
proceedings; Atty. Amonoy as highest bidder
INVALID PURCHASE BY A LAWYER (Art 1491(5)) A lawyer is prohibited from acquiring
either by purchase or by assignment the property or rights involved which are the object of
litigation in which they intervene by virtue of their profession. At the time the mortgage
was executed, the relationship of lawyer and client still existed. Mortgage was executes

only 8 days after` the approval of Project of Partition, evidencing respondents intention to
protect his own interests and ride roughshod over that of his clients.
DIRECTOR OF LANDS V ABABA
Atty. Alberto Fernandez was the counsel of Maximo Abarquez in a civil case for
annulment of contract of sale and for recovery of land
During its appeal, Abarquez engaged in the services of atty. Fernandez. Unable to
pay his lawyer, Abarquez, executed a document (contract of contingent fee) obliging
himself to give his lawyer of whatever he might recover from Lots 5600 and 5602
should the appeal prosper. The case was resolved.
Petitioner refused to comply with his obligation, instead offered to sell the whole
parcels to Spouses Juan Larrazabal and Marta de Larrazabal
Atty. Fernandez filed an affidavit of adverse claim. Notwithstanding such, petitioner
spouses conveyed by deed of absolute sale 2/3 of the lands to Larrazabal spouses
CONTRACT OF CONTINGENT FEE NOT PROHIBITED Art 1491 prohibition does not apply
to cases where after completion of litigation the lawyer accepts on account of his fee, an
interest in the assets realized by the litigation. A contract for a contingent fee is not covered
by Art 1491 because the transfer or assignment of the property in litigation takes effect
only after the finality of favourable judgment.
SAROSA VDA DE BARSOBIA V CUENCO
Lot in controversy: one half portion of 2 adjoining parcels of coconut land @ Barrio
Mancapagao, Sagay, Camiguin, Misamis Oriental
Leodica Balisado > Spouses Patricio Barsobia and Epifania Sarosa > Ong King Po
(Chinese) > Victoriano Cuenco (naturalized Filipino)
Epifania usurped the property and sold to Pacita Vallar
Respondent Cuenco: forcible entry case against Epifania and complaint for recovery
and ownership of land against Epifani and Patricia
SPECIAL INCAPACITY: SALE TO ALIEN - Sale to Ong King Po was void and inexistent,
contrary to constitution. But the litigated property is now in the hands of a naturalized
Filipino. Respondent is the rightful owner!
HERRERA V LUY KIM GUAN
Natividad Herrera, legitimate daughter of Luis Herrera, now deceased
Luis Herrera, owner of 3 parcels of land and their improvements
Before leaving for China, executed a deed of General Power of attorney, authorizing
Luy Kim Guan to administer and sell his properties
Lot 1740 was sold by Luy Kim Guan in his capacity as attorney-in-fact to Luy Chay.
To secure a loan of P2000, a deed of mortgage to Zamboanga Mutaul Building and
Loan Assoc. was executed. He also executed deed of sale on favour of Lino Bangayan.
Luy Kim Guan sold to Nicomedes Salazar his one half participation in two lots
Luy and Nicomedes executed a deed of mortgage in favour of BPI to secure a loan.
Luy and Nicomedes sold Lot 4465 to Carlos Eijansantos and Lot 4467 Lino
Bangayan

