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Republic of the Philippines

Supreme CourtManila 

FIRST DIVISION 

MCA-MF CO!NTDO"N CARDSP#I$IPPIN%S INC&' AMA$% R& A(!I$!) V'AMA$% C& A(!I$!) I*' CI%$O C&A(!I$!)' A$%RTO $& !%NVIA+%'VIC%NT% ACSA, an MCA #O$DIN(SAND MANA(%M%NT CORPORATION'  Petitioners, - versus  - Mf CARD INT%RNATIONA$ $IMIT%D anMf DISCO!NT CARD $IMIT%D'

Respondents.

  (&R& No& ./0123 Present: CORONA, C.J.,  Chairperson,LEONARDO-DE CASTRO,BERSAMIN,VILLARAMA,  R., andPERLAS-BERNABE,!  JJ. 

Pro"#$%ated: 

Mar&h '(, )*')+- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -+ 

R % S O $ ! T I O N 

$%ONARDO-D% CASTRO' J&4 

 This is a Petition or Reie on Certiorari assai$in% the Reso$#tions

o the Co#rt o Appea$s in CA-/.R. CV No. 0(12* dated Mar&h )*,

)**34'5  and #$6 3, )**3.4)5

 

7erein respondents MB Card Internationa$ Li"ited 8MB Card9 and

MB Dis&o#nt Card Li"ited 8MB Dis&o#nt Card9, oth orei%n &orporations

not doin% #siness in the Phi$ippines, ;$ed a &o"p$aint or Re&oer6 o 

Mone6, Co#ntdon Cards Phi$ippines, In&.,i.e., petitioner MCA-MB>. A&&edin%

to a reF#est in the sa"e $etter, respondent MB Card re"itted on an#ar6

)', '( the a"o#nt o . The #nderstandin% as that s#&h a"o#nt as to e app$ied as MB Cards pa6"ent o its (* shareho$din% in the VC #pon the e+etion and

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approa$ o the oint Vent#re and Li&ensin% A%ree"ents.4(5  7oeer,

itho#t the prior a#thorit6 o the respondents, and hi$e the parties ere

sti$$ disssin% and ne%otiatin% on the ter"s and &onditions o the oint

Vent#re and Li&ensin% A%ree"ents, petitioners, thro#%h the intended VC

8petitioner MCA-MB>9, e%an to pro"ote, "aret and se$$ the Co#ntdon

Dis&o#nt Cards to the p#$i&, #sin% the Co#ntdon na"e, $o%o and

trade"ar.4J5

 

 The Co"p$aint then a$$e%ed the a&ts that $ed #p to respondents

de&ision to end its ne%otiations ith petitioners:

 0. A&&ordin%$6, 4respondent5 MB &ard adised

4petitioners5 not to pro"ote, "aret and se$$ Co#ntdonDis&o#nt Cards to the p#$i& #nti$ the oint Vent#reA%ree"ent and the Li&ense A%ree"ent 8or the #se o the

tradena"e Co#ntdon and the or"at and "ethod orthe operation o the Co#ntdon Dis&o#nt Card9 had eensi%ned and, thereater, approed 6 the appropriate%oern"ent a%en&6.

 . In parti$ar, on Mar&h 0 and '2, '(,

4respondent5 MB Card rote 4petitioner5 MCA-MB>s R#6Pear$ M. Shan to ree?e a$$ se$$in% a&tiities on theCo#ntdon Dis&o#nt Card #nti$ ater the pertinentA%ree"ents had een si%ned and approed. + + +.

 '*. In rep$6 to 4respondent5 MB Cards ree?e

adi&e, 4petitioner5 A"a$e R. A%#i$#? V pro"ised that the6

o#$d &o"p$6 thereith. This as &on;r"ed 6 R#6 Pear$M. Shan, ho rote 4respondent5 MB Card on Mar&h ','( to &on;r" that se$$in% a&tiities o Dis&o#nt Cardhae een ordered 4ro?en5 te"porari$6, eKe&tie'*th Mar&h '(. + + +.

 ''. On Mar&h 1* and Apri$ 1, '(, eore an6 o 

the oint Vent#re and Li&ense A%ree"ents had een si%nedand approed, and ith "a$i&e, ad aith and in rea&h o 4petitioners5 pro"ise to 4respondent5 MB Card, the4petitioners5 i$$e%a$$6 &a#sed the p#$i&ation o toadertise"ents in the Mani$a B#$$etin, pro"otin%,"aretin% and se$$in% the Co#ntdon Dis&o#nt Card. + + +.

 

''.' In the said ads, 4petitioners5ra#d#$ent$6 "isrepresented to the p#$i&that the6 hae a$read6 een a#thori?ed 64respondents5 to pro"ote, "aret and se$$the Co#ntdon Dis&o#nt Card and that thedis&o#nt &ards the6 oKer are a$id andenor&ea$e, and as s#&h o#$d e honoredin ario#s esta$ish"ents in the Phi$ippinesand e$sehere.

 ''.) Moreoer, in the saidadertise"ents, 4petitioners5 oKered to thep#$i&, aside ro" the re%#$ar eat#res o the Co#ntdon Dis&o#nt Card, a p#r&haseprote&tion p$an and een persona$ a&&identins#ran&e. This &a#sed %reat &on&ern or4respondents5 as, to their no$ed%e, thesehae not een ;r"ed #p ith an6ins#ran&e &o"pan6. '). hat is orse, in his &o$#"n appearin% in the

Apri$ 'J, '( iss#e o the Phi$ippine Star4,5 4petitioner5A"a$e R. A%#i$#? V "isrepresented to the p#$i& that he,representin% the MCA 7o$din%s had a&t#a$$6 si%ned a =ointent#re a%ree"ent ith Mr. /ordon #en, Chair"an, o theMa$a6sia Borneo >inan&e. No s#&h =oint ent#rea%ree"ent has to date een si%ned and Mr. /ordon #en ispresident and &hie e+etie o&er o 4respondent5 MB Card and not the &hair"an o Ma$a6sia Borneo >inan&e.

 '1. On Apri$ )*, '(, 4respondent5 MB Card

rote 4petitioners5, adisin% the" that it had de&ided notto pro&eed ith the =oint ent#re pro=e&t on the Co#ntdonDis&o#nt Card, and de"andin% that 4petitioners5i""ediate$6:

 

8a9 re#nd to 4respondent5 MB Cardthe

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'(. To date, to the da"a%e and pre=#di&e o 4respondents5, the 4petitioners5 &ontin#e to pro"ote,"aret and se$$ the Co#ntdon Dis&o#nt Card, there6"isrepresentin% to the p#$i& that the6 hae eena#thori?ed to do so, and that the Co#ntdon Dis&o#nt Cardthe6 oKer are a$id and indin% a%ainst4respondents5. These a&ts o 4petitioners5, in&$#din% their&ontin#ed #se o Co#ntdon and MB in the &orporatena"e and #siness o MCA-MB>, are in io$ation o 

4respondents5 $a#$ and e+&$#sie proprietar6 ri%hts tos#&h na"es. >#rther"ore, the6 are in ra#d o the p#$i&and &onstit#te #nair &o"petition hi&h sho#$d e en=oinedand or hi&h 4petitioners5 are $ia$e to 4respondents5 inda"a%es.435

 

Respondents pra6ed eore the tria$ &o#rt that petitioners e

en=oined ro" pro"otin%, "aretin% and se$$in% Co#ntdon Dis&o#nt Cards

and ro" #sin% the MB and Co#ntdon na"es, $o%os and

trade"ars. The6 a$so pra6ed that petitioners e ordered to re#nd to

respondent MB Card the s#" o ;$ed its Anser ith

Co#nter&$ai", &$ai"in% that the &ontra&t eteen the parties had a$read6

een pere&ted. The parties a$$e%ed$6 a%reed that 8'9 the6 =oint$6

#ndertoo the tas o "aretin% the MB Dis&o#nt Card in the Phi$ippines

8)9 MB Card as so$e$6 responsi$e or serin% the ne&essar6 se$$in%

parapherna$ia ro" the "ain Li&ensor, Co#ntdon o London, En%$and and

819 /ordon #en and T.. on% ere e$e&ted as "e"ers o the Board o 

Dire&tors o the oint Vent#re Corporation. Petitioner MCA-MB> asserted

that MB Card did not s#Ker an6 da"a%e ro" the introd#&tion and

"aretin% o the MB Co#ntdon Dis&o#nt Card in the Phi$ippines sin&e a$$

a&ts pertainin% to the #siness ere =oint$6 #ndertaen 6 the parties. In

its Co#nter&$ai", petitioner MCA-MB> pra6ed or da"a%es in the a"o#nt

oP)),J**,***.**, and an order dire&tin% respondents to e+ete, si%n and

s#"it the or" o the oint Vent#re A%ree"ent as a$$e%ed$6 approed and

a&&epted 6 petitioners on Mar&h '3, '(.

 

On A#%#st '*, '(, the tria$ &o#rt iss#ed the rit o Pre$i"inar6

In=#n&tion on a&&o#nt o the postin% 6 the respondents o the reF#ired

ond.

On O&toer '0, '3, petitioners Vi&ente R. A&sa6, A"a$e R.

A%#i$#? V, A"a$e C. A%#i$#? I@, Cie$o C. A%#i$#?, A$erto B#enia=e and

MCA 7o$din%s ;$ed their Anser, a$$e%in% pra&ti&a$$6 the sa"e deenses as

those raised 6 petitioner MCA-MB>.

