ROBERN DEVELOPMENT CORPORATION vs.
PEOPLE'S it with copies of the Head Office’s rejection letter of PELA’s bid,
LANDLESS ASSOCIATION
FACTS
Al-Amanah Islamic Development Bank of the Philippines (Al-
Amanah) owned a 2000-squaremeter lot located in Magtu-od,
Davao City. On December 12, 1992, Al-Amanah Davao Branch,
thru its officer-in-charge Febe O. Dalig (OIC Dalig), asked some
of the members of People's Landless Association(PELA) to
desist from building their houses on the lot and to vacate the
same, unless they are interested to buy it. The informal settlers
thus expressed their interest to buy the lot at P100.00 per
square meter, which Al-Amanah turned down for being far
below its asking price.
Consequently, Al-Amanah reiterated its demand to the
informal settlers to vacate the lot.
In a letter dated March 18, 1993, the informal settlers
together with other members comprising PELA offered to
purchase the lot for P300,000.00, half of which shall be paid as
down payment and the remaining half to be paid within one
year. In the lower portion of the said letter, Al- Amanah made
the following annotation:
Note: Subject offer has been acknowledged/received but
processing to take effect upon putting up of the partial amt. of
P150,000.00 on or before April 15, 1993.
By May 3, 1993, PELA had deposited P150,000.00 as evidenced
by four bank receipts. For the first three receipts, the bank
labelled the payments as "Partial deposit on sale of TCT No.
138914", while it noted the 4th receipt as "Partial/Full payment
on deposit on sale of A/asset TCT No. 138914."In the
meantime, the PELA members remained in the property and
introduced further improvements. On November 29, 1993, Al-
Amanah, thru Davao Branch Manager Abraham D. Ututalum-Al
Haj, wrote then PELA President Bonifacio Cuizon, Sr. informing
him of the Head Office’s disapproval of PELA’s offer to buy the
said 2,000-square meter lot. Subsequently, Al-Amanah sent
similarly worded letters, all dated December 14, 1993, to
19PELA members demanding that they vacate the lot. In a
letter dated December 20, 1993, PELA, through Atty. Pedro S.
Castillo, replied that it had already reached an agreement with
Al-Amanah regarding the sale of the subject lot based on their
offered price. Dear Mr. Ututalum-Al-Haj, Meanwhile, acting on
Robern’s undated written offer Al-
Amanah issued a Recommendation Sheet dated December 27,
1993 addressed to its Board Operations Committee, indicating
therein that Robern is interested to buy the lot for
P400,000.00; that it has already deposited 20% of the offered
purchase price; that it is buying the lot on "as is" basis; and,
that it is willing to shoulder the relocation of all informal
settlers therein. On December 29, 1993, the Head Office
informed the Davao Branch Manager that the Board
Operations Committee had accepted Robern’s offer. Eight days
later, Robern was informed of the acceptance. Al-Amanah
stressed that it is Robern’s responsibility to eject the occupants
in the subject lot, if any, as well as the payment of the
remaining amount within 15 days; otherwise, the P80,000.00
deposit shall be forfeited. In a letter dated January 13, 1994,
Robern expressed to Al-Amanah its uncertainty on the status of
the subject lot because PELA made a representation with their
office bringing with them copies of official receipts issued by
Al-Amanah. Robern also requested for a definite statement
from the bank on whether the official receipts being
brandished by PELA are genuine or not. To convince Robern
that it has no existing contract with PELA, Al-Amanah furnished
the demand letters to vacate, and the proof of consignment of
PELA’s P150,000.00 deposit to the RTC of Davao City that PELA
refused to withdraw.
Thereafter, on February 2, 1994, it informed Robern that
should the latter fail to pay the balance by February 9, 1994, its
P80,000.00 deposit will be forfeited and the lot shall be up for
sale to other prospective buyers. Meanwhile, Al-Amanah
requested for assistance for the removal of the houses not only
from the Office of the City Engineer but also from Mayor
Rodrigo Duterte. On March 4, 1994, Robern paid the balance of
the purchase price.