Plaintiff Nativida filed a complaint for recovery. (all transactions mentioned are
fraudulent and were executed after the death of Luis Herrera and when power of
attorney was no longer operative.
LEGALITY OF TITLES ACQUIRED BY LUY CHAY AND LINO BANGAYAN Luy Chay as citizen
of Philippines. Bangayan had sufficiently established his Philippine citizenship. While Luy
Kim Guan is a Chinese citizen, nevertheless, inasmuch as he acquired his one-half share in
Lot 4467 in 1931, long before the Constitution was adopted.
Land sold to Chinese, who later sold it to a Filipino citizen, the sale to the latter
cannot be impugned.
GODINEZ V PAK LUEN
Plaintiffs filed a complaint alleging that they are heirs of Jose Godinez, who was
married to Martina Alvarez Godinez; during marriage of parents, said parents
acquired a parcel of land (Lot No. 94) of Jolo townsite in the name of Jose Godinez;
their mother dies leaving plaintiffs as sole surviving heirs
Without knowledge of plaintiffs, Jose Godinez sold the land to Fong Pak Luen,
Chinese
Fong executed a power of attorney in favour of Kwan Pun Ming, also an alien, who
conveyed and sold the land to Trinidad Navate, with full knowledge that Fong is a
Chinese; Fong has not acquired any title
Petitioner: since of the conjugal property inherited by plaintiff, Godinez could not
legally convey the entire property; Godinez failed to surrender the property despite
demands
W/N THE HEIRS OF A PERSON WHO SOLD A PARCEL OF LAND TO AN ALIEN MAY
RECOVER THE PROPERTY IF IT HAD BEEN CONVEYED TO A FILIPINO CITIZEN Under
the Constitution, aliens may not acquire private or agricultural lands. Consequently,
prescription may never be invoked to defend that which Constitution prohibits. However,
we see no necessity from the facts to pass upon the nature of the contract of sale executed
by Jose Godinez and Fong Pak Luen whether void, illegal per se, or merely prohibited. It is
enough to stress that in so far as the vendee is concerned, prescription is unavailing. But,
neither can the vendor or his heirs rely on an argument based on imprescriptibility
because the land sold in 1941 is now in the hands of a Filipino citizen against whom the
constitutional prescriptiom was never intended to apply. From the fact that prescription
may not be used to defend a contract which the Consti prohibits, it does not necessarily
follow that the applicants may be allowed to recover the property sold to an alien.
HULST V PR BUILDERS
Petitioner Hulst: Motion for Partial Reconsideration (Contract to sell involving a
condominium unit did not violate the Constitutional proscription agaimst
ownership of land by aliens; buyer will not get atransfer certificate of titile but
merely a condominium certificate of title)
RA 4726 (CONDOMINIUM ACT) foreign nationals can own Philippine real estate through
the purchase of condo units or town houses. It expressly allows foreigners to acquire condo
units and shares in condo corporations up to not more than 40% of the total and
outstanding capital stock of a Filipino-owned or controlled corporation.

Ownership of the land is legally separated from the unit itself.


DELIVERY
ALCANTARA-DAUS V DE LEON
Parcel of land @ San Manuel, which Hermoso de Leon inherited from his father
Marcelino de Leon *( Deed of Extrajudicial Partition)
Hermoso de Leon engaged in the services of late Atty. Florencio Juan to take care of
the documents of his parents properties
After death of Atty. Juan, some documents revealed that their properties had been
conveyed by sale or quitclaim to Hermosos brothers and sisters, to Atty. Juan and
his sisters, when in truth no such conveyances were ever intended by them.
They discovered that land in question was sold by Rodolfo de Leon to Aurora
Alcantara.
SELLERS OWNERSHIP AT THE TIME OF DELIVERY During perfection stage, sellers
ownership of the thing sold is not an element. The contract, however, creates an obligation
on the part of the seller to transfer ownershiop and to deliver the subject matter. It is
during the delivery that the law requires vthe seller to have right to transfer ownership of
the thinbg sold. It is trough tradition or delivery that the buyer acquires the real right of
ownership over the things sold.
Rosolfo was not the owner of the land he delivered to petitioner. Thus, the consummation
of contract and the consequent transfer of ownership would depend whether he
subsequently acquired ownership of land (1434).
SAMPAGUITA PICTURES V JALWINDOR MANUFACTURERS
Sampaguita Pictures is the owner of the Sampaguita Pictures Building, leased to
Capitol 300, with the agreement that it shall be used for social purposes exclusively,
and that improvements made by lessee shall belong to the lessor
Capitol purchased on credit from Jalwindor Manufacturers glass and wooden
jalousies which were delivered and installed in the leased premises
Jalwindor: action for collection of sum of money for its failure to pay. Entered into a
compromise agreement
Capitol also failed to pay rentals to Sampaguita
Sampaguita filed complaint for ejectment and for coillection of sum of money
Capitol failed to comply with compromise agreement. Sheriff made alevy on the
glass and wooden jalousies.
Sampaguita filed a third part complaint alleging that it is the owner
SAMPAGUITA AS THE OWNER; INVALID LEVY When jalousies were delivered snd
installed to leased premises, Capitol became the owner thereof. Ownership is
transferred by delivery, actual or constructive. Having entered into lease contract with
Sampaguita, latter became the owner. When levy was made on said items, Capitol was
no longer the owner thereof.