 

On #ne 0, '0, the $a ;r" o Casti$$o La"an Tan Panta$eon Q

San ose 8CLTPS9 ;$ed a Motion to Re&ord Attorne6s Lien. 7oeer, hi$e

CLTPS did not ithdra its appearan&e in the &ase, the $a ;r" o 

Po$ador Ba#tista Q Re6es 8PBR9 entered its appearan&e in O&toer '(

and has sin&e then een the ;r" representin% respondents. On A#%#st )2,

'0, the tria$ &o#rt noted the pra6er to re&ord attorne6s $ien and he$d

that the sa"e sha$$ e &onsidered in the ad=#di&ation o the &ase. 

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On Mar&h 0, )***, the tria$ &o#rt rendered its De&ision in aor o 

respondents. The dispositie portion o the De&ision reads:

 7ERE>ORE, pre"ises &onsidered, =#d%"ent is

here6 rendered per"anent$6 en=oinin% the 4petitioners5ro" pro"otin%, "aretin% and se$$in% Co#ntdon Dis&o#ntCards, and ro" #sin% MB and Co#ntdon na"es,

$o%os and trade"ars orderin% 4petitioners5 to =oint$6 andseera$$6 re#nd to 4respondent5 MB Card the s#" o I>T T7O

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the6 hae not 6et e+eted the do"entsor"a$i?in% said &ontra&t. 

1. The Tria$ Co#rt erred in ;ndin% that petitionershae not proen Tan Sris a#thorit6 to representand ind the respondents to the =oint ent#rea%ree"ent. 

(. The Tria$ Co#rts aard o attorne6s ees is

deoid o $e%a$ asis.4'*5

 

Petitioners pra6 eore this Co#rt that their appea$ eore the Co#rt

o Appea$s, CA-/.R. CV No. 0(12*, e reinstated.4''5

 

e reso$e to den6 the present petition.

 

Conronted ith the ne&essit6 to =#sti6 their ai$#re to ;$e their

Appe$$ants Brie eore the Co#rt o Appea$s, a$$ that the petitioners &o#$d

oKer as that the $a6er ho as hand$in% the &ase resi%ned ro" the $a

;r" short$6 ater the6 re&eied the noti&e to ;$e the Brie, hi$e other

&o#nse$s hae een hand$in% o$#"ino#s &ases, n#"ero#s &o#rt

appearan&es, and o#t o ton hearin%s. Petitioners did not a$$e%e that the

other $a6ers o the ;r" ere not inor"ed o the appe$$ate &o#rts noti&e

to ;$e the Brie. Petitioners did not een as the &o#rt or an

e+tension. Instead, petitioners &$ai" that the r#$es &on&ernin% the ;$in% o 

the Appe$$ants Brie are "ere insi%ni;&ant and har"$ess

te&hni&a$ities4')5 and ar%#e that e&a#se o the a$$e%ed "erits o their

&ase, the6 do not hae to proe that their ai$#re to ;$e the said rie as

e+sa$e:

 In $i%ht o the "erits o petitioners appea$ as i$$ e #rtherdisssed e$o, and in a&&ordan&e ith the =#rispr#den&edis&o#ra%in% dis"issa$ o appea$s %ro#nded on p#rete&hni&a$ities,5hether or not the ina6ertenceresultin7 in the late 8lin7 of the appellant9s brief ise:cusable is alrea; besie the point. The ossho#$d hae een on hether or not the appea$ desered

#$$ &onsideration on the "erits, and this &an on$6 edeter"ined i a pre$i"inar6 &onsideration o the "erits is"ade.4'15 8E"phasis added.9 

 This &ontention, hi&h in eKe&t adan&es that the appe$$ate &o#rt

does not een desere a a$id e+p$anation or the appe$$ants ai$#re to its

Brie, &annot e &o#ntenan&ed. Liera$it6 is %ien to $iti%ants ho are

orth6 o the sa"e, and not to ones ho o#t the r#$es, %ie e+p$anations

to the eKe&t that the &o#nse$s are #s6 ith other thin%s, and e+pe&t the

&o#rt to disre%ard the pro&ed#ra$ $apses on the "ere se$-serin% &$ai" that

their &ase is "eritorio#s.

In Rural Bankers Association of the Philippines v. Tanghal-Salvaña,

4'(5 this Co#rt he$d:

 Oedien&e to the reF#ire"ents o pro&ed#ra$ r#$es

is needed i the parties are to e+pe&t air res#$ts therero",and #tter disre%ard o the r#$es &annot =#st$6 erationa$i?ed 6 harin% on the po$i&6 o $iera$&onstr#&tion. Pro&ed#ra$ r#$es are too$s desi%ned toa&i$itate the ad=#di&ation o &ases. Co#rts and $iti%antsa$ie are th#s en=oined to aide stri&t$6 6 the r#$es. Andhi$e the Co#rt, in so"e instan&es, a$$os a re$a+ation inthe app$i&ation o the r#$es, this as neer intended toor%e a astion or errin% $iti%ants to io$ate the r#$es ithi"p#nit6. The $iera$it6 in the interpretation andapp$i&ation o the r#$es app$ies on$6 in proper &ases and

#nder =#sti;a$e &a#ses and &ir"stan&es. hi$e it is tr#ethat $iti%ation is not a %a"e o te&hni&a$ities, it is eF#a$$6tr#e that eer6 &ase "#st e proseted in a&&ordan&eith the pres&ried pro&ed#re to ins#re an order$6 andspeed6 ad"inistration o =#sti&e.4'J5

 

>#rther"ore, petitioners &hara&teri?ation o the r#$es &on&ernin%

the ;$in% o the Appe$$ants Brie as insi%ni;&ant and har"$ess

te&hni&a$ities is donri%ht i"proper as it is &ontrar6 to esta$ished

 =#rispr#den&e. In Casim v. lor!eli"a,4'35

 this Co#rt parti$ar$6 he$d that: 

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It o#$d e in&orre&t to per&eie the pro&ed#ra$reF#ire"ents o the r#$es on appea$ as ein% "ere$6har"$ess and triia$ te&hni&a$ities that &an =#st edis&arded. As this Co#rt so e+p$ained in #el Rosario vs.Court of Appeals 

 Petitioners p$ea or $iera$it6 in

app$6in% these r#$es in preparin%Appe$$ants Brie does not desere an6

s6"path6. Lon% in%rained in o#r =#rispr#den&e is the r#$e that the ri%ht toappea$ is a stat#tor6 ri%ht and a part6 hosees to aai$ o the ri%ht "#st aith#$$6&o"p$6 ith the r#$es. In People vs.$arong, e he$d that deiations ro" ther#$es &annot e to$erated. The rationa$e orthis stri&t attit#de is not di$t toappre&iate. These r#$es are desi%ned toa&i$itate the order$6 disposition o appea$ed &ases. In an a%e here &o#rts areedei$ed 6 &$o%%ed do&ets, these r#$esneed to e o$$oed 6 appe$$ants ith%reater ;de$it6. Their oseran&e &annot e$et to the hi"s and &apri&es o appe$$ants.4'25

 

Petitioners &$ai" that the tria$ &o#rt De&ision as erroneo#s on its

a&e and that een a rsor6 readin% o the sa"e o#$d sho prima

facie "erit in the appea$ is in itse$ a %rae e+a%%eration. In a$$e%in%

the prima facie "erit o its appea$, petitioners re$6 on to "ain %ro#nds:

8'9 the RTC a$$e%ed$6 disre%arded the asi& prin&ip$es o &ontra&t $a hen

it r#$ed that the =oint ent#re a%ree"ent had not 6et een pere&ted and

8)9 the RTC a$$e%ed$6 disre%arded &orporate ;&tion in ad=#d%in% indiid#a$

petitioners persona$$6 $ia$e to respondents.

 

 The asi& prin&ip$es o &ontra&t $a reerred to 6 petitioners are

those enshrined in Arti&$e '1'J 4'05 o the Cii$ Code, hi&h proides that

&ontra&ts are pere&ted 6 "ere &onsent, and in Arti&$e '1J3,4'5 hi&h

states that &ontra&ts sha$$ e o$i%ator6 in hateer or" the6 "a6 hae

een entered into, proided a$$ the essentia$ reF#isites or their a$idit6 is

present.

It is &$ear ro" a readin% o the RTC De&ision that the aoe

prin&ip$es ere not disre%arded. On the &ontrar6, the RTC ent e6ond the

a&t that the oint Vent#re and Li&ensin% A%ree"ent has 6et to e si%ned,

and &are#$$6 ei%hed the eiden&e in order to deter"ine hether or not

there as a pere&ted ora$ =oint ent#re a%ree"ent:

 

'. The tria$ &o#rt had to $oo into hether Tan Sri had the

a#thorit6 to ind respondents in the a$$e%ed ora$ a%ree"ent. In

this re%ard, the tria$ &o#rt o#nd no eiden&e proin% the

sa"e. The RTC instead &onsidered the ad"ission o A%#i$#? V

that he neither ne nor inF#ired hether Tan Sri as an

o&er or dire&tor o the p$aintiK &orporations.4)*5

). Despite the asen&e o a ritten &ontra&t, the RTC disssed

hether or not the re"ittan&e o #rther"ore, it appeared to the RTC that the adi&e and

s#%%estions ro" respondents or the sa$e, pro"otion and

"aretin% o the dis&o#nt &ards are "ere$6 preparator6 a&ts

and does not ne&essari$6 indi&ate the e+isten&e o a pere&ted

&ontra&t.

