Leal vs. IAC

 

10. Leal vs. IAC GR No. L-65425 (Nov 5, 1987) Facts:

On March 21, 1941, a document entitled “compraventa”, written entirely in Spanish, was entered into between Vicente and Luis Santiago and Cirilio Leal, involvi involving ng three parcels of land. Therein was contained the phrase (orig in Spanish) “they shall not sell to others these three lots but only to the seller Vicente Santiago or to his heirs or successors,” referring to Cirilio Leal’s heirs. When Cirilio died in 1959, his children inherited the subject lands, which they then either mortgaged or leased. Vicente Santiago approached the Leals and offered to repurchase the properties, but was refused. His complaint for speciic performance was dismissed by both the trial court and the IAC, there being no sale or alienation equivalent to a sale yet. Later on, however, the IAC reversed its decision, ordering the Leals to accept the offer of repurchase. Issue: Whether the clause gives Santiago a right of repurchase. Held:

Provisions that restrict the right of ownership, indeinite Provisions as to time, are null as being against public order, under Art 1255 of the Civil Code of Spain and Art 1306 of the Civil Code of the Philippines. Even assuming the validity of the provisio provision, n, the law requires the vendor to reserve his right to repurchase the thing sold in no uncertain terms, in order for a conventional conventio nal redemption to take place. There was no such reservation, express or implied, in the compraventa. Furthermore, the phrase “en caso de venta” should be Furthermore, construed to mean “should the buyers wish to sell” and not “the buyers buyers should should sell”, in which which case, Art 1508 1508 of the Civil code of Spain (Art 1606 of the Civil Code of the Philippines), applies, wherein is stated that the right to redeem of repurchase in in the absence absence of an agreement agreement as to time, shall last four years from the date of the contract. Repurchase under this should have been done in 1945. Assuming again that the phrase “siempre y cuando estos ultimos puden hacer de compra” (when the buyer has money to buy) can be construed to be an agreement as to time, the second paragraph of the same Articles provide that the right should exercise within ten years because the law does not favour suspended ownership. In this second case, Santiago’s right to repurchase has already expired, 1966 being 25 years from the date of contract.