Sales

PRICE: In money or its equivalent G.R. No. 134559 December 9, 1999 ANTONIA TORRES assisted by her husband, ANGELO TORRES; and EMETERIA BARING, petitioners, vs. COURT OF APPEALS and MANUEL TORRES, respondents. FACTS: Sisters Antonia Torres and Emeteria Baring, herein petitioners, entered into a "Joint Venture Agreement" with Respondent Manuel Torres for the development of a parcel of land into a subdivision. Pursuant to the contract, they executed a Deed of Sale covering the said parcel of land in favor of respondent, who then had it registered in his name. By mortgaging the property, respondent obtained from Equitable Bank a loan of P40,000 which, under the Joint Venture Agreement, was to be used for the development of the subdivision. All three of them also agreed to share the proceeds from the sale of the subdivided lots. The project did not push through, and the land was subsequently foreclosed by the bank. According to petitioners, the project failed because of "respondent's lack of funds or means and skills." They add that respondent used the loan not for the development of the subdivision, but in furtherance of his own company, Universal Umbrella Company. On the other hand, respondent alleged that he used the loan to implement the Agreement. With the said amount, he was able to effect the survey and the subdivision of the lots. Respondent claimed that the subdivision project failed, however, because petitioners and their relatives had separately caused the annotations of adverse claims on the title to the land, which eventually scared away prospective buyers. They filed the present civil case which, upon respondent's motion, was later dismissed by the trial court. On appeal, however, the appellate court remanded the case for further proceedings. Thereafter, the RTC issued its assailed Decision, which, as earlier stated, was affirmed by the CA. Hence, this Petition. CONTENTION OF PETITIONERS: Petitioners contend that the Joint Venture Agreement is void under Article 1422 of the Civil Code, because it is the direct result of an earlier illegal contract, which was for the sale of the land without valid consideration. ISSUE: Whether or not the contract of sale between the parties which was the basis for the Joint Venture Agreement is void for lack of a valid consideration. HELD: This argument is puerile. The Joint Venture Agreement clearly states that the consideration for the sale was the expectation of

profits from the subdivision project. Its first stipulation states that petitioners did not actually receive payment for the parcel of land sold to respondent. Consideration, more properly denominated as cause, can take different forms, such as the prestation or promise of a thing or service by another. In this case, the cause of the contract of sale consisted not in the stated peso value of the land, but in the expectation of profits from the subdivision project, for which the land was intended to be used. As explained by the trial court, "the land was in effect given to the partnership as [petitioner's] participation therein. . . . There was therefore a consideration for the sale, the [petitioners] acting in the expectation that, should the venture come into fruition, they [would] get sixty percent of the net profits." _____________________________________________________ G.R. No. L-11908

February 4, 1918

ANTONIO M.A BARRETTO, plaintiff-appellant, vs. JOSE SANTA MARINA and "LA INSULAR," defendantsappellees. Alfredo Chcote and Jose Arnaiz for appellant. William A. Kincaid and Kincaid and Perkins for appellee. CARSON, J.: The material facts upon which our disposition of this appeal necessarily turns are set out at length in our opinion in the case of Barretto vs. Santa Marina, decided December 2, 1913 (26 Phil rep., 200). This court having ruled against the plaintiff's contention in the former case, he now sets up a claim for interest at the legal rate upon the amount of the purchase price of his share (participacion) in the business from the 1st day of July, 1909, to the 22d day of November, 1910, the day upon which it was turned over to him. The finding of facts, and the reasoning upon which we based our rulings in the former case, are manifestly conclusive in the present case as to the plaintiff's claim of a right to interest from the first of July, 1909, to the third of May, 1910. In the former case we held that the sale of plaintiff's share (participacion) in the tobacco factory was consummated on the latter date; that the valuation set upon his share (participacion) in business was determined as of that day by the committee charged with the duty of ascertaining the cash value of this share (participacion) in order to determine the exact amount which the parties had agreed upon as the purchase price to be paid therefor; and that the committee had included that the plaintiff's share of the profits of the business down to the third of May, 1910, in their estimate of the value of his share (participacion) in the business of that date. These rulings were made after a review of the same record which is now relied upon by the plaintiff in support of his claim of interest upon the amount fixed by the committee as the true value of his share (participacion) in the business. We find nothing in the record

of the contention of counsel in this regard which would justify or necessitate a modification or reversal of the conclusions reached by us in our former opinion.

2. By reference to invoices

Plaintiff's share (participacion) in the business having been sold on the 3rd day of May, 1910, for a stipulated price, that is to say, for its value on that day as fixed by the valuation committee, it is very clear that he is not entitled to interest on the amount fixed by the committee, prior to the date on which the sale was consummated (3rd of may, 1910).

E. C. MCCULLOUGH, plaintiff-appellee, vs. R. AENLLE & CO., defendants-appellants.

So also plaintiff's contention that he should be allowed interest on the amount of the purchase price from the date of the sale, May 3, 1910, down to the day upon which the money was actually turned over to him, November 22, 1910, cannot be sustained. Under the express terms of the agreement for the sale on May 3, 1910, the plaintiff agreed to accept, and the defendant to pay, the amount which the committee should find to be the true value of plaintiff's share (participacion) in the business as of that day. Under the agreement the defendant neither expressly nor impliedly obligated himself to pay interest on that amount pending the report of the committee. The only contractual obligation assumed by him was that he would pay the amount fixed by the committee in cash immediately upon the making of the award by the committee, and in accordance with its terms. The committee's report is dated November 14, 1910, and it appears that promptly upon the submission of this report, the amount awarded the plaintiff (P280,025.16) was paid over by the defendant to the plaintiff in cash; and the letter of counsel for plaintiff dated November 17, 1910, tendering a formal deed of sale of plaintiff's share (participacion) in the business and making demand for the purchase price as fixed by the committee, read together with the formal deed of sale executed November 22, 1910, with its acknowledgment of the receipt of the purchase price, leaves no room for doubt that at that time the parties understood and accepted the purchase price therein set forth as full payment of plaintiff's share (participacion) in the business in exact conformity with the conditions imposed in the agreement consummated to May 3, 1910. The right to interest arises either by virtue of a contract or by way of damages for delay or failure (demora) to pay the principal on which interest is demanded, at the time when the debtor is obligated to make such payment. In the case at bar where was no contract, express or implied, for the payment of interest pending the award of the committee appointed to value the property sold on May 3, 1910, and there was no delay in the punctual compliance with defendant's obligation to make immediate payment, in cash, of the amount of the award, upon the filing of the report of the committee. We conclude that the judgment entered in the court below dismissing the complaint in this case sine die should be affirmed, with the costs of this instance against the appellant. So ordered. Arellano, C.J., Torres, Johnson, Street, Malcolm and Avanceña, JJ., concur. Araullo J., took no part.