The Deed of Sale over the realty was executed and TCT No. T-
21298 was issued in Robern’s name the following day. A week
later, PELA consigned P150,000.00 in the RTC of Davao City.
Then on April 14, 1994,it wrote Al-Amanah asking the latter to
withdraw the amount consigned. Three months later, as its
members were already facing eviction and possible demolition
of their houses, and in order to protect their rights as vendees,
PELA filed a suit for Annulment and Cancellation of Void Deed
of Sale against Al-Amanah, its Director Engr. Farouk Carpizo
(Engr. Carpizo), OIC Dalig, Robern, and Robern’s President and
General Manager, petitioner Rodolfo Bernardo
(Bernardo)before the RTC of Davao City. It insisted that as early
as March 1993 it has a perfected contract of sale with Al-
Amanah. However, in an apparent act of bad faith and in
cahoots with Robern, Al-Amanah proceeded with the sale of
the lot despite the prior sale to PELA. Incidentally, the trial
court granted PELA’s prayer for a TRO. The RTC’s grant of
injunctive relief was affirmed by the CA when the factual and
legal bases for its issuance were questioned before the
appellate court. The respondents in the annulment case filed
their respective Answers.
Al-Amanah and Engr. Carpizo claimed that the bank has every
right to sell its lot to any interested buyer with the best offer
and thus they chose Robern. They clarified that the
P150,000.00 PELA handed to them is not part of the payment
but merely a deposit in connection with its offer. They asserted
that PELA was properly apprised that its offer to buy was
subject to the approval of Al-
Amanah’s Head Office. They stressed that Al- Amanah never
entered into a sale with PELA for there was no perfected
agreement as to the price since the Head Office rejected. In its
August 10, 1999 Decision, the RTC dismissed PELA’s Complaint.
It opined that the March 18, 1993 letter PELA has been relying
upon as proof of a perfected contract of sale was a mere offer
which was already rejected. Furthermore, the annotation
appearing in the bottom part of the said letter could not be
construed as an acceptance because the same is a mere
acknowledgment of receipt of the letter (not the offer) which
will still be subject to processing. The RTC likewise ruled that
being a corporation, only Al-Amanah’s board of directors can
bind the bank with third persons involving the sale of its
property. Thus, the purported offer made by Al-Amanah’s
OIC, who was never conferred authority by the board of
directors to sell the lot, cannot bind the bank. In contrast,
when the Head Office accepted Robern’s offered price, it was
duly approved by the board of directors, giving birth to a
perfected contract of sale between Al-Amanah and Robern.
On appeal, CA reversed the trial court’s decision. It ruled that
there was already a perfected contract of sale between PELA
and Al-Amanah. It held that the annotation on the lower
portion of the March 18, 1993 letter could be construed to
mean that for Al-Amanah to accept PELA’s offer, the sum of
P150,000.00 must be first put up receipt by Al-Amanah of the
amounts totaling P150,000.00, and the annotation of "deposit
on sale of TCT No. 138914," on the receipts it issued explicitly
indicated an acceptance of the association’s offer to buy.
Consequently, the CA invalidated the sale between Robern and
Al-Amanah Robern and Bernardo filed a Motion for
Reconsideration which Al-Amanah adopted. The CA, however,
was firm in its disposition and thus denied the same.
Aggrieved, Robern and Al-Amanah separately filed Petitions for
Review on Certiorari before us. However, Al-
Amanah’s was denied on procedural grounds.
Al-Amanah’s Motion for Reconsideration of the said
Resolution of dismissal was denied with finality.
Hence, only the Petition of Robern and Bernardo subsists.
ISSUE:
whether there was a perfected contract of sale between PELA
and Al-Amanah, the resolution of which will decide whether
the sale of the lot to Robern should be sustained or not.