4)15

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1. It as shon that the RTC so#%ht to deter"ine the e+isten&e

o a oint Vent#re and Li&ensin% A%ree"ent despite the

asen&e o a ritten &ontra&t eiden&in% the sa"e hen it

&onsidered thereor the $etter o itness L#is Pan%#$a6an in

eha$ o petitioner A%#i$#? V. The RTC F#oted Pan%#$a6ans

Apri$ '(, '( $etter herein it as ad"itted that 8a9 the

si%nin% o the oint Vent#re A%ree"ent is reF#ired to ;na$i?e

the or"ation o the VC sin&e the proisions o the &ontra&t

sha$$ e in&orporated in the VCs B6-Las and 8)9 een the

or"ation o the VC does not ne&essari$6 &o"p$ete the pro&ess

sin&e a Li&ensin% A%ree"ent sti$$ needs to e e+eted

eteen the VC and respondents.4)(5

 

In addition to the aoe, hi$e e a%ree ith petitioners that the

asen&e o a %ritten oint Vent#re and Li&ensin% A%ree"ent does not

ne&essari$6 ne%ate the pere&tion o a &ontra&t, e neerthe$ess ;nd that

this er6 $a& o a ritten &ontra&t &onstit#tes &onin&in% &ir"stantia$

proo that said parties ere indeed in the pro&ess o ne%otiatin% the

&ontra&ts ter"s. hen there is as o 6et no "eetin% o the "inds as to

the s#=e&t "atter or the &a#se or &onsideration o the &ontra&t ein%

ne%otiated, the sa"e &annot e &onsidered to hae een pere&ted.

 

In r#$in% in aor o respondents, the RTC "ade a a&t#a$ ;ndin%

that the oint Vent#re and Li&ensin% A%ree"ent ein% ne%otiated eteen

petitioners and respondents as neer pere&ted. Respondents are neither

in&orporators nor sto&ho$ders o MCA-MB>, the &o"pan6 that as

s#pposed$6 intended to e &onerted into the oint Vent#re Co"pan6. It

"#st e stressed that MCA-MB> has not 6et een &onerted into the oint

Vent#re Co"pan6 as no shares o sto& hae een de$iered torespondents. As a$$e%ed 6 respondents and o#nd 6 the RTC, the

respondents ere ass#red that the "one6 re"itted 6 the" i$$ on$6 e

app$ied to its proposed (* shareho$din% in the VC #pon the e+etion

and approa$ o the oint Vent#re and Li&ensin% A%ree"ents. Thereore,

hi$e the

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(&R& No& .1er#ar6 'J, respondent Ri&a Marie S. Thio re&eied ro"

petitioner Caro$6n M. /ar&ia a &rossed &he& ( dated >er#ar6 )(, 'J in

the a"o#nt o ORE, ;ndin% preponderan&e o eiden&e to s#stain the instant

&o"p$aint, =#d%"ent is here6 rendered in aor o 4petitioner5, senten&in%4respondent5 to pa6 the or"er the a"o#nt o:

'. 4or $a& o "erit, 4respondents5 &o#nter&$ai" is peror&e dis"issed.

ith &osts a%ainst 4respondent5.

IT IS SO ORDERED.)'

On appea$, the CA reersed the de&ision o the RTC and r#$ed that there

as no &ontra&t o $oan eteen the parties:

A per#sa$ o the re&ord o the &ase shos that 4petitioner5 ai$ed tos#stantiate her &$ai" that 4respondent5 indeed orroed "one6 ro"

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her. There is nothin7 in the recor that sho5s that ?responent@

recei6e mone; from ?petitioner@& hat is eident is the a&t that

4respondent5 re&eied a MetroBan 4&rossed5 &he& dated >er#ar6 )(,

'J in the s#" o

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ino$ed ere F#ite i%. Respondent, on the other hand, a$read6 had

transa&tions ith Santia%o at that ti"e.1)

Se&ond, Leti&ia R#i?, a riend o oth petitioner and respondent 8and hose

na"e appeared in oth parties $ist o itnesses9 testi;ed that

respondents p$an as or petitioner to $end her "one6 at a "onth$6

interest rate o 1, ater hi&h respondent o#$d $end the sa"e a"o#nt to

Santia%o at a hi%her rate o J and rea$i?e a pro;t o ). 11 This e+p$ained

h6 respondent instr#&ted petitioner to "ae the &he&s pa6a$e toSantia%o. Respondent has not shon an6 reason h6 R#i? testi"on6

sho#$d not e e$ieed.

 Third, or the #rther"ore, the interest

d#e sha$$ itse$ earn $e%a$ interest ro" the ti"e it is =#di&ia$$6 de"anded. Inthe asen&e o stip#$ation, the rate o interest sha$$ e ') per ann#" to

e &o"p#ted ro" dea#$t, i.e., ro" =#di&ia$ or e+tra=#di&ia$ de"and #nder

and s#=e&t to the proisions o Arti&$e ''3 o the Cii$ Code.('

7en&e, respondent is $ia$e or the pa6"ent o $e%a$ interest per  annum to

e &o"p#ted ro" Noe"er )', 'J, the date hen she re&eied

petitioners de"and $etter.() >ro" the ;na$it6 o the de&ision #nti$ it is #$$6

paid, the a"o#nt d#e sha$$ earn interest at ') per  annum, the interi"

period ein% dee"ed eF#ia$ent to a orearan&e o &redit.(1

 The aard o a&t#a$ da"a%es in the a"o#nt o PJ*,*** and P'**,***

attorne6s ees is de$eted sin&e the RTC de&ision did not e+p$ain the a&t#a$

ases or these da"a%es.

"#%R%FOR%, the petition is here6 (RANT%D and the #ne ', )**)

de&ision and A#%#st )*, )**) reso$#tion o the Co#rt o Appea$s in CA-/.R.

CV No. J3J22 are R%V%RS%D and S%T ASID%. The >er#ar6 )0, '2

de&ision o the Re%iona$ Tria$ Co#rt in Cii$ Case No. 3-)33

is AFFIRM%D ith the MODIFICATION that respondent is dire&ted to pa6

petitioner the a"o#nts o

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') per  annum #nti$ #$$6 paid. The aard o a&t#a$ da"a%es and

attorne6s ees is de$eted.

SO ORD%R%D&

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  S%COND DIVISION

 

 The heirs 4'5 o spo#ses Ca6etano and Cons#e$o Pan%an 8 petitioners-heirs9

see the reersa$ o the Co#rt o Appea$s 8CA9 de&ision4)5

 o #ne )3, )**),as e$$ its reso$#tion o >er#ar6 )*, )**1, in CA-/.R. CV Case No. J3J*

thro#%h the present petition or reie on certiorari.415  The CA de&ision

ar"ed the Re%iona$ Tria$ Co#rts 8RTC9 r#$in%4(5 hi&h %ranted the

&o"p$aint or spe&i;& peror"an&e ;$ed 6 spo#ses Ro%e$io and Pris&i$$a

Perreras 8respon!ents9 a%ainst the petitioners-heirs, and dis"issed the

&o"p$aint or &onsi%nation instit#ted 6 Cons#e$o Pan%an 8Consuelo9

a%ainst the respondents.

 

T#% FACT!A$ ANT%C%D%NTS

 

 The spo#ses Pan%an ere the oners o the $ot and to-door

apart"ent 8su()ect properties9 $o&ated at ''() CasaXas St. ,

Sa"pa$o&, Mani$a.4J5  On #ne ), '0, Cons#e$o a%reed to se$$ to the

respondents the s#=e&t properties or the pri&e o PJ(*,***.**. On the

sa"e da6, Cons#e$o re&eied P)*,***.** ro" the respondents as earnest

"one6, eiden&ed 6 a re&eipt 8 June *, &++ receipt 9435 that a$so in&$#ded

the ter"s o the parties a%ree"ent.

 Three da6s $ater, or on #ne J, '0, the parties a%reed to in&rease

the p#r&hase pri&e ro" PJ(*,***.** to PJ0*,***.**.

In &o"p$ian&e ith the a%ree"ent, the respondents iss#ed to >ar

East Ban and Tr#st Co"pan6 &he&s pa6a$e to Cons#e$o in the a"o#nts

o P)**,***.** andP)J*,***.** on June &, &++. Cons#e$o, hoeer,

re#sed to a&&ept the &he&s. She =#sti;ed her re#sa$ 6 sa6in% that her

&hi$dren 8the petitioners-heirs9 &o-oners o the s#=e&t properties did

not ant to se$$ the s#=e&t properties. >or the sa"e reason, Cons#e$o

oKered to ret#rn the P)*,***.** earnest "one6 she re&eied ro" the

respondents, #t the $atter re=e&ted it. Th#s, Cons#e$o ;$ed a &o"p$aint or

&onsi%nation a%ainst the respondents on Septe"er J, '0, do&eted as

Cii$ Case No. 0-J*)J0, eore the RTC o Mani$a, Bran&h )0.

 The respondents, ho insisted on enor&in% the a%ree"ent, in t#rn

instit#ted an a&tion or spe&i;& peror"an&e a%ainst Cons#e$o eore the

sa"e &o#rt on Septe"er )3, '0. This &ase as do&eted as Cii$ Case

#%IRS OF CA,%TANO PAN(AN an

CONS!%$O PAN(AN,!

  Petitioners,

- ers#s

SPO!S%S RO(%$IO P%RR%RAS an

PRISCI$$A P%RR%RAS,

  Respondents.

 

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No. 0-J*)J. The6 so#%ht to &o"pe$ Cons#e$o and the petitioners-heirs

8ho ere s#seF#ent$6 i"p$eaded as &o-deendants9 to e+ete a Deed o 

Aso$#te Sa$e oer the s#=e&t properties.