NATIONAL BANK V LO
Severo Eugenio Lo and Ng Khey Ling ( with JA Say Lian Ping, Ko Tiao Hun, On Yem
Ke Lam and Co Sieng Peng) fromed a commercial partnership Tai Sing & Co.
Partnership was to last for five years, with the purpose to do business in Iloilo for
the purchase and sale of merchandise, goods and native, as well as Chinese and
Japanese products
JA Say Lian Ping was appointed general manager of partnership; executed a power
of attorney in favour of AY Kelam, authorizing him to act in his stead as manager and
administrator of Tai Sing & Co.
AY Kelam applied for and obtained a loan of P8000 from National Bank, renewed
several times
AY Kelam as attorney-in-fact executed a chattel mortagage in fabor of NB as security
for a loan
AY Kelam and Tai Sing & Co executed another chattel mortgage
Yap Seng, Severo Eugenio Lo, AY Kelam and Ng Khey Ling, latter represented by M.
Pineda Tayenko, executed a power of attorney in favour of Sy Tit; Sy Tit,
representing Tai Sing & Co, obtained a credit of P20,000 from NB, executing a
chattel mortgage on certain personal property belonging to Tai Sing & Co.
Defendant Eugenio: Tai Sing & Co. was not a general partnership; commercial credit
in current account which tai Sing & Co obtained from the NB had not been
authorized by board of directors, nor was the person who subscribed said contract
authorized to make the same, under articles of co-partnership.
PROPERTY NOT INCLUDED IN PARTNERSHIP ASSETS Partnership property described in
the mortgage no longer existed at the time of the filing of the complaint nor has its
existence been proven, nor was it offered to the plaintiff for sale. Therefore, appellants
shall be personally and solidarily liable with all their property, for the results of
transactions made in the name and for the account of the partnership, under the signature
of the latter, and by a person authorized to use it.
NORKIS DISTRIBUTORS V CA
Norkis Distributors is the distributor of Yamaha motorcycles in Negros Occidental
Alberto Nepales bought brand new Yamaha Wonderbike motorcycle (P7500),
payable by means of a Letter of Guaranty from DBO
As a security of loan, Nepales executed chattel mortgage on motorcycle
Branch Manager of Norkis issued Sales Invoice showing that contract of sale had
been perfected
Motorcycle was registered in Land Transportation Commission in the name of
Alberto nepales
Motorcycle was delivered to certain Julian Nepales, allegedly agend of Alberto but
latter denies it
The motorcycle met an accident
ACTUAL INTENTION OF VENDOR TO DELIVER AND ITS ACCEPTANCE BY THE VENDEE.The issuance of a sales invoice does not prove the transfer of ownership of the thing sold to
the buyer. An invoice is nothing more than a detailed statement of the nature, quantity and
cost of the thing sold and has been considered not a bill of sale.