G.R. No. 1300

February 3, 1904

FACTS: The parties entered into a Contract of Sale whereby the defendant R. Aenlle & Co. sold to plaintiff McCullough the tobacco factory it owned. In the Contract of August 27, the defendant undertook to sell to the plaintiff the tobacco and cigarette factory known as "La Maria Cristina," including the trade-mark "La Maria Cristina," the stock of tobacco in leaf and manufacture, machinery, labels, wrappers, furniture, fixtures, and everything else belonging to the said factory. An inventory was drawn denominating the price of the articles to be sold including the trademark. As stipulated in the contract, the value of the tobacco will be fixed at the invoice price as shown in the price list of the inventory. The parties executed a second instrument, which in addition to a recital of substance of the contract of August 27, stipulated the total price which the vendee will pay to the vendor with regards to the sale of the factory including the machineries and tobacco therein and the manner of payment. Subsequently, they executed a third contract, in which the defendant acknowledged the receipt at that time of the full purchase price of the sale The plaintiff, with others, organized a company, to which the plaintiff sold all the tobacco bought by him from the defendant. The purchaser, the new company, on examining these two lots, rejected them because the tobacco was not of the quality indicated in the inventory. Thereupon the plaintiff, claiming that the tobacco in these two lots was worthless, brought this action against the defendant to recover what he paid therefor. It was proved by the defendant at the trial, by means of the original invoices, that the prices stated in the inventory were the prices which it paid for the tobacco, and the plaintiff makes no claim to the contrary. ISSUE: Whether or not the August 27 contract of sale was a completed contract. HELD: The document of August 27 was a completed contract of sale. (Art. 1450, Civil Code.) The articles which were the subject of the sale were definitely and finally agreed upon. The appellee agreed to buy, among other things, all of the leaf tobacco in the factory. This was sufficient description of the thing sold. The price for each article was fixed. It is true that the price of this tobacco, for example, was not stated in dollars and cents

in the contract. But by its terms the appellee agreed to pay therefor the amount named in the invoices then in existence. The price could be made certain by a mere reference to those invoices. In this respect the contract is covered by article 1447 of the Civil Code. By the instrument of August 27 the contract was perfected and thereafter each party could compel the other to fulfill it. (Art. 1258, Civil Code.) By its terms the appellee was bound to take all the leaf tobacco then belonging to the factory and to pay therefor the prices named in the invoices. This obligation was absolute and did not depend at all upon the quality of the tobacco or its value. The appellee did not, in this contract, reserve the right to reject the tobacco if it were not of a specific crop. He did not buy tobacco of a particular kind, class, or quality. He bought all the tobacco which the appellant owned and agreed to pay for it what the defendant had paid for it. The plaintiff testified that this was the express agreement (p. 16). There is nothing in this contract to show that he bought 221 bales of fourth-class superior Angadanan of the crop of 1899. The fact that in the inventory subsequently made that particular lot of tobacco is mentioned can not in any respect change the rights of the parties which had already been fixed by the contract. The purpose of this inventory was to make a new contract for the parties. It could not add anything to nor take anything from the rights and obligations of the parties already stated in the existing contract. Its sole purpose was to ascertain what the total purchase price was. If it correctly gave the number of bales and the price paid therefor by the appellant, according to the invoices, it was a sufficient compliance with the contract. The fact that the tobacco was described as of one class instead of another would be unimportant. The appellee did not purchase by class or quality, but by quantity. There was evidence tending to show that the first lot instead of being fourth-class of 1899 was fourth-class inferior of 1898; and the second lot instead of being of the first, second, and third class of 1899 was "particular" of 1898. The case is perhaps made more plain by supposing that when the inventory was presented to the plaintiff these two lots were described as "Y. P. I. fourth-class inferior Angadanan, 1898" and as "Isabela hojas sueltas particular1898." It seems clear that if the inventory had been so written the plaintiff could not have maintained this action. And, of course, if he could not have maintained the action under those circumstances he can not under the existing circumstances. There is no evidence to show that any representations as to the quality of the tobacco were made to the plaintiff by the defendant prior to the contract of August 27, nor that there was any agreement prior to that time as to an exhibition of samples nor that the plaintiff prior to that time made any examination or inquiry as to the quality of the tobacco. The fact is that the plaintiff in order to get the building had to buy the factory and everything that went with it. He saw himself obliged to take all the tobacco which the defendant had, no matter what its quality was. The defendant was not willing to sell him the building and the good tobacco which it had on hand, retaining itself of poorer quality. He had to take it all or not get the building. He probably though that he was safe in agreeing to pay no more than the defendant had paid. But, however this may be and whatever may have been his reasons therefor, it is certain that

the plaintiff bound himself by the contract of August 27 to take all the tobacco which the defendant then had any pay therefor the prices that the company had paid. He could relieve himself from this obligation only by showing either that the tobacco in the inventory was not owned by the defendant on August 27 or that the prices stated therein were not the prices which the defendant paid for it. He undertook to do neither of these things, and his action must fail. The right to rescind a contract for lesion when the value is less than half of the purchase price, given by law, title, partida, has been expressly taken away by article 1293 of the Civil Code. Article 1474 of the Civil Code has no application in this case. The fact that an article is of one grade or quality instead of another does not constitute a hidden defect within the meaning of that article. _____________________________________________________ 2.Effect of indeterminability G.R. No. L-26173

July 13, 1927

ZACARIAS ROBLES, plaintiff-appellee, vs. LIZARRAGA HERMANOS, defendant-appellant. FACTS: The hacienda "Nahalinan," belonged originally to the spouses Zacarias Robles and Anastacia de la Rama. Upon the death of Zacarias Robles, sr., his widow Anastacia de la Rama was appointed administratrix of his estate; she leased the hacienda to the plaintiff, Zacarias Robles, for the period of six years beginning at the end of the milling season in May, 1915, and terminating at the end of the milling season in May, 1920. It was stipulated that any permanent improvements necessary to the cultivation and exploitation of the hacienda should be made at the expense of the lessee without right to indemnity at the end of the term. The plaintiff accordingly entered upon the property, in the character of lessee; and, in order to put the farm in good condition, he found it necessary to make various improvements and additions to the plant. In 1916, or three years before the lease was to expire, Anastacia de la Rama died. Evarista Robles acquired by purchase the shares of their coheirs in the entire inheritance; and at this juncture Lizarraga Hermanos came forward with a proposal to buy from these three all of the other properties belonging to the Robles estate. In course of the negotiations an obstacle was encountered in the fact that the lease of Zacarias Robles still had over two years to run. It was accordingly proposed that he should surrender the last two years of his lease and permit Lizarraga Hermanos to take possession as purchaser in June, 1918. In consideration that the plaintiff should shorten the term of his lease to the extent stated, the defendant agreed to pay him the value of all betterments that he had made on the hacienda and furthermore to purchase from him all that belonged to him personally on the hacienda, including the crop of 1917-18, the cattle, farming implements and equipment, according to a valuation

to be made after the harvest. The plaintiff agreed to this; and the instrument of conveyance by which the three owners, Zacarias, Jose and Evarista Robles, conveyed the property to Lizarraga Hermanos was accordingly executed on November 16, 1917.

ISSUES: 1.

The plaintiff received some thousands of pesos of the purchase money more than his brother and sister. This is explained by the fact that the plaintiff was a creditor of his mother's estate while the other two were debtors to it; and the difference in the amounts paid to each resulted from the adjustments of their respective rights.

2.

