07 Catungal v Rodriguez

Catungal v. Rodriguez G.R. No. 146839, March 23, 2011 Leonardo-De Castro, J.: FACTS: Agapita Catungal owned a parcel of land with an area of 65, 246 square meters in Talamban, Cebu City. She entered into a Contract to Sell with Angel Rodriguez. Subsequently, the Contract to Sell was upgraded into a Conditional Deed of Sale between the same parties. Rodriguez secured the necessary survey and plans that reclassified the land from agricultural to residential and actively negotiated for the road right of way. The spouses Catungal requested an advance of P5,000,000.00 on the purchase price. Rodriguez objected on the unwarranted demands in view of the terms of the Conditional Deed of Sale that allowed him sufficient time to negotiate a road right of way and exclusive right to rescind the contract. Thereafter, he received a letter from Atty. Catungal that the contract is cancelled and terminated. Catungal filed a complaint contending that the Catungal’s unilateral rescission of the Conditional Deed of Sale was unjustified, arbitrary and unwarranted. However, the Catungals claims that Rodriguez does not have an exclusive right to rescind the contract it being recorocal. The trial court ruled in favor of Rodriguez. The Catungals appealed the decision to the Court of Appeals. In a Motion for Reconsideration, Atty. Borromeo, a new counsel for the Catungals, argued for the first time that the paragraphs 1(b) and 5(49) of the Conditional Deed of Sale violated the principle of mutuality under Article 1308 of the Civil Code. ISSUE 1. Whether petitioners allowed to raise their theory of nullity of the Conditional Deed of Sale for the first time on appeal? 2. Whether paragraphs 1(b) and 5 of the Conditional Deed of Sale violate the principle of mutuality of contracts under Article 1308? HELD 1. No. The Court held that a situation where a party completely changes his theory of the case on appeal and abandons his previous assignment of errors in his brief, which plainly should not be allowed as anathema to due process. During the proceedings before the trial court, the spouses Catungal never claimed that the provisions in the Conditional Deed of Sale, stipulating that the payment of the balance of the purchase price was contingent upon the successful negotiation of a road right of way and granting Rodriguez the option to rescind, were void for allegedly making the fulfillment of the contract dependent solely on the will of Rodriguez. 2. No. The Court held that in the Conditional Deed of Sale the respondent shall pay the balance of the purchase price when he has successfully negotiated and secured a road right of way, is not purely potestative as what the petitioners contend. It is not dependent on the sole will of the debtor but also on the will of third persons who own the adjacent land and from whom the road right of way shall be negotiated. This mixed condition is expressly allowed under Article 1182 of the Civil Code. In other words, the obligation to pay the balance is conditioned upon the acquisition of the road right-of-way, in accordance with paragraph 2 of Article 1181 of the New Civil Code. In the event that the condition is not fulfilled, Rodriguez

can either proceed with the sale and demand return of his downpayment or to waive the condition and still pay the purchase price despite the lack of road access.