Act of delivery whether actual or constructive must be coupled with intention of delivering
the thing.
When the motorcycle was registered by Norkis in the name of private respondent, Norkis
did not intend yet to transfer the title of ownership to Nepales, but only to facilitate the
execution of a chattel mortgage in favour of DBP for the release of buyers motorcycle loan.
PHIL SUBURBAN DEV CORP V THE AUDITOR GENERAL
President of Phils approved the acquisition by the Peoples Homesite and Housing
Corporation of the unoccupied portion of Sapang Palay Estate in Sta. Naria, Bulacan
for relocating the squatters who desire to settle north of Manila and of another area
in Las Pnas or Paranaque, Rizal or Bacoor, Cavite. The project was to be financed
through the floatation of bonds under the character of PHHC in the amount of P4.5M
Board of Directors of PHHC passed Reso No 700 aouthorizing the purchase of the
unoccupied portion of the Spang Palay at P0.45 per square meter
Phil Suburban as the owner of the unoccupied portion of Sapang` Palay and PHHC
entyered into a contract embodied in a public instrument Deed of Absolute Sale
whereby the former conveyed to latter two parcels of land. Not registered in The
Office of the Register of deeds. Auditor General expressed objection.
Prior to the signing of deed by the parties, PHHC acquired possession of the
property with the consent of petitioner
Provincial Treasurer of Bulacan requested PHHC to withhold the amount of
P30,099.79 from purchase price to be paid by it to PHHC, represented real tax from
1961
Petitioner: paid under protest, claiming that it ceased to be the owner of the land in
question upon the execution of the Deed of Absolute Sale
Respondent: Presumptive delivery of the property under Art 1498 does not apply
because of the requirement in the contract that the sale shall be first approved by
Auditor General. Until deed of absolute sale has been actually registered, the vendor
remains as the owner of said property.
EXECUTION EQUIVALENT TO DELIVERY; REGISTRATION NOT REQUIRED When tha sale
of real property is made in a public instrument, the execution thereof is equivalent to the
delivery of the thing object of the contract. Vendor has actually placed the vendee in
possession and control over the thing sold, even before the date of the sale.
Registration is not necessary to make it valid and effective, for actual notice is equivalent to
registration. The registration is intended to protect the buyer against clains of third
persons arising from subsequeny alienations by the vendor, not necessary to give effect to
the deed of sale, as between the parties to the contract.
ADDISON V FELIX AND TIOCO
Addison sold to Marciana Felix, with consent of her husband, 4 parcels of land. Felix
paid at the time of execution of the deed P3000 and bound herself to pay the
remainder in installment within ten years from the date of certificate of title, P10
each for each coconut tree in bearing and P5 for each tree not bearing

Stipulated that` the purchaser was to deliver to the vendor 25% of the value of
products she might obtain form the parcels from the moment she takes possession
until the Torrens cert of title be issued in her favour
Addison filed suit to compel Felix to make payment of the first instalment.
Defendant answered that the plaintiff failed to deliver the lands notwithstanding the
demands
After execution of deed of sale, Addison went to Lucena for the purpose of
designating and delivering the lands sold. Able to designate only 2 out of 4 parcels
and more than 2/3 of these were found in the possession of one Juan Villafuerte
TC: in favour of Felix, rescinded the contract
IN EXECUTION = DELIVERY, NECESSARY THAT VENDOR HAS SUCH CONTROL OVER THE
THING SOLD AT THE MOMENT OF SALE Mere execution was not a fulfilment of the
vendees obligation to deliver, and that from such non-fulfillment arises the purchasers
right to demand, and as she demanded, the rescission of the sale and the return of the price.
TEN FORTY REALTY AND DEVT CORP V CRUZ
Complaint for ejectment filed by Ten Forty against Marina Cruz
Ten Forty is the true and absolute owner of a parcel of lot and residential house @
Olongapo City, having acquired the same from Barbara Galino by virtue of Deed of
Sale
Petitioner came to know that Galino sold the same property to Cruz, who
immediately occupied the said property, which was tolerated by petitioner
Ten Forty filed a case for unlawful detainer against Cruz
PRESUMPTION OF TRANSFER OF OWNERSHIP UPON EXUCUTION DESTROYED BY NONDELIVERY Execution of public instrument gives rise only to a prima facie presumption of
delivery. Such presumption is destroyed when delivery is not affected because of legal
impediment. Petitioner did not occupy the property from the time it was allegedly sold to
in on December 5, 1996 or at any time thereafter. RTC and Ca disagreed to petitioners
claim that Galinos continued stay in the premises from the time of sale up to the time
respondents occupation of the same on April 24, 1998, was possession held on its behalf
and had the effect of delivery under the law. Petitioner should have likewise been put on
guard by respondents declaration of property for purposes of tax on April 23, 1998, which
represented adverse claim over the unregistered property.
HEIRS OF ARTURO REYES V SOCCO-BELTRAN
Parcel of land (Lot No 6-B) @ Zamora St., Dinalupihan, allocated to Spuses Laquian
(marcelo and Constancia), who paid for the same with Japanese money.
When Marcelo died, left the land to Constancia; upon Constancias death, left with
her heirs (siblings: Filomena, Isabel, Miguel Socco, Elena); parcel was partitioned
Elena filed an application for purchase of Lot No 6-B
Petitioners, heirs of Arturo, filed protest on the ground that subject property was
sold (contract to sell) by respondents brother, Miguel Socco in favour of their
father, Arturo; they took physical possession of property in 194 and had been
uninterrupted in their possession.