No reference is made in this conveyance to the surrender of the plaintiff's rights as lessee, except in fixing the date when the lease should end; nor is anything said concerning the improvements or the property of a personal nature which the plaintiff had placed on the hacienda. The plaintiff says that, when the instrument was presented to him, he saw that in the sixth paragraph it was declared that the plaintiff's lease should subsist only until June 30, 1918, instead of in May, 1920, which was the original term, while at the same time the promise of the defendant to compensate for him for the improvements and to purchase the existing crop, together with the cattle and other things, was wanting. Believing that the agreement with respect to compensation would be carried out in good faith, he did not further insist upon the incorporation of said agreement into this document. Nor was the supposed agreement otherwise reduced to writing.

4.

On the part of the defendant it is claimed that the agreement with respect to compensating the plaintiff for improvements and other things was never in fact made. The plaintiff introduced in evidence a letter (Exhibit D), written on March 1, 1917, by Severiano Lizarraga to the plaintiff, in which reference is made to an appraisal and liquidation. This letter is relied upon by the plaintiff as constituting written evidence of the agreement; but it seems to us so vague that, if it stood alone, and a written contract were really necessary, it could not be taken as sufficient proof of the agreement in question. But we believe that the contract is otherwise proved by oral testimony. When testifying as a witness of the defense Carmelo Lizarraga himself admitted — contrary to the statement of defendant's answer — that a few days before the conveyance was executed the plaintiff proposed that the defendant should buy all the things that the plaintiff then had on the hacienda, whereupon the Lizarragas informed him that they would buy those things if an agreement should be arrived at as to the price. We note that as regards the improvements the position of the defendant is that they pertained to the hacienda at the time the purchase was effected and necessarily passed with it to the defendant. As against the denials of the Lizarraga we have the direct testimony of the plaintiff and his brother Jose to the effect that the agreement was as claimed by the plaintiff; and this is supported by the natural probabilities of the case in connection with a subsequent appraisal of the property, which was rendered futile by the course pursued by the defendants.

3.

5.

Whether or not the trial court erred in admitting oral evidence of a contract different from that expressed in the deed of conveyance executed by the parties. Whether or not the trial court erred in admitting oral evidence as with regards to the sale of movables by plaintiff to defendant. Whether or not the stipulation for appraisal and agreement as to the price was a suspensive condition for the enforceability of the contract. Whether or not the defendant is obligated to indemnify the plaintiff for his outlay in making the improvements. Whether or not the trial court erred in awarding to the plaintiff the sum of P1,142 as compensation for the damage caused by the failure of the defendant to take the existing crop of cane from the hacienda at the proper time.

HELD: Under the first assignment of error, exception is taken to the action of the trial court in admitting oral evidence of a contract different from that expressed in the contract of sale (Exhibit B); and it is insisted that the written contract must be taken as expressing all of the pacts, agreements and stipulations entered into between the parties with respect to the acquisition of the hacienda. The execution of a contract in writing is deemed to supersede all oral negotiations or stipulations concerning its terms and the subjectmatter which preceded the execution of the instrument, in the absence of accident, fraud or mistake of fact (10 R. C. L., p. 1016). But it is recognized that this rule is to be taken with proper qualifications; and all the authorities are agreed that proof is admissible of any collateral, parol agreement that is not inconsistent with the terms of the written contract, though it may relate to the same subject-matter (10 R. C. L., p. 1036). In the case before us the deed of conveyance purports to transfer to the defendant only such interests in certain properties as had come to the conveyors by inheritance. Nothing is said concerning the rights in the hacienda which the plaintiff had acquired by lease or concerning the things that he had placed thereon by way of improvement or had acquired by purchase. The verbal contract which the plaintiff has established in this case is therefore clearly independent of the main contract of conveyance, and evidence of such verbal contract is admissible under the doctrine above stated. The rule that a preliminary or contemporaneous oral agreement is not admissible to vary a written contract appears to have more particular reference to the obligation expressed in the written agreement, and the rule had never been interpreted as being applicable to matters of consideration or inducement. In the case before us the written contract is complete in itself; the oral agreement is also complete in itself, and it is a collateral to the written contract, notwithstanding the fact that it deals with related matters. Under the second assignment of error the appellant directs attention to subsection 4 of article 335 of the Code of Civil Procedure wherein it is declared that a contract for the sale of goods, chattels or things in action, at a price of not less than P100,

shall be unenforceable unless the contract, or some note or memorandum thereof shall be in writing and subscribed by the party charged, or by his agent; and it is insisted that the court erred in admitting proof of a verbal contract over the objection of the defendant's attorney. But it will be noted that the same subsection contains a qualification, which is stated in these words, "unless the buyer accept and receive part of such goods and chattels." In the case before us the trial court found that the personal property, consisting of farming implements and other movables placed on the farm by the plaintiff, have been utilized by the defendant in the cultivation of the hacienda, and that the defendant is benefiting by those things. No effort was made in the court below by the defendant to controvert the proof submitted on this point in behalf of the plaintiff, and no error is assigned in this court to the findings of fact with reference thereto made by the trial judge. It is evident therefore that proof of the oral agreement with respect to the movables was properly received by the trial judge, even over the objection of the defendant's attorney. The appellant's third assignment of error has reference to the alleged suspensive condition annexed to the oral agreement. In this connection it is claimed that the true meaning of the proven verbal agreement is that, in case the parties should fail to agree upon the price, after an appraisal of the property, the agreement would not be binding; in other words, that the stipulation for appraisal and agreement as to the price was a suspensive condition in the contract: and since the parties have never arrived at any agreement on the price (except as to the carabao), it is contended that the obligation of the defendant has never become effective. We are of the opinion that the stipulation with respect to the appraisal of the property did not create a suspensive condition. The true sense of the contract evidently was that the defendant would take over the movables and the improvements at an appraised valuation, and the defendant obligated itself to promote the appraisal in good faith. As the defendant partially frustrated the appraisal, it violated a term of the contract and made itself liable for the true value of the things contracted about, as such value may be established in the usual course of proof. Furthermore, it must occur to any one, as the trial judge pointed out, that an unjust enrichment of the defendant would result from allowing it to appropriate the movables without compensating the plaintiff thereof. The fourth assignment of error is concerned with the improvements. Attention is here directed to the fact that the improvements placed on the hacienda by the plaintiff became a part of the realty and as such passed to the defendant by virtue of the transfer effected by the three owner in the deed of conveyance (Exhibit B.). It is therefore insisted that, the defendant having thus acquired the improvements, the plaintiff should not be permitted to recover their value again from the defendant. This criticism misses the point. There can be no doubt that the defendant acquired the fixed improvements when it acquired the land, but the question is whether the defendant is obligated to indemnify the plaintiff for his outlay in making the improvements. It was upon the consideration of the defendant's promise so to indemnify the plaintiff that the latter agreed to surrender the lease nearly two no doubt as to the validity of the promise made under these circumstances to the plaintiff.