HELD:
No, there is no perfected contract of sale between PELA and Al-
Amanah. A 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.
Thus, for a contract of sale to be valid, all of the following
essential elements must concur: "a) consent or meeting of the
minds; b) determinate subject matter; and c) price certain
in money or its equivalent."
In the case at bench, there is no controversy anent the
determinate subject matter, i.e., the 2,000-square meter lot.
This leaves us to resolve whether there was a concurrence of
the remaining elements. As for the price, fixing it can never
be left to the decision of only one of the contracting parties.
"But a price fixed by one of the contracting parties, if accepted
by the other, gives rise to a perfected sale."
As regards consent, "when there is merely an offer by one par
ty without acceptance of theother, there is no contract."
The decision to accept a bidder’s proposal must be
communicated to the bidder.
However, a binding contract may exist between the parties
whose minds have met, although they did not affix their
signatures to any written document, as acceptance may be
expressed or implied. It "can be inferred from the
contemporaneous and subsequent acts of the contracting
parties."
Thus, we held:x x x The rule is that except where a formal
acceptance is so required, although the acceptance must be
affirmatively and clearly made and must be evidenced by some
acts or conduct communicated to the offeror, it may be made
either in a formal or an informal manner, and may be shown by
acts, conduct, or words of the accepting party that clearly
manifest a present intention or determination to accept the
offer to buy or sell. Thus, acceptance may be shown by the
acts, conduct, or words of a party recognizing the existence of
the contract of sale.
There is no perfected contract of sale between PELA and Al-
Amanah for want of consent and agreement on the price.
When PELA Secretary Florida Ramos (Ramos) testified, she
referred to the March 18, 1993letter which PELA sent to Al-
Amanah as the document supposedly embodying the perfected
contract of sale.
However, we find that the March 18, 1993 letter referred to
was merely an offer to buy. Neither can the note written by the
bank that "subject offer has been acknowledged/received but
processing to take effect upon putting up of the partial amount
of P150,000.00 on or before April 15, 1993" be construed as
acceptance of PELA’s offer to buy. Taken at face value, the
annotation simply means that the bank merely acknowledged
receipt of PELA’s letter offer. Furthermore, by ‘processing,’ Al-
Amanah only meant that it will ‘act on the offer’, i.e., it still has
to evaluate whether PELA’s offer is acceptable. Until and unless
Al-Amanah accepts, there is as yet no perfected contract of
sale. Notably here, the bank never signified its ‘approval’ or
‘acceptance’ of the offer.
We cannot agree with the CA’s ratiocination that receipt of the
amount, coupled with the phrase written on the four receipts
as "deposit on sale of TCT No. 138914," signified a tacit
acceptance by Al-Amanah of PELA’s offer.
For sure, the money PELA gave was not in the concept of an ea
rnest money. Besides, as testified to by then OIC Dalig, it is the
usual practice of Al-Amanah to require submission of a bid
deposit which is acknowledged by way of bank receipts before
it entertains offers.I t is thus undisputed, and PELA even
acknowledges, that OIC Dalig made it clear that the acceptance
of the offer, notwithstanding the deposit, is subject to the
approval of the Head Office. Recognizing the corporate nature
of the bank and that the power to sell its real properties is
lodged in the higher authorities, she never falsely represented
to the bidders that she has authority to sell the bank’s
property. And regardless of PELA’s insistence that she execute
a written agreement of the sale, she refused and told PELA to
wait for the decision of the Head Office, making it clear that
she has no authority to execute any deed of sale. Contracts
undergo three stages: "a) negotiation which begins from the
time the prospective contracting parties indicate interest in the
contract and ends at the moment of their agreement[;
b)perfection or birth, x x x which takes place when the parties
agree upon all the essential elements of the contract x x x; and
c) consummation, which occurs when the parties fulfill or
perform the terms agreed upon, culminating in the
extinguishment thereof."