VENDORS OWNERSHIP AT THE TIME OF DELIVERY (FUTURE INHERITANCE) Miguel


Socco was not yet the owner of the subject property and was merely expecting to inherit
the same as his share as co-heir of Constancias estate. It was a conditional sale sale of
property in favour of Arturo was conditioned upon the event that Miguel Socco would
actually inherit and become the owner. No valid sale.
RUDOLF LIETZ, INC V CA
Agapito Buriol previously owned a parcel of unregistered lsnd @ Capsalay Island,
Port Barton, San Vicente, Palawan
Buriol enetered into alease agreement with Flavia Turatello and respondent
Turatello and Sani (Italian), involving 1 hectare of Buriols property for period of 25
years, renewable for another 25 years
Buriol sold to Rudolf Lietz, Inc the same parcel of land for P30,000
Petitioner discovered that Buriol owned only 4 hectares and with one more hectare
covered by lease, only three hectares were actually delivered to petitioner.
Petitioner sought for annulment of lease with recovery of possession with injuction
and damages evident bad faith and malice
DELIVERY OF VENDOR LESS THAN THE AREA AGREED vendee may oblige the vendor to
deliver all that may be stated in the contract or demand for the proportionate reduction of
the purchase price if the delivery is not possible.
If the vendor delivers more than the area stated in the contract, the vendee hsd the option
to accept only the amount agreed upon or to accept the whole area, provided he pays for
the additional area.
SALINAS V FAUSTINO
Bienvinido Faustino, by Deed of Sale, purchased from his co-heirs their respective
shares to a parcel of land coverd by Tax Declaration No. 14687, with superficial area
of 300.375 sqm more or less
Faustino joined by his wife filed a complaint for recovery of possession alleging that
the parcel of land he bought via Deed of Sale from his co-heirs consisted of 1381
sqm; they allowed petitioner and co-heirs to occupy and build a house on a 627 sqm
portion of land on the condition that they would voluntarily and immediately
remove the house and vacate the land should they need the land
Petitioner: owner of 628 sqm
CONTRACT OF SALE OF LAND IN A MASS The specific boundaries sated in the contract
with respect to the area contained within the boundaries. Thus, it is the boundaries
indicated in a deed of sale, not the area in sqm mentioned therein that control in the
determination of which portion of the land the vendee acquires.
DE LEON V ONG
Raymond De Leon sold 3 parcels of land with improvements @ Antipolo Rizal to
Benita Ong
As these properties were mortgaged to Real Savings and Loan Association, Inc.
(RSLAI), De Leon and Ong executed a notarized deed of absolute sale with
assumption of maortgage