The fifth assignment of error is directed towards the action of the trial court in awarding to the plaintiff the sum of P1,142 as compensation for the damage caused by the failure of the defendant to take the existing crop of cane from the hacienda at the proper time. In this connection it appears that it was only in November, 1917, that the defendant finally notified the plaintiff that he would not take the cane off the plaintiff's hands. Having relied upon the promise of the defendant with respect to this matter, the plaintiff had made no prior arrangements to have the cane ground himself, and he had failed to contract ahead for the necessary laborers to harvest the crop. Due to this lack of hands the milling of the cane was delayed, and things that ought to have been done in December, 1917, were only accomplished in February, 1918. It resulted also that the milling of the cane was not completed until July, 1918. The trial court took judicial notice of the fact that protracted delay in the milling of sugar-cane results in loss; and his Honor estimated the damage to the plaintiff's crop upon this account in the amount above stated. As fortifying his position on this point his Honor quoted extensively in his opinion from scientific treatises on the subject of the sugar industry in this and other countries. That there must have been damage attributable to the cause above stated is manifest; and although the estimate made by the court was based upon what may be considered matter of judicial notice without any specific estimate from farmers, we see no reason to conclude that any injustice was done to the plaintiff in said estimate. Upon the whole we find no reason to modify the conclusions of the trial court upon any point, and the judgement appealed from must be affirmed. It is so ordered, with costs against the appellant. _____________________________________________________ G.R. No. 21943

September 15, 1924

ASKAY, plaintiff-appellant, vs. FERNANDO A. COSALAN, defendant-appellee. FACTS: Askay, an illiterate Igorrote between 70 and 80 years of age, obtained title to the Pet Kel Mineral Claim located in Tublay, Benguet. On November 23, 1914, if we are to accept defendant's Exhibit 1, Askay sold this claim to Cosalan. Nine years later, in 1923, Askay instituted action in the Court of First Instance of Benguet to have the sale of the Pet Kel Mineral Claim adhered null, to secure possession of the mineral claim, and to obtain damages from the defendant. Judgment was rendered dismissing the complaint and absolving the defendant from the same. Plaintiff contends that the sale of the Pet Kel Mineral Claim was accomplished through fraud and deceit on the part of the defendant. One facts exists in plaintiff's favor, and this is the age and ignorance of the plaintiff who could be easily duped by the defendant, a man of greater intelligence. Another fact is the inadequacy of the consideration for the transfer which, according to the conveyance, consisted of P1 and other valuable consideration,

and which, according to the oral testimony, in reality consisted of P107 in cash, a bill fold, one sheet, one cow, and two carabaos. ISSUE: Whether or not inadequacy in the consideration is sufficient ground for the cancellation of a contract. HELD: Gross inadequacy naturally suggests fraud and is some evidence thereof, so that it may be sufficient to show it when taken in connection with other circumstances, such as ignorance or the fact that one of the parties has an advantage over the other. But the fact that the bargain was a hard one, coupled with mere inadequacy of price when both parties are in a position to form an independent judgment concerning the transaction, is not a sufficient ground for the cancellation of a contract. Against the plaintiff and in favor of the defendant, we have the document itself executed in the presence of witnesses and before a notary public and filed with the mining recorder. The notary public, Nicanor Sison, and one of the attesting witnesses, Apolonio Ramos, testified to the effect that in the presence of the plaintiff and the defendant and of the notary public and the subscribing witnesses, the deed of sale was interpreted to the plaintiff and that thereupon he placed his thumb mark on the document. Two finger print experts, Dr. Charles S. Banks and A. Simkus, have declared in depositions that the thumb mark on Exhibit 1 is that of Askay. No less than four other witnesses testified that at various times Askay had admitted to them that he had sold the Pet Kel Mine to Fernando A. Cosalan. Having in mind all of these circumstances, how can the plaintiff expect the courts to nullify the deed of sale on mere suspicion? Having waited nine years from the date when the deed was executed, nine years from the time Fernando A. Cosalan started developing the mine, nine years from the time Askay himself had been deprived of the possession of the mine, and nine years permitting of a third party to obtain a contract of lease from Cosalan, how can this court overlook plaintiff's silent acquiescence in the legal rights of the defendant? On the facts of record, the trial judge could have done nothing less than dismiss the action. We conclude therefore that the complaint was properly dismissed. _____________________________________________________ G.R. No. L-14823 December 9, 1919 HILARIA AGUILAR, plaintiff-appellant, vs. JUAN RUBIATO, defendant-appellant, and MANUEL GONZALEZ VILA, defendant-appellee FACTS: Juan Rubiato was the owner of various parcels of land having a potential value of approximately P26,000. Rubiato was desirous of obtaining a loan of not to exceed P1,000. Being in this state of

mind, two men, Manuel Gonzalez Vila a procurador judicial and one Gregorio Azucena, and possibly another, one Marto Encarnacion, came to the house of Rubiato and there induced him to sign the second page of a power of attorney in favor of Manuel Gonzalez Vila. By reason of the power thus given, Manuel Gonzalez Vila formulated on April 29, 1915 the document by which the lands of Rubiato were sold to Hilaria Aguilar of Manila, for the sum of P800, with right of repurchase within one year, Rubiato to remain in possession of the land as lessee and to pay P120 every three months as lease rent. Hilaria Aguilar never saw the lands in question and did not know, until after she had consulted her attorney, exactly what her rights were. Manuel Gonzalez Vila received from Hilaria Aguilar the P800 mentioned in Exhibit C as the selling price of the land. Whether this money was then passed on to Juan Rubiato is uncertain, although it is undeniable that Hilaria Aguilar has never been paid the money she advanced. The one year mentioned in the pacto de retro having expired without Hilaria Aguilar having received the principal nor any part of the lease rent, she began action against Juan Rubiato and Manuel Gonzalez Vila to consolidate the eight parcels of land in her name. The court found that the power of attorney only authorized Manuel Gonzalez Vila to obtain a loan subject to a mortgage, and not to sell the property. The judgment handed down was to the effect that the plaintiff Hilaria Aguilar recover from the defendant Juan Rubiato the sum of P800 with interest at the rate of 60 per cent per annum from April 29, 1915 until May 1, 1916, and with interest at the rate of 12 per cent per annum from May 1, 1916, until the payment of the principal, with the costs against the defendant. Both parties appealed. ISSUE: Is the contract between Rubiato and Aguilar one of loan with mortgage or one of sale? HELD: The so-called power of attorney might indeed be construed as authorizing Vila to sell the property of Rubiato. And it might indeed be construed under a conception similar to that of the trial court's as a loan guaranteed by a mortgage. But the controlling fact is, that the power of attorney was in reality no power of attorney but a sham document. In addition to the evidence, there is one very cogent reason which impels us to the conclusion that Rubiato is only responsible to the plaintiff for a loan. It is — that the inadequacy of the price which Vila obtained for the eight parcels of land belonging to Rubiato is so great that the minds revolts at it. It is an agreement which a reasonable man would neither directly nor indirectly be likely to enter into or to consent to. To hold that the power of attorney signed by Rubiato authorized Vila to enter into the instant contract of sale would be equivalent to holding, if we may be permitted to use the language of Lord Hardwicke, that "a man in his senses and not under delusion" would dispose of lands worth P26,000 for P1,000, and would pay interest thereon at the rate of 60 per cent per annum. (See 6 R. C. L., 679, 841.)

