Dela Cruz vs Legaspi

TOPIC: Obligations of the Vendee EUSEBIO DE LA CRUZ v. APOLONIO LEGASPI G.R. No. L-8024, Nov. 29, 1955 PONENTE: Bengzon, J. FACTS: Plaintiff-appellee Eusebio de la Cruz sued herein defendant- appellant Apolonio Legaspi and his wife to compel the delivery of a parcel of land the latter sold to De la Cruz in December, 1949. It was alleged in the complaint an execution of a contract, the terms thereof, the refusal of defendants to accept payment of the purchase price of P450 which De la Cruz had tendered, and the undue retention of the land. In their answer, spouses Legaspi admitted the sale and the price. However, they claimed that before the document of sale was made, De la Cruz agreed to pay them purchase price right after the document is executed on December 5, 1949. But after the signing and ratification of the document by the Notary Public and after De la Cruz took the original document, he refused to pay the P450. For lack of consideration and for deceit, they argued that the document should be annulled. De la Cruz in turn claimed that spouses Legaspi's allegation gave no excuse for them to retain the property, rejecting the price. The trial court rendered judgment ordering De la Cruz to pay the P450 and the spouses Legaspi to receive such and to deliver possession of the property to him after such payment. Spouses Legaspi filed a motion for reconsideration but the same failed. Hence, this appeal. ISSUE: Whether or not the contract of sale is void for lack of consideration. RULING: No. The Court stressed that it cannot be denied that when the document was signed, the cause or consideration existed: P450. The document specifically said so; and such was undoubtedly the agreement. Subsequent non-payment of the price at the time agreed upon did not convert the contract into one without cause or consideration: a nudum pactum. In the case at bar, the situation was rather one in which there is failure to pay the consideration, with its resultant consequences. As such, when after the notarization of the contract, De la Cruz failed to hand the money to spouses Legaspi as he previously promised. There was default on his part at most, and the spouses Legaspi has the right to demand interest (legal interest) for the delay, pursuant to article 1501 (3) of the Civil Code, or to demand rescission in court. However, said failure did not resolve the contract since no stipulation to that effect was alleged. There was neither any agreement nor allegation that payment on time was essential. Moreover, even if the contract of sale herein question had expressly provided for "automatic rescission upon failure to pay the price," the trial judge could allow De la Cruz to enforce the contract in effect because spouses Legaspi did not make a previous demand on him for payment of the purchase price through a suit or notarial act. As provided for by Article 1504 of the Civil Code, “in the sale of real property, even though it may have been stipulated that in default of the price within the time agreed upon, the resolution of the contract shall take place ipso facto, the vendee may pay even after the expiration of the period, at any time before demand has been made upon him either by suit or by notarial act. After such demand has been made the judge cannot grant him further time. It was noted by the Court that the demand referred to by the law is a demand for rescission. From the foregoing, the Court affirmed the judgment of the trial court.