In her Anser, Cons#e$o &$ai"ed that she as =#sti;ed in a&in%

o#t ro" the a%ree"ent on the %ro#nd that the sa$e as s#=e&t to the

&onsent o the petitioners-heirs ho e&a"e &o-oners o the propert6

#pon the death o her h#sand, Ca6etano. Sin&e the petitioners-heirs

disapproed o the sa$e, Cons#e$o &$ai"ed that the &ontra&t e&a"e

ineKe&tie or $a& o the reF#isite &onsent. She neerthe$ess e+pressed

her i$$in%ness to ret#rn the P)*,***.** earnest "one6 she re&eied ro"

the respondents.

 

 The RTC r#$ed in the respondents aor it #phe$d the e+isten&e o a

pere&ted &ontra&t o sa$e, at $east insoar as the sa$e ino$ed Cons#e$os

&on=#%a$ and hereditar6 shares in the s#=e&t properties. The tria$ &o#rt

o#nd that Cons#e$os re&eipt o the P)*,***.** earnest "one6 as an

e$oF#ent "aniestation o the pere&tion o the &ontra&t. Moreoer,

nothin% in the #ne ), '0 re&eipt shoed that the a%ree"ent as

&onditioned on the &onsent o the petitioners-heirs. Een so, the RTC

de&$ared that the sa$e is a$id and &an e enor&ed a%ainst Cons#e$o as a

&o-oner, she had #$$-onership o the part pertainin% to her share hi&h

she &an a$ienate, assi%n, or "ort%a%e. The petitioners-heirs, hoeer,

&o#$d not e &o"pe$$ed to transer and de$ier their shares in the s#=e&t

properties, as the6 ere not parties to the a%ree"ent eteen Cons#e$o

and the respondents. Th#s, the tria$ &o#rt ordered Cons#e$o to &one6 one-

ha$ 8representin% Cons#e$os &on=#%a$ share9 p$#s one-si+th 8representin%

Cons#e$os hereditar6 share9 o the s#=e&t properties, and to

pa6 P'*,***.** as attorne6s ees to the respondents. Coro$$ari$6, it

dis"issed Cons#e$os &onsi%nation &o"p$aint.

 

Cons#e$o and the petitioners-heirs appea$ed the RTC de&ision to the

CA &$ai"in% that the tria$ &o#rt erred in not ;ndin% that the a%ree"ent as

s#=e&t to a s#spensie &ondition the &onsent o the petitioners-heirs to

the a%ree"ent. The CA, hoeer, reso$ed to dis"iss the appea$ and,

thereore, ar"ed the RTC de&ision. As the RTC did, the CA o#nd that the

pa6"ent and re&eipt o earnest "one6 as the operatie a&t that %ae rise

to a pere&ted &ontra&t, and that there as nothin% in the parties

a%ree"ent that o#$d indi&ate that it as s#=e&t to a s#spensie

&ondition. It de&$ared:

 

Nohere in the a%ree"ent o the parties, as &ontained in

the #ne ), '0 re&eipt iss#ed 6 4Cons#e$o5 +++,

indi&ates that 4Cons#e$o5 resered tit$ed on 4si&5 the

propert6, nor does it &ontain an6 proision s#=e&tin% thesa$e to a positie s#spensie &ondition.

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petitioners-heirs &onsent as &o-oners. The re#sa$ o the petitioners-

heirs to se$$ the s#=e&t properties p#rported$6 a"o#nted to the asen&e o 

the reF#isite e$e"ent o &onsent.

Een ass#"in% that the a%ree"ent a"o#nted to a pere&ted

&ontra&t, the petitioners-heirs posed the F#estion o the a%ree"ents

proper &hara&teri?ation hether it is acontract of sale or a contract tosell. The petitioners-heirs posit that the a%ree"ent ino$es a &ontra&t to

se$$, and the respondents belated  pa6"ent o part o the p#r&hase

pri&e,i.e., one da6 ater the #ne '(, '0 d#e date, a"o#nted to the non-

#$;$$"ent o a positie s#spensie &ondition that preented the &ontra&t

ro" a&F#irin% o$i%ator6 or&e. In s#pport o this &ontention, the

petitioners-heirs &ite the Co#rts r#$in% in the &ase o A!elfa Rivera, et al. v.

i!ela !el Rosario, et al.: 425

 

In a &ontra&t o sa$e, the tit$e to the propert6

passes to the endee #pon the de$ier6 o the thin% so$d

hi$e in a &ontra&t to se$$, onership is, 6 a%ree"ent,

resered in the endor and is not to pass to the endee

#nti$ #$$ pa6"ent o the p#r&hase pri&e. In a contract to

sell' the pa;ment of the purchase price is a positi6e

suspensi6e conition' the failure of 5hich is not a

breach' casual or serious' but a situation that

pre6ents the obli7ation of the 6enor to con6e; title

from acuirin7 an obli7ator; force&

4Riera5, hoeer, ai$ed to &o"p$ete pa6"ent o 

the se&ond insta$$"ent. The non-#$;$$"ent o the &ondition

rendered the &ontra&t to se$$ ineKe&tie and itho#t or&e

and eKe&t. 4E"phasis in the ori%ina$.5

 

>ro" these &ontentions, e si"p$i6 the asi& iss#es or reso$#tion to

three F#estions:

 

.&  "as there a perfecte contract bet5een the parties

=&  "hat is the nature of the contract bet5een them an

0&  "hat is the eEect of the responents9 belate pa;ment on

their contract

 

T#% CO!RT9S R!$IN(

 

There was a perfected 

contract between the parties since all the

essential requisites of a

contract were present 

 

Arti&$e '1'0 o the Cii$ Code de&$ares that no &ontra&t e+ists #n$ess

the o$$oin% reF#isites &onr: 8'9 &onsent o the &ontra&tin%

parties 8)9 o=e&t &ertain hi&h is the s#=e&t "atter o the &ontra&t

and 819 &a#se o the o$i%ation esta$ished. Sin&e the o=e&t o the parties

a%ree"ent ino$es properties &o-oned 6 Cons#e$o and her &hi$dren, the

petitioners-heirs insist that their approa$ o the sa$e initiated 6 their

"other, Cons#e$o, as essentia$ to its pere&tion. A&&ordin%$6, their re#sa$

a"o#nted to the asen&e o the reF#ired e$e"ent o &onsent.

 That a thin% is so$d itho#t the &onsent o a$$ the &o-oners does not

ina$idate the sa$e or render it oid. Arti&$e (1 o the Cii$

Code405 re&o%ni?es the aso$#te ri%ht o a &o-oner to ree$6 dispose o 

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his pro in!iviso share as e$$ as the r#its and other ene;ts arisin% ro"

that share, independent$6 o the other &o-oners. Th#s, hen Cons#e$o

a%reed to se$$ to the respondents the s#=e&t properties, hat she in a&t

so$d as her #ndiided interest that, as F#anti;ed 6 the RTC, &onsisted o 

one-ha$ interest, representin% her &on=#%a$ share, and one-si+th interest,

representin% her hereditar6 share.

 

 The petitioners-heirs neerthe$ess ar%#e that Cons#e$os &onsent

as predi&ated on their &onsent to the sa$e, and that their disapproa$

res#$ted in the ithdraa$ o Cons#e$os &onsent. et, e ;nd nothin% in

the parties a%ree"ent or een &ond#&t sae Cons#e$os se$-serin%

testi"on6 that o#$d indi&ate or ro" hi&h e &an iner that Cons#e$os

&onsent depended on her &hi$drens approa$ o the sa$e. The e+p$i&it

ter"s o the #ne 0, '0 re&eipt45

 proide no o&&asion or an6 readin%that the a%ree"ent is s#=e&t to the petitioners-heirs aora$e &onsent to

the sa$e.

 The presen&e o Cons#e$os &onsent and, &oro$$ari$6, the e+isten&e

o a pere&ted &ontra&t eteen the parties are #rther eiden&ed 6 the

pa6"ent and re&eipt oP)*,***.**, an earnest "one6 6 the &ontra&tin%

parties &o""on #sa%e. The $a on sa$es, spe&i;&a$$6 Arti&$e '(0) o the

Cii$ Code, proides that whenever earnest money is given in a

contract of sale, it shall be considered as part of the price and 

 proof of the perfection of the contract. A$tho#%h the pres#"ption is

not &on&$#sie, as the parties "a6 treat the earnest "one6 diKerent$6,

there is nothin% a$$e%ed in the present &ase that o#$d %ie rise to a

&ontrar6 pres#"ption. In &ases here the Co#rt rea&hed a &on&$#sion

&ontrar6 to the pres#"ption de&$ared in Arti&$e '(0), e o#nd that the

"one6 initia$$6 paid as %ien to guarantee that the (uer %oul! not (ack 

out from the sale, &onsiderin% that the parties to the sale have et to

arrive at a !e/nite agreement as to its terms 0 that is, a situation %here

the contract has not et (een perfecte! .4'*5  These sit#ations do not otain

in the present &ase, as neither o the parties &$ai"ed that the P)*,***.**

as %ien "ere$6 as %#arantee 6 the respondents, as endees, that the6

o#$d not a& o#t ro" the sa$e. As e hae pointed o#t, the ter"s o 

the parties a%ree"ent are &$ear and e+p$i&it indeed, a$$ the essentia$

e$e"ents o a pere&ted &ontra&t are present in this &ase. hi$e the

respondents reF#ired that the o&pants a&ate the s#=e&t properties

prior to the pa6"ent o the se&ond insta$$"ent, the stip#$ation does not

aKe&t the pere&tion o the &ontra&t, #t on$6 its e+etion.

In s#", the &ase &ontains no e$e"ent, a&t#a$ or $e%a$, that ne%ates

the e+isten&e o a pere&ted &ontra&t eteen the parties.