Ong gave De Leon P415,500 as partial payment; de leon handed the keys and wrote
a letter to RSLAI of the sale and authorizing it to accept payment from Ong and
release certificates of title
Ong undertook repairs and made improvements on the properties
Ong learned that de Leon again sold the same properties to Leona Viloria and
changed the locks; informed by RSLAi that De Leon already paid the amount due and
had taken back the certificates of title
Ong filed complaint for specific performance and declaration of nullity
SELLERS OBLIGATION TOTRANSFER TITLE AND DELIVER Art 1498 provides that
execution of notarized deed of sale is equivalent to delivery. Totality of petitioners acts
(execution, turn over of keys, authorization to RSLAI) indicates that he had unqualifiedly
delivered and transferred ownership of the properties to respondent. It was a contract of
sale.
ASSET PRIVATIZATION TRUST V TJ ENTERPRISES
Asset Privatization Trust (government entity created for the purpose to conserve, to
provisionally manage and to dispose assets of the government institutions) acquired
from DBP assets consisting of machinery and refrigeration equipment, stored at
Golden City compound, Pasay City (which was leased to and in the physical
possession of Creative Lines, Inc. Assets were being sold on an as-is where-is basis.
Asset Privatization and TJ Enterprises entered into absolute deed of sale over
certain machinery and refrigeration equipment (Lot Nos. 2, 3, 5), paid in full P84000
After 2 days, demanded delivery; petitioner issued Gate Pass 4955
Respondent was able to pull out from the compound properties (Lots 3 and 5).
During hauling of Lot 2, consisting 16 items, only 9 items were pulled out
Responded filed a complaint for specific performance
NO CONSTRUCTIVE DELIVERY Presumption that execution of deed of sale is equivalent
to delivery is destroyed when the delivery is not effected because of a legal impediment. It
is necessary that the vendor shall have control over the thing sold that, at the moment of
sale, its material delivery could have been made. Thsu, aperson who does not have actual
possession of the thing sold cannot transfer constructive possessionby execution and
delivery of public instrument.
AS-IS WHERE-IS BASIS Pertains solely to the physical condition of the thing sold, not its
legal situation. It is merely descriptive of the state of the thing sold. The depiction does not
alter petitioners liability to deliver the property to respondent.
BOARD OF LIQUIDATORS V FLORO, ET.AL
Melencio Malabanan entered into an agreement with the Board of Liquidators for
the salvage of surplus properties sunk in territorial water off the provinces of
Mindoro, La Union and Batangas
Malabanan was to commence operations within 30 days from execution of said
contract, which was to be effective for a period of one year from the start of
operations, extendible for a total period of not more than 6 months
Malabanan requested for an extension of one year for salvage in waters of Mindoro
and batangas, Board extended the contract