The members of this court after most particular and cautious consideration, having in view all the facts and all the naturals tendencies of mankind, consider that Rubiato is only responsible to the plaintiff for the loan of P800. The points advanced by defendant-appellant likewise necessitate only brief consideration. While entertaining some doubt as to the justice of requiring Rubiato to pay back the amount of P800, we do not feel authorized in disturbing this finding of the trial court. It may well be that Vila and his partners, acting as middlemen, fabricated the document which Rubiato signed, secured the money from Hilaria Aguilar, and then pocketed the same. Yet as minor details somewhat corroborative of the result reached by the trial court, are the undeniable facts that Rubiato admitted his desire to obtain a loan, that Hilaria Aguilar made such a loan, and that while the testimony of Vila is not overly truthful, in this one respect we do have his forceful statement that the money was paid over to Rubiato. That payment of the sum of P800 was not explicity prayed for in the complaint, does not deprive the court of power to render judgment for this amount, because it is a rule of good pleading that "the demand in the complaint is no part of the statement of the cause of action, and does not give it character. The facts alleged do this, and the plaintiff is entitled to so much relief as they warrant." The only remaining question which merits resolution, on which the plaintiff and defendants flatly disagree, relates to the interest which should be allowed. The trial court, it will be remembered, permitted the plaintiff to recover interest at the rate of 60 per cent per annum from April 29, 1915, when the pacto de retro was formulated, until May 1, 1916, the date when the Usury Law, Act No. 2655, went into effect, and interest at the rate of 12 per cent per annum after that date. It is, of course, true that usury laws, such as that in force in the Philippines, are to be construed prospectively and not retrospectively. As stated in the decision just cited, "The reason is, that if the contract is legal at its inception, it cannot be rendered illegal by any subsequent legislation, for this would be tantamount to the impairment of the obligation for the contract." As we have held that the defendant is under obligation to the plaintiff for a mere loan, as this loan fails to name a lawful rate of interest, and as interest at the rate of 60 per cent per annum is unquestionably exorbitant and usurious under the Usury Law, on and after the date when this law became effective, the defendant would be liable for the legal rate of interest, which is 6 per cent per annum. We would even go further and hold that he would be liable only for such interest prior to the enactment of the Usury Law. This we can do under the sanction of article 1255 of the Civil Code which condemns agreements contrary to morals and public policy. Judgment is affirmed, with the sole modification that the plaintiff shall only recover interest at the rate of 6 per cent per annum on the sum of P800 from April 29, 1915 until paid, without special finding as to costs in this instance.

[G.R. No. 126376. November 20, 2003] SPOUSES BERNARDO BUENAVENTURA and CONSOLACION JOAQUIN, SPOUSES JUANITO EDRA and NORA JOAQUIN, SPOUSES RUFINO VALDOZ and EMMA JOAQUIN, and NATIVIDAD JOAQUIN, petitioners, vs. COURT OF APPEALS, SPOUSES LEONARDO JOAQUIN and FELICIANA LANDRITO, SPOUSES FIDEL JOAQUIN and CONCHITA BERNARDO, SPOUSES TOMAS JOAQUIN and SOLEDAD ALCORAN, SPOUSES ARTEMIO JOAQUIN and SOCORRO ANGELES, SPOUSES ALEXANDER MENDOZA and CLARITA JOAQUIN, SPOUSES TELESFORO CARREON and FELICITAS JOAQUIN, SPOUSES DANILO VALDOZ and FE JOAQUIN, and SPOUSES GAVINO JOAQUIN and LEA ASIS, respondents. FACTS: Defendant spouses Leonardo Joaquin and Feliciana Landrito are the parents of plaintiffs as well as of defendants. Sought to be declared null and void ab initio are certain deeds of sale of real property executed by defendant parents Leonardo Joaquin and Feliciana Landrito in favor of their co-defendant children and the corresponding certificates of title issued in their names. In seeking the declaration of nullity of the aforesaid deeds of sale and certificates of title, plaintiffs, in their complaint, aver: The deeds of sale, Annexes ―C,‖ ―D,‖ ―E,‖ ―F,‖ and ―G,‖ [and ―K‖] are simulated as they are, are NULL AND VOID AB INITIO because – a)

Firstly, there was no actual valid consideration for the deeds of sale xxx over the properties in litis;

b)

Secondly, assuming that there was consideration in the sums reflected in the questioned deeds, the properties are more than three-fold times more valuable than the measly sums appearing therein;

c)

Thirdly, the deeds of sale do not reflect and express the true intent of the parties (vendors and vendees); and

d)

Fourthly, the purported sale of the properties in litis was the result of a deliberate conspiracy designed to unjustly deprive the rest of the compulsory heirs (plaintiffs herein) of their legitime.

After trial, the trial court ruled in favor of the defendants and dismissed the complaint. The Court of Appeals affirmed the decision of the trial court. Hence, this petition. ISSUES: 1.

Whether or not petitioners have a legal interest over the properties subject of the deeds of sale.

2. 3.

Whether or not the deeds of sale are void for lack of consideration. Whether or not the deeds of sale are void for gross inadequacy of the price.

HELD: 1. The Petitioners do not have a legal interest over the properties subject of the Deeds of Sale In their Complaint, petitioners asserted that the ―purported sale of the properties in litis was the result of a deliberate conspiracy designed to unjustly deprive the rest of the compulsory heirs (plaintiffs herein) of their legitime.‖ Petitioners‘ strategy was to have the Deeds of Sale declared void so that ownership of the lots would eventually revert to their respondent parents. If their parents die still owning the lots, petitioners and their respondent siblings will then co-own their parents‘ estate by hereditary succession.[ It is evident from the records that petitioners are interested in the properties subject of the Deeds of Sale, but they have failed to show any legal right to the properties. [T]he question as to “real party-in-interest” is whether he is “the party who would be benefitted or injured by the judgment, or the „party entitled to the avails of the suit.‟” In actions for the annulment of contracts, such as this action, the real parties are those who are parties to the agreement or are bound either principally or subsidiarily or are prejudiced in their rights with respect to one of the contracting parties and can show the detriment which would positively result to them from the contract even though they did not intervene in it. These are parties with “a present substantial interest, as distinguished from a mere expectancy or future, contingent, subordinate, or consequential interest…. The phrase ‗present substantial interest‘ more concretely is meant such interest of a party in the subject matter of the action as will entitle him, under the substantive law, to recover if the evidence is sufficient, or that he has the legal title to demand and the defendant will be protected in a payment to or recovery by him.‖ Petitioners do not have any legal interest over the properties subject of the Deeds of Sale. As the appellate court stated, petitioners‟ right to their parents‟ properties is merely inchoate and vests only upon their parents‟ death. While still living, the parents of petitioners are free to dispose of their properties. In their overzealousness to safeguard their future legitime, petitioners forget that theoretically, the sale of the lots to their siblings does not affect the value of their parents‟ estate. While the sale of the lots reduced the estate, cash of equivalent value replaced the lots taken from the estate.