In the case at bench, the transaction between Al-Amanah and
PELA remained in the negotiation stage. The offer never
materialized into a perfected sale, for no oral or documentary
evidence categorically proves that Al-Amanah expressed
amenability to the offered P300,000.00 purchase price. Before
the lapse of the 1-year period PELA had set to pay the
remaining ‘balance,’ Al-Amanah expressly rejected its offered
purchase price, although it took the latter around seven
months to inform the former and this entitled PELA to award of
damages.
Al-Amanah’s act of selling the lot to another buyer is the final
nail in the coffin of the negotiation with PELA. Clearly, there is
no double sale, thus, we find no reason to disturb the
consummated sale between Al-Amanah and Robern.

J.L.T.AGRO,INC.v.BALANSAGFacts
: Don Julian L. Teves (Don Julian) contracted two marriages, first with Antonia
Baena (Antonia), and after her death, with Milagros Donio Teves
(Milagros Donio). Don Julian had two children with Antonia,
namely: JosefaTeves Escaño (Josefa) and Emilio Teves (Emilio). He had also
four (4) children with Milagros Donio, namely: MariaEvelyn Donio Teves (Maria
Evelyn), Jose Catalino Donio Teves (Jose Catalino), Milagros Reyes Teves
(MilagrosReyes) and Pedro Reyes Teves (Pedro).The present controversy
involves a parcel of land known as Lot No. 63 of the Bais Cadastre, which was
originallyregistered in the name of the conjugal partnership of
Don Julian and Antonia. When Antonia died, the land
wasamong the properties involved in an action for partition
and damages. Thereafter, the parties to the case enteredinto a
Compromise Agreement which embodied the partition of all the properties of
Don Julian. The property was toremain undivided during the lifetime
of Don Julian. The Compromise Agreement lays down the
effect of theeventual death of Don Julian that in the
event of death of Julian L. Teves, the properties now
selected andadjudicated to Don Julian shall exclusively be adjudicated to
the wife in second marriage of Don Julian and his four minor children.On 16
November 1972, Don Julian, Emilio and Josefa executed a Deed of Assignment
of Assets with Assumptionof Liabilities in favor of J.L.T. Agro, Inc.
Less than a year later, Don Julian, Josefa and Emilio also
executed
aninstrument entitled Supplemental to the Deed of A
ssignment of Assets with the Supplemental Deed. Thi
sinstrument transferred ownership over Lot No. 63 in favor of J.L.T. Agro, Inc.
Don Julian died intestate.Meanwhile, Milagros Donio and her
children had immediately taken possession over the subject lot
after theexecution of the Compromise Agreement. In 1974,
they entered into a yearly lease agreement with
spouses Antonio Balansag and Hilaria Cadayday. At the
Register of Deeds while trying to register the deed of absolute
sale,respondents discovered that the lot was already titled in the name of
petitioner.
Issue
: Whether Don Julian had validly transferred ownership of the subject lot during
his lifetime? Yes.