The characterization of 

the contract can be

considered irrelevant in

this case in light of 

 Article 1!" and the

#aceda $aw, and the

 petitioners%heirs&

 payment 

 

 The petitioners-heirs posit that the proper &hara&teri?ation o the

&ontra&t entered into 6 the parties is si%ni;&ant in order to deter"ine the

eKe&t o the respondents rea&h o the &ontra&t 8hi&h p#rported$6

&onsisted o a one-da6 de$a6 in the pa6"ent o part o the p#r&hase pri&e9

and the re"edies to hi&h the6, as the non-dea#$tin% part6, are entit$ed.

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  The F#estion o &hara&teri?ation o the &ontra&t ino$ed here o#$d

ne&essari$6 &a$$ or a thoro#%h ana$6sis o the parties a%ree"ent as

e"odied in the #ne ), '0re&eipt, their &onte"poraneo#s a&ts, and the

&ir"stan&es s#rro#ndin% the &ontra&ts pere&tion and

e+etion. !nfortunatel;' the lo5er courts9 factual 8nin7s pro6ie

insucient etail for the purpose& A stip#$ation reserin% onership

in the endor #nti$ #$$ pa6"ent o the pri&e is, #nder &ase $a, t6pi&a$ in a

&ontra&t to se$$.4''5  In this &ase, the endor "ade no reseration on the

onership o the s#=e&t properties. >ro" this perspe&tie, the parties

a%ree"ent "a6 e &onsidered a contract of sale. On the other hand,

 =#rispr#den&e has si"i$ar$6 esta$ished that the need to e+ete a deed o 

aso$#te sa$e #pon &o"p$etion o pa6"ent o the pri&e %enera$$6 indi&ates

that it is a &ontra&t to se$$, as it i"p$ies the reseration o tit$e in the

endor #nti$ the endee has &o"p$eted the pa6"ent o the pri&e. hen

the respondents instit#ted the a&tion or spe&i;& peror"an&e eore theRTC, the6 pra6ed that Cons#e$o e ordered to e+ete a Deed o Aso$#te

Sa$e this a&t "a6 e taen to &on&$#de that the parties on$6 entered into

acontract to sell.

Ad"itted$6, the %ien a&ts, as o#nd 6 the $oer &o#rts, and in

the asen&e o additiona$ detai$s, &an e interpreted to s#pport to

&oni&tin% &on&$#sions. The ai$#re o the $oer &o#rts to pr6 into these

"atters "a6 #nderstanda$6 e e+p$ained 6 the iss#es raised eore

the", hi&h did not reF#ire the additiona$ detai$s. Th#s, the6 o#nd the

F#estion o the &ontra&ts &hara&teri?ation i""ateria$ in their disssion

o the a&ts and the $a o the &ase. Besides, the petitioners-heirs raised

the F#estion o the &ontra&ts &hara&teri?ation and the eKe&t o the

rea&h for the /rst time thro#%h the present R#$e (J petition.

Points o $a, theories, iss#es and ar%#"ents not ro#%ht to the

attention o the $oer &o#rt need not e, and ordinari$6 i$$ not e,

&onsidered 6 the reiein% &o#rt, as the6 &annot e raised or the ;rst

ti"e at the appe$$ate reie sta%e. Basi& &onsiderations o airness and

d#e pro&ess reF#ire this r#$e. 4')5

 

At an6 rate, e do not ;nd the F#estion o &hara&teri?ation

si%ni;&ant to #$$6 pass #pon the F#estion o dea#$t d#e to the

respondents rea&h #$ti"ate$6, the rea&h as red and the &ontra&t

reied 6 the respondents pa6"ent a da6 ater the d#e date.

In cases of breach ue to nonpa;ment' the 6enor ma;

a6ail of the reme; of rescission in a contract of sale. Neerthe$ess,the dea#$tin% endee "a6 deeat the endors ri%ht to res&ind the

&ontra&t o sa$e i he pa6s the a"o#nt d#e eore he re&eies a de"and or

res&ission, either =#di&ia$$6 or 6 a notaria$ a&t, ro" the endor. This ri%ht

is proided #nder Arti&$e 'J) o the Cii$ Code:

 

Arti&$e 'J). In the sa$e o i""oa$e propert6,

een tho#%h it "a6 hae een stip#$ated that #pon ai$#re

to pa6 the pri&e at the ti"e a%reed #pon the res&ission o 

the &ontra&t sha$$ o ri%ht tae p$a&e, the 6enee ma;pa;' e6en after the e:piration of the perio' as lon7

as no eman for rescission of the contract has

been mae upon him either Buiciall; or b; a

notarial act& Ater the de"and, the &o#rt "a6 not %rant

hi" a ne ter". 4E"phasis s#pp$ied.5

 

Nonpa;ment of the purchase price in contracts to sell ,

hoeer, does not &onstit#te a rea&h rather, nonpa6"ent is a &ondition

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that preents the o$i%ation ro" a&F#irin% o$i%ator6 or&e and results in

its cancellation. e stated in 1ng v. CA4'15 that:

 

In a contract to sell' the pa;ment of the

purchase price is a positi6e suspensi6e conition'

the failure of 5hich is not a breach' casual or

serious' but a situation that pre6ents the obli7ationof the 6enor to con6e; title from acuirin7

obli7ator; force&  The non-#$;$$"ent o the &ondition o 

#$$ pa6"ent rendered the &ontra&t to se$$ ineKe&tie and

itho#t or&e and eKe&t. 4E"phasis s#pp$ied.5

 

As in the res&ission o a &ontra&t o sa$e or nonpa6"ent o the

pri&e, the dea#$tin% endee in a &ontra&t to se$$ "a6 deeat the endors

ri%ht to &an&e$ 6 inoin% the ri%hts %ranted to hi" #nder Rep#$i& A&t No.

3JJ) or the Rea$t6 Insta$$"ent B#6er Prote&tion A&t 8a$so non as

the $ace!a 2a%9 this $a proides or a 3*-da6 %ra&e period ithin hi&h

the dea#$tin% endee 8ho has paid $ess than to 6ears o insta$$"ents9

"a6 sti$$ pa6 the insta$$"ents d#e. On$6 ater the $apse o the %ra&e period

ith &ontin#ed nonpa6"ent o the a"o#nts d#e &an the a&t#a$

&an&e$$ation o the &ontra&t tae p$a&e. The pertinent proisions o the

Ma&eda La proide:

++++

 

Se&tion ). It is here6 de&$ared a p#$i& po$i&6 to

prote&t #6ers o rea$ estate on insta$$"ent pa6"ents

a%ainst onero#s and oppressie &onditions.

 

Se&. 1. In all transactions or contracts

in6ol6in7 the sale or 8nancin7 of real estate oninstallment pa;ments, in&$#din% residentia$

&ondo"ini#" apart"ents #t e+&$#din% ind#stria$ $ots,

&o""er&ia$ #i$din%s and sa$es to tenants #nder Rep#$i&

A&t N#"ered Thirt6-ei%ht h#ndred ort6-o#r as a"ended

6 Rep#$i& A&t N#"ered Si+t6-three h#ndred ei%ht6-nine,

here the #6er has paid at $east to 6ears o 

insta$$"ents, the #6er is entit$ed to the o$$oin% ri%hts in

&ase he dea#$ts in the pa6"ent o s#&&eedin%

insta$$"ents:

 

++++

 

Se&tion (. In case 5here less than t5o ;ears

of installments 5ere pai' the seller shall 7i6e the

bu;er a 7race perio of not less than 3> a;s from

the ate the installment became ue& I the #6er

ai$s to pa6 the insta$$"ents d#e at the e+piration o the

%ra&e period, the se$$er "a6 &an&e$ the &ontra&t ater thirt6

da6s ro" the re&eipt 6 the #6er o the noti&e o 

&an&e$$ation or the de"and or res&ission o the &ontra&t 6

notaria$ a&t. 4E"phasis s#pp$ied.5

 

Si%ni;&ant$6, the Co#rt has &onsistent$6 he$d that the Ma&eda La

&oers not on$6 sa$es on insta$$"ents o rea$ estate, #t a$so ;nan&in% o 

s#&h a&F#isition its Se&tion 1 is &o"prehensie eno#%h to in&$#de oth

&ontra&ts o sa$e and &ontra&ts to se$$, proided that the ter"s on pa6"ent

o the pri&e reF#ire at $east to insta$$"ents. The &ontra&t entered into 6

the parties herein &an er6 e$$ a$$ #nder the Ma&eda La.

 

Based on the aoe disssion, e &on&$#de that the respondents

pa6"ent on #ne 'J, '0 o the insta$$"ent d#e on #ne '(,

'0 eKe&tie$6 deeated the petitioners-heirs ri%ht to hae the &ontra&t

res&inded or &an&e$$ed. hether the parties a%ree"ent is &hara&teri?ed

as one of sale or to sell is not re$eant in $i%ht o the respondents pa6"ent

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ithin the %ra&e period proided #nder Arti&$e 'J) o the Cii$ Code and

Se&tion ( o the Ma&eda La. The petitioners-heirs o$i%ation to a&&ept

the pa6"ent o the pri&e and to &one6 Cons#e$os &on=#%a$ and hereditar6

shares in the s#=e&t properties s#sists.

"#%R%FOR%, e D%N,   the petitioners-heirs petition or reie

on certiorari, and AFFIRM the de&ision o the Co#rt o Appea$s dated #ne

)(, )**) and its reso$#tion dated >er#ar6 )*, )**1 in CA-/.R. CV Case No.

J3J*. Costs a%ainst the petitioners-heirs.