2. The Deeds of Sale have valid considerations Petitioners assert that their respondent siblings did not actually pay the prices stated in the Deeds of Sale to their

respondent father. Thus, petitioners ask the court to declare the Deeds of Sale void. A contract of sale is not a real contract, but a consensual contract. As a consensual contract, a contract of sale becomes a binding and valid contract upon the meeting of the minds as to price. If there is a meeting of the minds of the parties as to the price, the contract of sale is valid, despite the manner of payment, or even the breach of that manner of payment. If the real price is not stated in the contract, then the contract of sale is valid but subject to reformation. If there is no meeting of the minds of the parties as to the price, because the price stipulated in the contract is simulated, then the contract is void. Article 1471 of the Civil Code states that if the price in a contract of sale is simulated, the sale is void. It is not the act of payment of price that determines the validity of a contract of sale. Payment of the price has nothing to do with the perfection of the contract. Payment of the price goes into the performance of the contract. Failure to pay the consideration is different from lack of consideration. The former results in a right to demand the fulfillment or cancellation of the obligation under an existing valid contract while the latter prevents the existence of a valid contract. Petitioners failed to show that the prices in the Deeds of Sale were absolutely simulated. To prove simulation, petitioners presented Emma Joaquin Valdoz‘s testimony stating that their father, respondent Leonardo Joaquin, told her that he would transfer a lot to her through a deed of sale without need for her payment of the purchase price.The trial court did not find the allegation of absolute simulation of price credible. Petitioners‘ failure to prove absolute simulation of price is magnified by their lack of knowledge of their respondent siblings‘ financial capacity to buy the questioned lots. On the other hand, the Deeds of Sale which petitioners presented as evidence plainly showed the cost of each lot sold. Not only did respondents‘ minds meet as to the purchase price, but the real price was also stated in the Deeds of Sale. As of the filing of the complaint, respondent siblings have also fully paid the price to their respondent father.

3. Inadequacy in the price shall not invalidate a contract Petitioners ask that assuming that there is consideration, the same is grossly inadequate as to invalidate the Deeds of Sale. Articles 1355 of the Civil Code states: Art. 1355. Except in cases specified by law, lesion or inadequacy of cause shall not invalidate a contract, unless there has been fraud, mistake or undue influence. (Emphasis supplied) Article 1470 of the Civil Code further provides: Art. 1470. Gross inadequacy of price does not affect a contract of sale, except as may indicate a defect in the consent, or that the parties really intended a donation or some other act or contract. (Emphasis supplied)

Petitioners failed to prove any of the instances mentioned in Articles 1355 and 1470 of the Civil Code which would invalidate, or even affect, the Deeds of Sale. Indeed, there is no requirement that the price be equal to the exact value of the subject matter of sale. All the respondents believed that they received the commutative value of what they gave. The factual findings of the appellate court are conclusive on the parties and carry greater weight when they coincide with the factual findings of the trial court. This Court will not weigh the evidence all over again unless there has been a showing that the findings of the lower court are totally devoid of support or are clearly erroneous so as to constitute serious abuse of discretion. In the instant case, the trial court found that the lots were sold for a valid consideration, and that the defendant children actually paid the purchase price stipulated in their respective Deeds of Sale. Actual payment of the purchase price by the buyer to the seller is a factual finding that is now conclusive upon us. WHEREFORE, we AFFIRM the decision of the Court of Appeals in toto.

General principles in the agreement as to price Boston Bank Of The Philippines V. Manalo FACTS: Xavierville Estate, Inc. (XEI) was the own land known as the Xavierville Estate Subdivision. XEI subdivided the property into residential lots and offered it for sale to individual lot buyers. XEI and Overseas Bank of Manila (OBM) executed a "Deed of Sale of Real Estate" over some residential lots in the subdivision XEI president Emerito Ramos, Jr. contracted the services of Engr. Carlos Manalo, Jr. to install water pump for him. Manalo then proposed to XEI, through Ramos, to purchase a lot in the Xavierville subdivision, and offered as part of the downpayment the P34,887.66 Ramos owed him. Ramos agreed. Manalo, Jr. informed Ramos that he and his wife Perla had chosen Lots 1 and 2 of Block 2. Ramos confirmed the reservation of the lots and pegged the price of the lots at P200.00/sq.m with a 20% down payment of the purchase price less the money owing from Ramos, payable on or Dember 1972. The corresponding Contract of Conditional Sale would then be signed on or before the same date, but if the selling operations of XEI resumed after December 31, 1972, the balance of the downpayment would fall due then, and the spouses would sign the aforesaid contract within 5 days from receipt of the notice of resumption of such selling operations. It was also stated in the letter that, in the meantime, the spouses may introduce improvements thereon subject to the rules and regulations imposed by XEI in the subdivision. Perla Manalo conformed to the letter agreement. The spouses Manalo took possession of the property, constructed a house and fenced the perimeter. The spouses Manalo were notified of the resumption of the selling operations of XEI. However, they did not pay the balance of the downpayment on the lots because Ramos failed to prepare a contract of conditional sale and transmit the same to Manalo for their signature. Manalo went to XEI office and requested that the payment of the balance be deffered which XEI rejected. A few months after, spouses Manalo received a statement of account for their unpaid balance plus the interests twice. Manalo still refused to pay because the conditional contract of sale was not transmitted to them yet. In 1976, Manalo constructed a business sign in the sidewalk near his house. XEI informed Manalo that business signs were not allowed along the sidewalk and demanded that he remove the same, on the ground that the sidewalk was not part of the land which he had purchased on installment basis from XEI.Manalo did not respond. XEI turned over its selling operations to OBM. OBM

warned Manalo that "putting up of a business sign is specifically prohibited by their contract of conditional sale" and that his failure to comply with its demand would impel it to avail of the remedies as provided in their contract of conditional sale. In 1979, the Register of Deeds issued TCT over Lot 2, Block 2, in favor of the OBM. When Commercial Bank of Manila (CBM) acquired Xavierville Estate from OBM, CBM requested Perla Manalo to stop any ongoing construction on the property since it (CBM) was the owner of the lot and she had no permission for such construction. She agreed to have a conference meeting with CBM officers where she informed them that her husband had a contract with OBM, through XEI, to purchase the property. When asked to prove her claim, she promised to send the documents to CBM. However, she failed to do so.CBM reiterated its demand that it be furnished with the documents promised, but Perla Manalo did not respond. CBM filed a complaint for unlawful detainer against the spouses with the MTC QC. Pending the case, the spouses wrote CBM to offer an amicable settlement, promising to abide by the purchase price of the property per agreement with XEI, through Ramos. However, they were not able to reach a settlement as CBM offfered 1,550/sqmeter. In the meantime, CBM was renamed the Boston Bank of the Philippines. After CBM filed its complaint against the spouses Manalo, the latter filed a complaint for specific performance and damages against the bank before RTC QC. ISSUE: Whether or not there is a perfected contract between petitioners and respondents. HELD: No! For a perfected contract of sale or contract to sell to exist in law, there must be an agreement of the parties not only on the price of the property sold but also on the manner the price is to be paid by the vendee. A contract of sale is perfected at the moment there is a meeting of the minds upon the thing which is the object of the contract and the price. From the averment of perfection, the parties are bound, not only to the fulfillment of what has been expressly stipulated, but also to all the consequences which, according to their nature, may be in keeping with good faith, usage and law. On the other hand, when the contract of sale or to sell is not perfected, it cannot, as an independent source of obligation, serve as a binding juridical relation between the parties. Price is an essential element in the formation of a binding and enforceable contract of sale. The fixing of the price can never be left to the decision of 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.It is not enough for the parties to agree on the price of the property. In a contract to sell property by installments, it is not enough that the parties agree on the price as well as the amount of downpayment. The parties must, likewise,