Malabanan requested second extension of one more year for the waters of
Occidental Mindoro, Board extended the contract
4 moths previously, Malabanan entered into an agreement with Exequiel Floro that
Floro would advance to Malabanan certain sums of money, not to exceed P25000,
repayment being secured by quantities of steel mattings which Malabanan would
consign to Floro. Upon default, Floro was authorized to sell whatever steel mattings
in his possession in an amount sufficient to satisfy the advances
Malabanan unable to pay; Floro sold 11, 047 pieces of steel mattings to Eulalio
Legaspi
17 days later, Malabanan filed a petition for voluntary insolvency
Board claiming to be the owner of steel mattings, filed a petition to exclude them
from the inventory
RESERVATION OF TITLE The contract between Malabanan and the Board had the
effect of vesting Malabanan with title to, or ownershipof, the steel mattings in question
as soon as they were brought up from the bottom of the sea. While there can be
reservation of title in the seller until full payment of price (1478), or until fulfilment of
condition (1505), and while the execution of public instrument amounts to delivery
only when from the deed the contrary does not appear or cannot clearly be inferred,
there is nothing in the said contract which may be deemed a reservation of title, or from
which it may clearly be inferred that delivery was not intended.
TRADITIO LONGA MANU (1499) There was no physical tradition. There was one by
agreement.
SAN LORENZO DEVT CORP V CA
Miguel Lu and`Pacita Zavalla (Spouse Lu) owned 2 parcels of land @ Sta. Rosa,
Laguna
Spouses Lu sold to Pablo Babasanta for P15 per sqm. Babasanta made a
downpayment of P50000. Several other payments (totalling P200,000) were made
by Babasanta
Babasanta wrote to Pacita Lu demanding the execution of a final deed of sale so that
he could effect full payment. Notified spouses Lu about having knowledge of second
sale to another and such be cancelled
Lu: reminded Babasanta that when balance of purchase price became due, he
required for a reduction of price and when she refused, Babasanta backed out the
sale. She returned P50,000 to Babasanta through Eugenia Oya
Babasanta filed before RTC a complaint for specific performance
Spouses Lu: Pacita obtained loans from Babasanta and when total advances of Pacita
reached P50,000, the latter and Babasanta had verbally agreed to transform the
transaction to contract to sell the 2 parcels to Babasanta with downpayment of
P50,000
SLDC filed motion for intervention: owner of the parcels by Deed of Absolute Sale
with Mortgage; purchaser in good faith
WHO HAS BETTER RIGHT BETWEEN SLDC AND BABASANTA? Babasanta did not acquire
ownership by the mere execution of the receipt by Pacita Lu acknowledging receipt of
partial payment for the property. The agreement between Babasanta and Spouses Lu,

though valid, was not embodied in a public instrument. Hence, no constructive delivery has
been effected. Babasanta had not taken possession of the property at any time after the
perfection of the sale in his favour or exercised acts of dominion over it despite his
assertions that he was the rightful owner of the lands, NO delivery to Babasanta, actual or
constructive,
DOUBLE SALE (1544) Principle of primus tempore, potior jure (first in time, stronger in
right).
The one who acquires and first records it in the Registry of Property, both made in good
faith, shall be deemed the owner.
As early as Feb 11, 1989, Spouses Lu executed Option to Buy in favour of SLDC upon
receiving of Absolute Sale in favour of SLDC. At time of execution, SLDC has no knowledge
of prior transaction wih Babasanta. Upon learning, SLDC registered the sale with registry of
Property. Thus, SLDC has better right.
ABUAN V GARCIA
Acquired by Laurencio Abuan, the homestead passed afterbhis death to his legal
heirs (plaintiffs)
Plaintiffs sold the parcel of land to defendants (Deed of Abosolute Sale)
Plaintiffs: action to recover the land, alleging that deed of sale had been executed
through fraud, without consideration
Subsequently settled amicably (defendants paid P500 as partial payment, promised
to pay balance of P1500 on or before April 30, 1955, with grace period of 30 days)
Full payment effected only sometime in May 1955; Plaintiffs instituted present
action for legal redemption
Defendants: Motion to dismiss; plaintiffs right of action already barred because 5year redemption period had already expired
WHEN DID THE 5-YR PERIOD BEGIN TO RUN? UPON EXECUTION OF DEED OF SALE?
UPON ENTERING INTO COMPROMISE AGREEMENT? UPON FULL PAYMENT? It is
counted from either of the first two dates. Law speaks of five year period upon
conveyance It ia apparent that five years had elapsed since the execution of the deed of
absolute sale at the time plaintiffs filed the action for redemption.
DY, JR. V CA
Perfecto Dy and Wilfredo Dy are brothers.
Wilfredo Dy purchased a truck and a farm tractor through financing extended by
Libra Finance and Investment Corp, both were mortgaged to Libra as security loan.
Petitioner Perfecto wanted to Buy the tractor from his brother; he wrote a letter to
Libra requesting that he be allowed to purchase and assume the mortgage,
approved
Wilfredo executed a deed of absolute sale
At this time, subject tractor was in the possession of Libra Finance due to Wilfredos
failure to pay amortizations
Libra refused to release the tractor despite petitioners offer to pay in full because it
also insisted for the payment of truck