 

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Rep#$i& o the Phi$ippines

S!PR%M% CO!RT

Mani$a

SECOND DIVISION

(&R& No& .=2>33 +une .G' =>>>

 +ARDIN% DAVI%S INC&' petitioner,s.

CO!RT OF APP%A$S an FAR %AST MI$$S S!PP$, 

CORPORATION'  respondents.

+ - - - - - - - - - - - - - - - - - - - - - - -+

(&R& No& .=2>3G

P!R% FOODS CORPORATION' petitioner,

s.

CO!RT OF APP%A$S an FAR %AST MI$$S S!PP$, CORPORATION'  respondents.

%$$OSI$$O' J&4

 This is rather a si"p$e &ase or spe&i;& peror"an&e ith da"a%es hi&h

&o#$d hae een reso$ed thro#%h "ediation and &on&i$iation d#rin% its

inan&6 sta%e had the parties een earnest in e+peditin% the disposa$ o 

this &ase. The6 opted hoeer to resort to #$$ &o#rt pro&eedin%s and

denied the"se$es the ene;ts o a$ternatie disp#te reso$#tion, th#s

"ain% the pro&ess "ore ard#o#s and $on%-dran.

 The &ontroers6 started in ') at the hei%ht o the poer &risis hi&h the

&o#ntr6 as then e+perien&in%. To re"ed6 and rtai$ #rther $osses d#e to

the series o poer ai$#res, petitioner POODS CORPORATION

8hereater POODS9 de&ided to insta$$ to 8)9 'J** %enerators in

its ood pro&essin% p$ant in San RoF#e, Mariina Cit6.

So"eti"e in Noe"er ') a iddin% or the s#pp$6 and insta$$ation o 

the %enerators as he$d. Seera$ s#pp$iers and dea$ers ere inited to

attend a pre-iddin% &oneren&e to disss the &onditions, propose s&he"e

and spe&i;&ations that o#$d est s#it the needs o POODS. O#t o 

the ei%ht 809 prospe&tie idders ho attended the pre-iddin% &oneren&e,on$6 three 819 idders, na"e$6, respondent >AR EAST MILLS SEMSCO9, MONAR and ADVANCE POER

s#"itted id proposa$s and %ae id onds eF#ia$ent to J o their

respe&tie ids, as reF#ired.

 Thereater, in a $etter dated ') De&e"er ') addressed to >EMSCO

President A$onso Po, POODS &on;r"ed the aard o the &ontra&t to

>EMSCO U

/ent$e"en:

 This i$$ &on;r" that P#re >oods Corporation has aarded to 6o#r ;r" the

pro=e&t: S#pp$6 and Insta$$ation o to 8)9 #nits o 'J** Y#nit /enerator

Sets at the Pro&essed Meats P$ant, Bo. San RoF#e, Mariina, ased on 6o#r

proposa$ n#"er PC )0-) dated Noe"er )*, '), s#=e&t to the

o$$oin% asi& ter"s and &onditions:

'. L#"p s#" &ontra&t o P3,'12,)1.** 8VAT in&$#ded9, or the

s#pp$6 o "ateria$s and $aor or the $o&a$ portion and the $aor or

the i"ported "ateria$s, pa6a$e 6 pro%ress i$$in% ti&e a "onth,

ith ten per&ent 8'*9 retention. The retained a"o#nt sha$$ ere$eased thirt6 81*9 da6s ater a&&eptan&e o the &o"p$eted pro=e&t

and #pon postin% o /#arantee Bond in an a"o#nt eF#ia$ent to

tent6 per&ent 8)*9 o the &ontra&t pri&e. The /#arantee Bond

sha$$ e a$id or one 8'9 6ear ro" &o"p$etion and a&&eptan&e o 

pro=e&t. The &ontra&t pri&e in&$#des #t#re in&reaseYs in &osts o 

"ateria$s and $aor

). The pro=e&ts sha$$ e #ndertaen p#rs#ant to the atta&hed

spe&i;&ations. It is #nderstood that an6 ite" reF#ired to &o"p$ete

the pro=e&t, and those not in&$#ded in the $ist o ite"s sha$$ e

dee"ed in&$#ded and &oered and sha$$ e peror"ed

1. A$$ "ateria$s sha$$ e rand ne

(. The pro=e&t sha$$ &o""en&e i""ediate$6 and "#st e

&o"p$eted ithin tent6 8)*9 orin% da6s ater the de$ier6 o 

/enerator Set to Mariina P$ant, pena$t6 eF#ia$ent to 'Y'* o '

o the p#r&hase pri&e or eer6 da6 o de$a6

J. The Contra&tor sha$$ p#t #p Peror"an&e Bond eF#ia$ent to

thirt6 81*9 o the &ontra&t pri&e, and sha$$ prore A$$ Ris

Ins#ran&e eF#ia$ent to the &ontra&t pri&e #pon &o""en&e"ent o 

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the pro=e&t. The A$$ Ris Ins#ran&e Po$i&6 sha$$ e endorsed in aor

o and sha$$ e de$iered to P#re >oods Corporation

3. arrant6 o one 8'9 6ear a%ainst dee&tie "ateria$ andYor

or"anship.

On&e ;na$i?ed, e sha$$ as 6o# to si%n the or"a$ &ontra&t e"od6in% the

ore%oin% ter"s and &onditions.

I""ediate$6, >EMSCO s#"itted the reF#ired peror"an&e ond in the

a"o#nt o P',0(','02.* and &ontra&tors a$$-ris ins#ran&e po$i&6 in the

a"o#nt o P3,'12,)1.** hi&h POODS thro#%h its Vi&e President

Benedi&to /. Tope a&no$ed%ed in a $etter dated '0 De&e"er ').

>EMSCO a$so "ade arran%e"ents ith its prin&ipa$ and started the

POODS pro=e&t 6 p#r&hasin% the ne&essar6 "ateria$s. POODS

on the other hand ret#rned >EMSCOs Bidders Bond in the a"o#nt o 

P',***,***.**, as reF#ested.

Later, hoeer, in a $etter dated )) De&e"er '), POODS thro#%h

its Senior Vi&e President Teodoro L. Di"a6#%a #ni$atera$$6 &an&e$ed theaard as Wsi%ni;&ant a&tors ere #n&oered and ro#%ht to 8their9

attention hi&h di&tate 8the9 &an&e$$ation and arrant a tota$ reie and

re-id o 8the9 pro=e&t.W ConseF#ent$6, >EMSCO protested the &an&e$$ation

o the aard and so#%ht a "eetin% ith POODS. 7oeer, on )3

Mar&h '1, eore the "atter &o#$d e reso$ed, POODS a$read6

aarded the pro=e&t and entered into a &ontra&t ith ARDINE NELL, a

diision o ardine Daies, In&. 8hereater ARDINE9, hi&h in&identa$$6 as

not one o the idders.&3%phi&.n4t 

>EMSCO th#s rote POODS to honor its &ontra&t ith the or"er, and

to ARDINE to &ease and desist ro" de$ierin% and insta$$in% the to 8)9

%enerators at POODS. Its de"and $etters #nheeded, >EMSCO s#ed

oth POODS and ARDINE: POODS or rene%in% on its &ontra&t,

and ARDINE or its #narranted intereren&e and ind#&e"ent. Tria$

ens#ed. Ater >EMSCO presented its eiden&e, ARDINE ;$ed a De"#rrer to

Eiden&e.

On )2 #ne '( the Re%iona$ Tria$ Co#rt o Pasi%, Br. 30, ' %ranted

 ARDINEs De"#rrer to Eiden&e. The tria$ &o#rt &on&$#ded that W45hi$e it

"a6 see" to the p$aintiK that 6 the a&tions o the to deendants there is

so"ethin% #nderhanded %oin% on, this is a$$ a "atter o per&eption, and

#ns#pported 6 hard eiden&e, "ere s#spi&ions and s#ppositions o#$d

not stand #p er6 e$$ in a &o#rt o $a.W ) Meanhi$e tria$ pro&eeded as

re%ards the &ase a%ainst POODS.

On )0 #$6 '( the tria$ &o#rt rendered a de&ision orderin% POODS:

8a9 to inde"ni6 >EMSCO the s#" o P),1**,***.** representin% the a$#e

o en%ineerin% seri&es it rendered 89 to pa6 >EMSCO the s#" o 

EMSCO.

On '( A#%#st '3 the Co#rt o Appea$s ar"ed in toto the )0 #$6 '(

De&ision o the tria$ &o#rt. 1 It a$so reersed the )2 #ne '( Reso$#tion o 

the $oer &o#rt and ordered ARDINE to pa6 >EMSCO da"a%es or ind#&in%

POODS to io$ate the $atters &ontra&t ith >EMSCO. As s#&h, ARDINE

as ordered to pa6 >EMSCO P),***,***.** or "ora$ da"a%es. In addition,

POODS as a$so dire&ted to pa6 >EMSCO P),***,***.** as "ora$

da"a%es and P',***,***.** as e+e"p$ar6 da"a%es as e$$ as )* o the

tota$ a"o#nt d#e as attorne6s ees.

On 1' an#ar6 '2 the Co#rt o Appea$s denied or $a& o "erit the

separate "otions or re&onsideration ;$ed 6 POODS and ARDINE.7en&e, these to 8)9 petitions or reie ;$ed 6 POODS and ARDINE

hi&h ere s#seF#ent$6 &onso$idated.