Held
: Evidently, at the time of the execution of the deed of
assignment covering Lot No. 63 in favor of petitioner,Don Julian
remained the owner of the property since ownership over the
subject lot would only pass to his heirsfrom the second
marriage at the time of his death. Thus, as the owner of the
subject lot, Don Julian retained theabsolute right to dispose of it during
his lifetime. His right cannot be challenged by Milagros Donio and her
childrenon the ground that it had already been adjudicated to them by virtue of
the compromise agreement.The adjudication in favor of the heirs of Don Julian
from the second marriage became automatically operative uponthe
approval of the Compromise Agreement, thereby vesting on
them the right to validly dispose of Lot No. 63 infavor of
respondents. All things which are not outside the commerce of
men, including future things, may be theobject of a contract. All rights
which are not intransmissible may also be the object of contracts. No contract
may beentered into upon future inheritance except in cases expressly
authorized by law. Well-entrenched is the rule thatall things, even future
ones, which are not outside the commerce of man may be the
object of a contract. Theexception is that no contract may be
entered into with respect to future inheritance, and the
exception to theexception is the partition inter vivos referred to in Article
1080. The first paragraph of Article 1080, which providesthe exception to the
exception and therefore aligns with the general rule on future things,
reads: ART. 1080. Should a person make a partition of his estate
by an act inter vivos, or by will, such partition shall berespected,
insofar as it does not prejudice the legitime of the compulsory heirs.. . . .The
partition inter vivos of the properties of Don Julian is
undoubtedly valid pursuant to Article 1347. However,considering
that it would become legally operative only upon the death of Don Julian, the
right of his heirs from thesecond marriage to the properties
adjudicated to him under
the compromise agreement was
but a mereexpectancy. It was a bare hope of
succession to the property of their father. Being the
prospect of a futureacquisition, the interest by its nature
was inchoate. It had no attribute of property, and the interest
to which itrelated was at the time nonexistent and might never exist.
STARBRIGHT SALES ENTERPRISES, INC., PETITIONER,
VS. PHILIPPINE REALTY CORPORATION, MSGR. DOMINGO
A.CIRILOS, TROPICANA PROPERTIES AND DEVELOPMENT
CORPORATION AND STANDARD REALTY
CORPORATION,RESPONDENTS.
[G.R. No. 177936, January 18, 2012]
ABAD, J.:Facts:On April 17, 1988 Ramon Licup wrote Msgr.
Domingo A. Cirilos, offering to buy three contiguous parcels of
land inParañaque that The Holy See and Philippine Realty
Corporation (PRC) owned for P1,240.00 per square meter.
Licupaccepted the responsibility for removing the illegal
settlers on the land and enclosed a check for P100,000.00 to
"close the transaction.” He undertook to pay
the balance of the purchase price upon presentation of the title
fortransfer and once the property has been cleared of its
occupants. Msgr. Cirilos, representing The Holy See and
PRC,signed his name on the conforme portion of the letter and
accepted the check. But the check could not beencashed due
to Licup's stop-order payment. Licup wrote Msgr. Cirilos on
April 26, 1988, requesting that the titlesto the land be instead
transferred to petitioner Starbright Sales Enterprises, Inc.
(SSE). He enclosed a new checkfor the same amount. SSE's
representatives, Mr. and Mrs. Cu, did not sign the letter.On
November 29, 1988 Msgr. Cirilos wrote SSE, requesting it to
remove the occupants on the property and, shouldit decide not
to do this, Msgr. Cirilos would return to it the P100,000.00 that
he received. On January 24, 1989 SSE
replied with an "updated proposal.” It would be willing to
comply with Msgr. Cirilos' condition provided the
purchase price is lowered to P1,150.00 per square meter.On
January 26, 1989 Msgr. Cirilos wrote back, rejecting the
"updated proposal." He said that other buyers werewilling to
acquire the property on an "as is, where is" basis at P1,400.00
per square meter. He gave SSE seven dayswithin which to buy
the property at P1,400.00 per square meter, otherwise, Msgr.
Cirilos would take it that SSE haslost interest in the same. He
enclosed a check for P100,000.00 in his letter as refund of what
he earlier received.The property was eventually sold to
Tropicana Properties and then sold Standard Realty.
Issue:Whether or not there is a perfected contract existing
between SSE and land owners, represented by Msgr. Cirilos.