Wilfredo convinced her sister Carol Dy-Seno to purchase the truck; issued a check;
Libra insisted it should be cleared first before the release
Meanwhile, a collection case to recover sum of money Gelac Trading v Wilfredo Dy
was pending; provincial sheriff was able to seize and and levy on tractor which was
on the premises of Libra; tractor was sold in public auction where Gelac Trading
was the lone bidder, which later sold to Antonio Gonzales
When check was cleared, petitioner learned about the Gelac having taken custody of
the tractor
Wilfredo filed an action to recover
CONSTRUCTIVE DELIVERY Art 1496 states that the ownership of the thing sold is
acquired by the vendee from the moment it is delivered to him in any of the ways specified
in Arts 1497-1501 or in any other manner signifying agreement that the possession is
transferred from the vendor to the vendee. (Note: Art 1498 and 1499) Actual delivery of
the subject tractor could not be made. However, there was a constructive delivery already
upon the execution of the public document (1498) and upon the consent or agreement of
the parties when the thing sold cannot be immediately transferred to the possession of the
vendee.
MORTGAGEE CANNOT BECOME THE OWNER - While it is true that Wilfredo was not in
actual possession and control of the subject tractor, his right of ownership was not divested
from him upon its default. Neither could it be said that Libra was the owner of the subject
tractor because the mortgagee cannot become the owner of or convert and appropriate to
himself the property mortgaged (Art 2208). Said property continues to belong to the
mortgagor. The only remedy of the mortgagee is to have the said property sold at public
auction and the proceeds of the sale applied to the payment of obligation secured by the
mortgagee.
INDUSTRIAL TEXTILE MANUFACTURING COMPANY OF THE PHILS V LPJ ENTERPRISES
LPJ enterprises had a contract to supply 300,000 bags of cement per year to Atlas
Consolidated Mining and Development Corporation, a member of the Soriano Group
of Companies.
Cesar Campos (VP of Industrial Textile) asked Lauro Panganiban Jr (President of
LPJ) if he would like to cooperate in an experiment to develop plastic cement bags,
Panganiban acquiesced.
Panganiban accompanied Paulino Ugarte (another VP of Industrial) to the factory of
respondents supplier, Luzon Cement Corp in Norzagaray, Bulacan, to test 50 pieces
of plastic cement bags; unsuccessful; second trial was likewise a failure.
Finally, with 300 improved bags, seepage was reduced.
Ugarte asked Panganiban to send 180 bags of cement to Atlas via commercial
shipping; Campos, Ugarte and two other officials of Industrial followed the 180 bags
to Plant of Atlas in Sangi, Toledo, Cebu where they professed satisfaction at the
performance of their own plastic bags
Campos sent Panganiban a letter proclaiming drastic results in the experiment;
Panganiban agreed to use the plastic cement bags. Four purchases were issued.
Industrial delivered, respondent remitted the payments, leaving a balance of
P84,123.80

No other payments were made; petitioner sent demand letters to respondent


corporation.
Respondent: admitted liability in first purchase order, but denied second, third,
fourth purchase orders. As for the remaining 47,000 bags, workers of Luzon Cement
objected to the use thereof due to serious health hazards. Petitioner was asked to
take back the unused plastic bags.
Petitioner: respondents obligation to return the bags to them. Failure to do so,
petitioner demanded payment.
SALE OR RETURN / SALE ON APPROVAL Art 1502 inapplicable because to make sales
contract either a sale or return or a sale on approval, it clearly requires a written
agreement. Parol or extrinsic testimony could not be admitted for the the purpose of
showing that an invoice or bill of sale that was complete in every aspect and purporting to
embody a sale without condition or restriction constituted a contract of sale or return. If
the purchaser desired to incorporate a stipulation securing him the right to return, he
should have done so at the time the contract was made. On the other hand, the buyer
cannot accept part and reject the rest of the goods since this falls outside the normal intent
of the parties in the on approval situation.