POODS "aintains that the &on&$#sions o oth the tria$ &o#rt and the

appe$$ate &o#rt are pre"ised on a "isapprehension o a&ts. It ar%#es that

its ') De&e"er ') $etter to >EMSCO as not an a&&eptan&e o the

$atters id proposa$ and aard o the pro=e&t #t "ore o a F#a$i;ed

a&&eptan&e &onstit#tin% a &o#nter-oKer hi&h reF#ired >EMSCOs

e+press conforme. Sin&e POODS neer re&eied >EMSCOs conforme,

POODS as er6 e$$ ithin reason to reoe its F#a$i;ed a&&eptan&e

or &o#nter-oKer. 7en&e, no &ontra&t as pere&ted eteen POODSand >EMSCO. POODS a$so &ontends that it as neer in ad aith

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hen it dea$t ith >EMSCO. 7en&e "ora$ and e+e"p$ar6 da"a%es sho#$d

not hae een aarded.

Coro$$ari$6, ARDINE asserts that the re&ords are eret o an6 shoin% that

it had prior no$ed%e o the s#pposed &ontra&t eteen POODS and

>EMSCO, and that it ind#&ed POODS to io$ate the $atters a$$e%ed

&ontra&t ith >EMSCO. Moreoer, ARDINE reasons that >EMSCO, an

arti;&ia$ person, is not entit$ed to "ora$ da"a%es. B#t

%rantin% arguen!o that the aard o "ora$ da"a%es is proper,P),***,***.** is e+tre"e$6 e+&essie.

In the "ain, these &onso$idated &ases present to 8)9 iss#es: ;rst, hether

there e+isted a pere&ted &ontra&t eteen POODS and >EMSCO and

se&ond, %rantin% there e+isted a pere&ted &ontra&t, hether there is an6

shoin% that ARDINE ind#&ed or &onnied ith POODS to io$ate the

$atters &ontra&t ith >EMSCO.

A &ontra&t is de;ned as Wa =#ridi&a$ &onention "aniested in $e%a$ or", 6

irt#e o hi&h one or "ore persons ind the"se$es in aor o another or

others, or re&ipro&a$$6, to the #$;$$"ent o a prestation to %ie, to do, or

not to do.W (  There &an e no &ontra&t #n$ess the o$$oin% reF#isites

&onr: 8a9 &onsent o the &ontra&tin% parties 89 o=e&t &ertain hi&h is

the s#=e&t "atter o the &ontra&t and, 8&9 &a#se o the o$i%ation hi&h is

esta$ished.J A &ontra&t inds oth &ontra&tin% parties and has the or&e o 

$a eteen the".

Contra&ts are pere&ted 6 "ere &onsent, #pon the a&&eptan&e 6 the

oKeree o the oKer "ade 6 the oKeror. >ro" that "o"ent, the parties are

o#nd not on$6 to the #$;$$"ent o hat has een e+press$6 stip#$ated #t

a$so to a$$ the &onseF#en&es hi&h, a&&ordin% to their nat#re, "a6 e in

eepin% ith %ood aith, #sa%e and $a. 3 To prod#&e a &ontra&t, the

a&&eptan&e "#st not F#a$i6 the ter"s o the oKer. 7oeer, thea&&eptan&e "a6 e e+press or i"p$ied. 2 >or a &ontra&t to arise, the

a&&eptan&e "#st e "ade non to the oKeror. A&&ordin%$6, the

a&&eptan&e &an e ithdran or reoed eore it is "ade non to the

oKeror.

In the instant &ase, there is no iss#e as re%ards the s#=e&t "atter o the

&ontra&t and the &a#se o the o$i%ation. The &ontroers6 $ies in the

&onsent U hether there as an a&&eptan&e o the oKer, and i so, i it as

&o""#ni&ated, there6 pere&tin% the &ontra&t.

 To reso$e the disp#te, there is a need to deter"ine hat &onstit#ted the

oKer and the a&&eptan&e. Sin&e petitioner POODS started the pro&ess

o enterin% into the &ontra&t 6 &ond#&tin% a iddin%, Art. '1)3 o the Cii$

Code, hi&h proides that W4a5dertise"ents or idders are si"p$6

initations to "ae proposa$s,W app$ies. A&&ordin%$6, the Ter"s and

Conditions o the Biddin% disse"inated 6 petitioner POODS

&onstit#tes the Wadertise"entW to id on the pro=e&t. The id proposa$s or

F#otations s#"itted 6 the prospe&tie s#pp$iers in&$#din% respondent

>EMSCO, are the oKers. And, the rep$6 o petitioner POODS, thea&&eptan&e or re=e&tion o the respe&tie oKers.

H#ite oio#s$6, the ') De&e"er ') $etter o petitioner. POODS to

>EMSCO &onstit#ted a&&eptan&e o respondent >EMSCOs oKer as

&onte"p$ated 6 $a. The tenor o the $etter, i.e., WThis i$$ &on;r" that

P#re >oods has aarded to 6o#r ;r" 8>EMSCO9 the pro=e&t,W &o#$d not e

"ore &ate%ori&a$. hi$e the sa"e $etter en#"erated &ertain Wasi& ter"s

and &onditions,W these &onditions ere i"posed on the peror"an&e o the

o$i%ation rather than on the pere&tion o the &ontra&t. Th#s, the ;rst

W&onditionW as "ere$6 a reiteration o the &ontra&t pri&e and i$$in%

s&he"e ased on the Ter"s and Conditions o Biddin% and the id or

preio#s oKer o respondent >EMSCO. The se&ond and third W&onditionsWere nothin% "ore than %enera$ state"ents that a$$ ite"s and "ateria$s

in&$#din% those e+&$#ded in the $ist #t ne&essar6 to &o"p$ete the pro=e&t

sha$$ e dee"ed in&$#ded and sho#$d e rand ne. The o#rth W&onditionW

&on&erned the &o"p$etion o the or to e done, i.e., ithin tent6 8)*9

da6s ro" the de$ier6 o the %enerator set, the p#r&hase o hi&h as part

o the &ontra&t. The ;th W&onditionW had to do ith the p#ttin% #p o a

peror"an&e ond and an a$$-ris ins#ran&e, oth o hi&h sho#$d e %ien

#pon &o""en&e"ent o the pro=e&t. The si+th W&onditionW re$ated to the

standard arrant6 o one 8'9 6ear. In ;ne, the en#"erated Wasi& ter"s

and &onditionsW ere pres&riptions on ho the o$i%ation as to e

peror"ed and i"p$e"ented. The6 ere ar ro" ein% &onditions i"posedon the pere&tion o the &ontra&t.

In Ba(asa v . Court of Appeals 0 e distin%#ished eteen a &ondition

i"posed on the pere&tion o a &ontra&t and a &ondition i"posed "ere$6 on

the peror"an&e o an o$i%ation. hi$e ai$#re to &o"p$6 ith the ;rst

&ondition res#$ts in the ai$#re o a &ontra&t, ai$#re to &o"p$6 ith the

se&ond "ere$6 %ies the other part6 options andYor re"edies to prote&t his

interests.

e th#s a%ree ith the &on&$#sion o respondent appe$$ate &o#rt hi&h

ar"ed the tria$ &o#rt U

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CORPORATION P),***,***.** as "ora$ da"a%es is REVERSED and

SET ASIDE or ins#&ien&6 o eiden&e and

89 The petition in /.R. No. ')0*3 is DENIED. The assai$ed

De&ision o the Co#rt o Appea$s orderin% petitioner POODS

CORPORATION to pa6 priate respondent >AR EAST MILLS S

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?(&R& No& .0/=G>& +ul; 0.' =>>>@

SAN MI(!%$ PROP%RTI%S P#I$IPPIN%S' INC&' petitioner,

vs. SPO!S%S A$FR%DO #!AN( an (RAC% #!AN(' respondents.

D % C I S I O N

M%NDO)A' J&4

 This is a petition or reie o the de&ision,4'5 dated Apri$ 0, '2, o the

Co#rt o Appea$s hi&h reersed the de&ision o the Re%iona$ Tria$ Co#rt,

Bran&h 'J1, Pasi% Cit6 dis"issin% the &o"p$aint ro#%ht 6 respondents

a%ainst petitioner or enor&e"ent o a &ontra&t o sa$e.

 The a&ts are not in disp#te.

Petitioner San Mi%#e$ Properties Phi$ippines, In&. is a do"esti& &orporation

en%a%ed in the p#r&hase and sa$e o rea$ properties. Part o its inentor6

are to par&e$s o $and tota$$in% ', 210 sF#are "eters at the &orner o 

Mera$&o Aen#e and /enera$ Capinpin Street, Barrio Orano, Pasi% Cit6,hi&h are &oered 6 TCT Nos. PT-0)1J and PT-0)13 o the Re%ister o 

Deeds o Pasi% Cit6.

On >er#ar6 )', '(, the properties ere oKered or sa$e

or PJ),'(*,***.** in &ash. The oKer as "ade to Att6. 7e$ena M. Da#?

ho as a&tin% or respondent spo#ses as #ndis&$osed prin&ipa$s. In a

$etter4)5 dated Mar&h )(, '(, Att6. Da#? si%ni;ed her &$ients interest in

p#r&hasin% the properties or the a"o#nt or hi&h the6 ere oKered 6

petitioner, #nder the o$$oin% ter"s: the s#" o PJ**,***.** o#$d e

%ien as earnest "one6 and the a$an&e o#$d e paid in ei%ht eF#a$

"onth$6 insta$$"ents ro" Ma6 to De&e"er, '(. 7oeer, petitionerre#sed the &o#nter-oKer.

On Mar&h ), '(, Att6. Da#? rote another $etter415 proposin% the

o$$oin% ter"s or the p#r&hase o the properties, vi"5

 This is to e+press o#r interest to #6 6o#r-aoe-"entioned

propert6 ith an area o ', 210 sF. "eters. >or this

p#rpose, e are en&$osin% hereith the s#"

o P',***,***.** representin% earnest-deposit "one6,

s#=e&t to the o$$oin% &onditions.