agree on the manner of payment of the balance of the purchase price and on the other terms and conditions relative to the sale. Even if the buyer makes a downpayment or portion thereof, such payment cannot be considered as sufficient proof of the perfection of any purchase and sale between the parties. In this case, petitioners admit that they and the respondent still had to meet and agree on how and when the down-payment and the installment payments were to be paid. This being the case, no definite and firm sales agreement between the parties had been perfected. A definite agreement on the manner of payment of the purchase price is an essential element in the formation of a binding and enforceable contract of sale. The fact that the petitioners delivered to the respondent the sum of P10k as part of the downpayment that they had to pay cannot be considered as sufficient proof of the perfection of any purchase and sale agreement between the parties herein under article 1482 of the New Civil Code, as the petitioners themselves admit that some essential matter s, such as the terms of payment still had to be agreed upon. Petitioner is correct in saying that there is no schedule of payment of the balance of the purchase price on the property. The parties confined sed on the SC‘s findings, the parties confined themselves to agreeing on the price of the property, the 20% downpayment of the purchase price, and credited respondents for the P34,887.00 owing from Ramos as part of downpayment. The timeline for the payment of the balance of the downpayment was also agreed upon, that is, on or before XEI resumed its selling operations on December 31, 1972, or within 5 days from written notice of such resumption of selling operations. The parties had also agreed to incorporate all the terms and conditions relating to the sale, inclusive of the terms of payment of the balance of the purchase price and the other substantial terms and conditions in the "corresponding contract of conditional sale," to be later signed by the parties, simultaneously with respondents‘ settlement of the balance of the downpayment. Jurisprudence is that if a material element of a contemplated contract is left for future negotiations, the same is too indefinite to be enforceable. And when an essential element of a contract is reserved for future agreement of the parties, no legal obligation arises until such future agreement is concluded. So long as an essential element entering into the proposed obligation of either of the parties remains to be determined by an agreement which they are to make, the contract is incomplete and unenforceable. The reason is that such a contract is lacking in the necessary qualities of definiteness, certainty and mutuality. There is no evidence on record to prove that XEI or OBM and the respondents had agreed, after December 31, 1972, on the terms of payment of the balance of the purchase price of the property and the other substantial terms and conditions relative to the sale.

Indeed, the parties are in agreement that there had been no contract of conditional sale ever executed by XEI, OBM or petitioner, as vendor, and the respondents, as vendees.

1. The C A cit ed f our in sta nce s i n th e re cord t o sup port i ts ho ldi ng th at pet it ion er ―r e - l end s ‖ th e amou nt borr ow ed fro m resp ond ent to h er frie nd s : firs t, the fr ien ds o f p e tit ion er n eve r pre se nte d them se lv es t o re spo nde nt and t hat al l tra ns act io n s were mad e b y an d bet wee n pe ti tio ner and resp ond ent ; sec ond ; the mone y pas se d t hrou gh th e ban k ac cou nt s of p et iti o ner an d res pon den t; th ird , pet iti oner her se lf adm itt e d th at she wa s ―r e - le nd in g‖ the mo ne y loa ned t o oth e r indi v idu al s for pro fi t; an d fourt h, th e d ocu men tar y ev ide nc e sho ws th at th e act ual borr ow ers, the fri e nds o f pe ti tio ner , co ns ide r her a s the ir cre dit or a nd n ot t he r es pon den t. Bas ed on t he fore go ing , t he C A co nc lu ded th a t pet iti oner is t he re al b orro wer, wh il e the r es pon den t, the r ea l l en der. Ho wev e r, a s co r re ctly n o t ed b y th e RT C , re sp ondent , then p la in t iff, m ad e th e ad m is sio n d u ri ng he r c ross e xam i n atio n th at sh e h e rse lf wa s acting a s an ag en t t o Ar sen io P ascu a, th e p rin cip al f inanc ie r. R espond ent i s est o p p ed to d en y th at s h e h er self act ed as ag en t o f a ce rt ain A rsen io Pu a, h er di sclo sed p rin c ip al . Sh e is also e sto p ped t o d en y th at p etit ion e r act e d as ag e n t fo r th e al lege d d eb to rs, th e f rien d s wh o m sh e (p etit ion er) ref e rr ed. This Co urt h as af fir med that , un der Art ic le 1868 of t he C iv il C ode , the b as is of ag en cy i s repre sen tat io n. The qu es t ion of wh et her an age nc y has bee n cr eat ed is ord in aril y a qu est io n w hi ch m a y be e st abl is hed i n t he sa me way a s a ny oth er fac t, eit her by dir ect or ci rc umst ant ia l e vi den ce . T h e que sti on i s ul ti mat el y one of int ent io n. Ag enc y ma y eve n be imp li ed fro m the words a nd co ndu ct of t h e part ies an d th e c irc ums tan ces of the part ic ul ar cas e.Th ou gh the fa ct or ext ent of au tho rit y of th e agen ts ma y no t, a s a ge nera l rul e, be e sta bl is he d from t he de cl ara tio ns o f the ag ent s a lon e, i f on e profe ss es to a ct as a gen t fo r a not her, s he ma y b e est opp ed to de ny h er ag enc y bot h as ag ai ns t th e ass erte d pri nc ipa l an d the third p erso ns i nte res ted i n the tran sa ct ion i n whi ch h e or sh e i s eng age d. In thi s c ase , p e titio n e r kn e w th at the fin anc ie r of re sp o n d en t is P ascu a; an d re sp ondent kne w th at t h e b o r ro w er s a r e f ri end s o f p etit ione r .

The C A is inco r re ct whe n it consid e red th e fact that the “ suppos e d frien ds of [petit ione r ], the actu al bo r row e rs, di d not pre sent th em se lve s to [ respon dent] ” a s e v idenc e that neg ates th e agenc y r elat ionsh ip — it i s suf fi ci ent t hat pet it ion e r dis cl os ed t o re spo nde nt t hat t he form er w as act in g in be ha lf o f her p rin ci pa ls, her fr ie nds wh om s h e referr ed to r es pon den t. F or an a gen cy t o ar ise , it i s not ne ces sar y tha t t he pr in ci pa l p ers ona ll y enc oun ter th e th ird p ers on w ith who m the age n t int erac ts . T he l aw in fa c t con tem pla te s, an d to a gr eat de gree , i mper so n al d ea lin gs wh ere the prin ci pa l need n ot per son all y kn ow or me et th e thir d pers on wit h w hom her a ge nt tra ns act s: pre ci sel y, th e purpo se of ag en cy is t o ex tend the p ers ona li ty of th e prin ci pa l t hrou gh the fa ci li ty of the ag ent . In the ca se at b ar, b oth pe ti tio ner a nd resp ond ent ha ve un den ia bly d is cl ose d to ea ch oth er that th ey are repr es ent i ng some one e lse , a nd s o both o f them ar e est opp e d to den y the s ame. It i s evi den t from the re cor d th at pet it ion er mer el y ref ers act ual borr owe rs a nd t hen col le ct s and di sbu rse s th e amou nts of t he l oan up on w hi ch s he re ce iv ed a comm is si on; an d t hat re sp onde nt tran sa ct s o n b eha l f of her ―pr in cip al f ina nc ier ‖, a cert ain Ars en io Pua . I f the ir res pe cti ve pr in ci p als d o no t ac tua ll y an d pers ona ll y kno w ea ch oth e r, s uch i gnor an ce doe s not affe ct t heir jur idi ca l st an din g as ag ent s, e spe ci al l y sin ce th e ver y pur pos e o f agen cy i s to e xte nd th e pers ona li ty of the pr in cip a l th rou gh the fa ci li ty of th e agen t. Wi th res pe ct to th e adm i ss ion of p eti ti oner that s he is ―re - len din g ‖ the mo ney l oan ed fro m resp ond ent to oth er ind iv i dua ls for prof it , i t m ust b e stre ss ed t hat the m ann er in wh ich the part ie s des ign ate the re la tio ns hi p is n ot c ontr ol li ng . I f a n act don e b y on e per so n i n beha lf of a not her is in it s ess ent ia l nat ure one o f agen cy , the for mer i s t h e agen t of t he l att er no tw it hst and ing he or she is n ot so c al le d. Th e q ues ti on i s to be det ermi ned by th e fac t th at o ne re pre sen ts and is a ct in g for ano ther , and if re la tio ns e xi st wh ich wi ll co ns tit ut e an agen cy , it w il l b e an ag enc y wh eth er t he par ti e s under st ood th e e xa ct nat u re of th e r ela ti on or n ot. That both pa rt ies act ed as m e re agent s is shown b y th e undi spute d fact that t he f ri ends o f petition e r issu ed chec ks in paym ent of the loan i n the nam e of Pu a. If it i s t rue t hat p etit ione r wa s “r e- l ending ”, th en th e c hecks shou ld ha ve b ee n