Ruling: Three elements are needed to create a perfected
contract: 1) the consent of the contracting parties; (2) an
objectcertain which is the subject matter of the contract; and
(3) the cause of the obligation which is established. Underthe
law on sales, a contract of sale is perfected when the seller,
obligates himself, for a price certain, to deliver andto transfer
ownership of a thing or right to the buyer, over which the latter
agrees. From that moment, the partiesmay demand reciprocal
performance.The Court believes that the letter between Licup
and Msgr. Cirilos, the representative of the property's
owners,constituted a perfected contract. However, when Licup
ordered to stop his deposit and instead transferred
theproperty to SSE, a novation took place. Novation serves two
functions - one is to extinguish an existing obligation,the other
to substitute a new one in its place - requiring concurrence of
four requisites: 1) a previous validobligation; 2) an agreement
of all parties concerned to a new contract; 3) the
extinguishment of the old obligation;and 4) the birth of a valid
new obligation. In the given case, it was noted that the
signatures present during Licupand Msgr. Cirilos agreement are
not present in the letter of agreement between SSE and Msgr.
Cirilos. SSE cannotrevert to the original terms stated in Licup's
letter to Msgr. Cirilos since it was not privy to such
contract. Theparties to it were Licup and Msgr. Cirilos. Under
the principle of relativity of contracts, contracts can only bind
theparties who entered into it.

Mendezona v. Ozamis G.R. No. 43370. February6, 2002

Facts: Petitioners are relatives of Carmen Ozamis withwhom they entered into
a Contract of Sale, for consideration, over 3 parcels of land in Lahug, CebuCity.
They filed an action to quiet title of a cloud over their properties by reason an
inscription of notice of lis pendens caused by the guardians appointed for
CarmenOzamiz through guardianship proceedings (Sp. Proc. No. 1250).
Respondents opposed the petitioners¶ claimof ownership of the
Lahug property and alleged thatthe titles issued in the petitioners names are
defectiveand illegal, and the ownership of the said property wasacquired in bad
faith and without value inasmuch asthe consideration for the sale is grossly
inadequate andunconscionable. The trial court found the sale valid,and such
decision was appealed to the CA whoreversed the former.Petitioners filed a
motion for reconsideration of thedecision of the appellate court. Subsequent
thereto, the petitioners filed a motion for a new trial and/or for reception of
evidence. They contended, among other things, that the appellate
court totally ignored
thetestimony of Judge Teodorico Durias regarding themental
condition of Carmen Ozamiz a month beforethe execution of the Deed of
Absolute Sale in question,which testimony was taken in the Sp. Proc. No.
1250.However, Judge Durias was not presented as a witnessin the action to
quiet title. Petitioners alleged thatJudge Durias¶s testimony is a newly-
discoveredevidence which could not have been discovered prior to the trial in
the court below by the exercise of duediligence.Issue: WON the testimony of
Judge Durias is a newly-discovered evidence.Held: No, it is not a newly-
discovered evidence. Amotion for new trial upon the ground of
newlydiscovered evidence is properly granted only wherethere is concurrence
of the following requisites,namely:(a) the evidence had been discovered after
trial;(b) the evidence could not have been discoveredand produced during trial
even with the exercise of reasonable diligence; and(c) the evidence is material
and not merelycorroborative, cumulative or impeaching and is of suchweight
that if admitted, would probably alter the result.All three (3) requisites must
characterize theevidence sought to be introduced at the new trial. Wefind that
the requirement of reasonable diligence hasnot been met by the petitioners.
As early as the pre-trialof the case at bar, the name of Judge Durias hasalready
cropped up as a possible witness for thedefendants, herein
respondents. That the respondentschose not to present him is not an indicia
per se
of suppression of evidence, since a party in a civil case isfree to choose who to
present as his witness. Neither can Judge Durias¶ testimony in another case
beconsidered as newly discovered evidence since thefacts to be testified to by
Judge Durias which wereexisting before and during the trial, could have
been presented by the petitioners at the trial below.
Thetestimony of Judge Durias has been in existencewaiting only to be elicited
from him by questioning. Ithas been held that a lack of diligence is
exhibitedwhere the newly discovered evidence was necessary or proper
under the pleadings, and its existence must haveoccurred to the party in the
course of the preparation of the case, but no effort was made to secure it. Thus,
thetestimony of Judge Durias cannot be considered asnewly discovered
evidence to warrant a new trial