d ra wn in he r nam e a n d n o t d ir ectl y p aid t o Pa scua . Wi th r es pec t to t he se con d p oin t, part icu lar ly , th e f ind in g of th e C A tha t th e dis bur sem ent s a nd pa yme nts for th e l oa n w ere ma d e throu gh th e ban k ac c ount s of pe tit io ner an d resp ond ent , su ff ic e it to say tha t in the norm a l cour se of co mmer ci al de ali ng s a nd for r ea son s o f con ven ie nce a nd pra ct ica l ut il it y it ca n b e reas ona bl y ex pe cte d tha t the f ac il iti es o f th e ag ent , suc h a s a b an k ac co unt , may b e em pl oye d, and th at a sub - ag ent b e ap po int ed, suc h as the b an k it se lf, t o carr y out t he ta sk , esp eci al ly wher e ther e is n o sti pu lat ion to th e con trar y. In vi ew o f th e two ag e n cy re latio n ship s, p etition e r and re sp o n d e n t ar e n o t p ri vy to th e co n t ract of loan b etw ee n th ei r p rin cip a ls. Sin c e th e sal e is p redi cate d o n th at lo an , th e n the sal e is vo id fo r la ck of co n sid er atio n . 2. A fu rth e r sc r u tin y o f th e reco rd sh o ws , howe ve r, th a t th e sale m i g h t h ave b ee n b acke d up by an o th e r co n s id e rat io n th at is sep a rat e an d di stin ct f r o m th e d eb t: re sp onden t ave r red in h e r co m p lai n t an d t estif ied that th e p art ies h ad ag reed th at as a co n d itio n for the co n ve yanc e of the p ro p ert y th e resp o n d en t sh a ll assum e the bal an ce o f th e m o rt g ag e lo an wh ic h p etition e r a lleg ed ly o w ed to th e N HMF C. Thi s Cour t in the re cen t pa st has d ec lare d t hat a n assum pt ion of a m o rtg a g e d eb t m a y co n st itute a valid con side r atio n fo r a sal e. Al tho ugh t he re cord s ho ws th at pe tit io ner admi tte d at t he t ime o f tria l tha t sh e o wne d th e prope rty de scr ib ed in the T CT , the C ourt mu st str es s that the T r an sfe r Ce rt ific ate of T itle No . 382 532 ] on its f ace sh o ws th at th e o wne r o f th e pr ope rty whi ch ad m itted l y fo rm s th e subj ec t m atte r of the De ed o f Ab so lu te S ale refe r s ne ithe r to the petition er n o r t o h er fath e r , T eo do ric o Do le s, t he all eged co - o wn e r. Rath e r , it sta te s th at the p rop e rty is re g iste re d in th e n am e o f “Ho u se ho ld Dev elo p m en t Co rp o rat io n . ‖ A lth oug h there is an en try to th e ef fec t tha t th e pe tit io ner h a d been gr ant ed a spe ci al p ower o f a ttor ne y ―co veri n g the sh are s of Teo dor ico Do les o n the par ce l of l a nd des cri bed in t hi s ce rti fi ca te, ‖ it ca n n o t b e inf e r re d f ro m th is b ar e n o ta tio n , n o r f ro m an y othe r evid e nce on the reco rd , th at th e p eti tio n e r o r he r fath e r held an y di rect i n ter est o n th e p ro p e rt y i n

question so as to va lid ly const itute a m o rtg ag e ther eon and, w ith m or e rea son, to effe ct the deliv e ry of th e obj ec t of th e s ale at th e consum m a tion stage . What is wo rs e, th er e i s a notation that the T CT its elf h as b een “c ance lled .” In vi ew of th ese ano m alie s, the Cou rt cannot ente rta in th e po ssibi lit y that respon den t agr eed to assum e th e balan ce o f the m o rtg ag e loan whic h pet ition e r all eged ly o wed to t he NH MFC , espe ci all y sinc e the r eco rd is b er eft of any factu al fin ding that petition e r wa s, in the f i r st place , en dowe d w ith a ny own e rship rights t o valid ly m o rtgag e and co nvey the p rope rt y . A s th e comp la in ant who ini ti ate d the c as e, re spo nde nt bear s t he b urd en o f p rovi ng the ba si s o f h e r comp la in t. H av ing fa il ed to d is ch arge s uch bu rde n , the Co urt has no ch oi ce b ut t o d ec lare th e s ale v oi d for la ck o f ca use . A nd s inc e the sal e i s vo id, t h e Cour t fi nds it un nec es s ar y to dw el l on th e is su e o f whe ther dure ss or int im ida tio n had bee n foi st e d upon pe ti tio ner up on the e xec ut ion of th e s al e. Moreo ver , e ve n a ss umi ng t he mort gag e val id ly ex is ts, th e C ourt not es r es pon den t‘ s all ega ti on tha t t he mort ga ge wi th the N HMF C wa s fo r 25 y ear s w hi ch bega n Se pte mber 3, 1994 . Re sp ond ent fi le d her Com pl ain t f or Sp ec if i c Per form an ce in 1 99 7. S i nce t he 25 year s had no t lap sed , the pra yer of res pon den t to com pe l pet iti oner to e xec ute ne c ess ary do cum ent s t o e ffe ct the tran sf er o f t it le i s pr e matur e. WH E R EF OR E, t he pe ti tio n is gra nte d. Th e De ci sio n an d R es olu ti on of th e C ourt of Ap pea l s are R E VE R S E D a nd S ET A SI DE . The c omp la int o f resp ond ent in Ci vi l Cas e N o. 9 7 - 82 7 16 is DI S MI S S ED .