'. e i$$ e %ien the e+&$#sie option to p#r&hase the

propert6 ithin the 1* da6s ro" date o 6o#r a&&eptan&e

o this oKer.

). D#rin% said period, e i$$ ne%otiate on the ter"s and

&onditions o the p#r&hase SMPPI i$$ sere the ne&essar6

Mana%e"ent and Board approa$s and e initiate the

do"entation i there is "#t#a$ a%ree"ent eteen #s.

1. In the eent that e do not &o"e to an a%ree"ent on

this transa&tion, the said a"o#nt o P',***,***.** sha$$ e

re#nda$e to #s in #$$ #pon de"and. . . .

Isidro A. Sore&are6, petitioners i&e-president and operations "ana%er

or &orporate rea$ estate, indi&ated his &onor"it6 to the oKer 6 a+in%

his si%nat#re to the $etter and a&&epted the Wearnest-depositW o P' "i$$ion.

ederi&o /on?a$es, rote Att6. Da#? inor"in% her that e&a#se the

parties ai$ed to a%ree on the ter"s and &onditions o the sa$e despite the

e+tension %ranted 6 petitioner, the $atter as ret#rnin% the a"o#nt o P'

"i$$ion %ien as Wearnest-deposit.W4J5

On #$6 )*, '(, respondent spo#ses, thro#%h &o#nse$, rote petitioner

de"andin% the e+etion ithin ;e da6s o a deed o sa$e &oerin% the

properties. Respondents atte"pted to ret#rn the Wearnest-depositW #t

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petitioner re#sed on the %ro#nd that respondents option to p#r&hase had

a$read6 e+pired.

On A#%#st '3, '(, respondent spo#ses ;$ed a &o"p$aint or spe&i;&

peror"an&e a%ainst petitioner eore the Re%iona$ Tria$ Co#rt, Bran&h '11,

Pasi% Cit6 here it as do&eted as Cii$ Case No. 3(33*.

ithin the period or ;$in% a responsie p$eadin%, petitioner ;$ed a "otion

to dis"iss the &o"p$aint a$$e%in% that 8'9 the a$$e%ed We+&$#sie optionW o respondent spo#ses $a&ed a &onsideration separate and distin&t ro" the

p#r&hase pri&e and as th#s #nenor&ea$e and 8)9 the &o"p$aint did not

a$$e%e a &a#se o a&tion e&a#se there as no W"eetin% o the "indsW

eteen the parties and, thereore, no pere&ted &ontra&t o sa$e. The

"otion as opposed 6 respondents.

On De&e"er '), '(, the tria$ &o#rt %ranted petitioners "otion and

dis"issed the a&tion. Respondents ;$ed a "otion or re&onsideration, #t it

as denied 6 the tria$ &o#rt. The6 then appea$ed to the Co#rt o Appea$s

hi&h, on Apri$ 0, '2, rendered a de&ision 435 reersin% the =#d%"ent o 

the tria$ &o#rt. The appe$$ate &o#rt he$d that a$$ the reF#isites o a

pere&ted &ontra&t o sa$e had een &o"p$ied ith as the oKer "ade on

Mar&h ), '(, in &onne&tion ith hi&h the earnest "one6 in the

a"o#nt o P' "i$$ion as tendered 6 respondents, had a$read6 een

a&&epted 6 petitioner. The &o#rt &ited Art. '(0) o the Cii$ Code hi&h

proides that W45heneer earnest "one6 is %ien in a &ontra&t o sa$e, it

sha$$ e &onsidered as part o the pri&e and as proo o the pere&tion o 

the &ontra&t.W The a&t the parties had not a%reed on the "ode o pa6"ent

did not aKe&t the &ontra&t as s#&h is not an essentia$ e$e"ent or its

a$idit6. In addition, the &o#rt o#nd that Sore&are6 had a#thorit6 to a&t in

eha$ o petitioner or the sa$e o the properties.425

Petitioner "oed or re&onsideration o the tria$ &o#rts de&ision, #t its"otion as denied. 7en&e, this petition.

Petitioner &ontends that the Co#rt o Appea$s erred in ;ndin% that there

as a pere&ted &ontra&t o sa$e eteen the parties e&a#se the Mar&h

), '( $etter o respondents, hi&h petitioner a&&epted, "ere$6 res#$ted

in an option &ontra&t, a$eit it as #nenor&ea$e or $a& o a distin&t

&onsideration. Petitioner ar%#es that the asen&e o a%ree"ent as to the

"ode o pa6"ent as ata$ to the pere&tion o the &ontra&t o sa$e.

Petitioner a$so disp#tes the appe$$ate &o#rts r#$in% that Isidro A.

Sore&are6 had a#thorit6 to se$$ the s#=e&t rea$ properties.405

Respondents ere reF#ired to &o""ent ithin ten 8'*9 da6s ro" noti&e.

7oeer, despite '1 e+tensions tota$$in% '() da6s hi&h the Co#rt had

%ien to the", respondents ai$ed to ;$e their &o""ent. The6 ere th#s

&onsidered to hae aied the ;$in% o a &o""ent.

 The petition is "eritorio#s.

In ho$din% that there is a pere&ted &ontra&t o sa$e, the Co#rt o Appea$s

re$ied on the o$$oin% ;ndin%s: 8'9 earnest "one6 as a$$e%ed$6 %ien 6respondents and a&&epted 6 petitioner thro#%h its i&e-president and

operations "ana%er, Isidro A. Sore&are6 and 8)9 the do"entar6

eiden&e in the re&ords sho that there as a pere&ted &ontra&t o sa$e.

ith re%ard to the a$$e%ed pa6"ent and a&&eptan&e o earnest "one6, the

Co#rt ho$ds that respondents did not %ie the P' "i$$ion as Wearnest

"one6W as proided 6 Art. '(0) o the Cii$ Code. The6 presented the

a"o#nt "ere$6 as a deposit o hat o#$d eent#a$$6 e&o"e the earnest

"one6 or donpa6"ent sho#$d a &ontra&t o sa$e e "ade 6 the". The

a"o#nt as th#s %ien not as a part o the p#r&hase pri&e and as proo o 

the pere&tion o the &ontra&t o sa$e #t on$6 as a %#arantee that

respondents o#$d not a& o#t o the sa$e. Respondents in a&t des&ried

the a"o#nt as an Wearnest-deposit.W In Spouses #oromal, Sr. v. Court of 

 Appeals,45 it as he$d:

. . . hi$e the PJ,*** "i%ht hae indeed een paid to

Car$os in O&toer, '32, there is nothin% to sho that the

sa"e as in the &on&ept o the earnest "one6

&onte"p$ated in Art. '(0) o the Cii$ Code, inoed 6

petitioner, as si%ni6in% pere&tion o the sa$e. Vieed in

the a&drop o the a&t#a$ "i$ie# thereo e+tant in the

re&ord, e are "ore in&$ined to e$iee that the

said P J,***.** ere paid in the &on&ept o earnest "one6as the ter" as #nderstood #nder the O$d Cii$ Code, that

is, as a %#arantee that the #6er o#$d not a& o#t,

&onsiderin% that it is not &$ear that there as a$read6 a

de;nite a%ree"ent as to the pri&e then and that petitioners

ere de&ided to #6 3Y2 on$6 o the propert6 sho#$d

respondent ae$$ana re#se to a%ree to part ith her 'Y2

share.4'*5

In the present &ase, the P' "i$$ion Wearnest-depositW &o#$d not hae een

%ien as earnest "one6 as &onte"p$ated in Art. '(0) e&a#se, at the ti"e

hen petitioner a&&epted the ter"s o respondents oKer o Mar&h ),'(, their &ontra&t had not 6et een pere&ted. This is eident ro" the

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o$$oin% &onditions atta&hed 6 respondents to their $etter, to it: 8'9 that

the6 e %ien the e+&$#sie option to p#r&hase the propert6 ithin 1* da6s

ro" a&&eptan&e o the oKer 8)9 that d#rin% the option period, the parties

o#$d ne%otiate the ter"s and &onditions o the p#r&hase and 819

petitioner o#$d sere the ne&essar6 approa$s hi$e respondents o#$d

hand$e the do"entation.

 The ;rst &ondition or an option period o 1* da6s s#&ient$6 shos that a

sa$e as neer pere&ted. As petitioner &orre&t$6 points o#t, a&&eptan&e o this &ondition did not %ie rise to a pere&ted sa$e #t "ere$6 to an option

or an a&&epted #ni$atera$ pro"ise on the part o respondents to #6 the

s#=e&t properties ithin 1* da6s ro" the date o a&&eptan&e o the oKer.

S#&h option %iin% respondents the e+&$#sie ri%ht to #6 the properties

ithin the period a%reed #pon is separate and distin&t ro" the &ontra&t o 

sa$e hi&h the parties "a6 enter. 4''5 A$$ that respondents had as =#st the

option to #6 the properties hi&h prii$e%e as not, hoeer, e+er&ised

6 the" e&a#se there as a ai$#re to a%ree on the ter"s o pa6"ent. No

&ontra&t o sa$e "a6 th#s e enor&ed 6 respondents.

>#rther"ore, een the option sered 6 respondents ro" petitioner as

ata$$6 dee&tie.

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"#%R%FOR%, the de&ision o the Co#rt o Appea$s is REVERSED and

respondents &o"p$aint is DISMISSED.

SO ORD%R%D&

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$O!RD%S ON( $IMSON' petitioner, vs. CO!RT OF APP%A$S'

SPO!S%S $OR%N)O D% V%RA an AS!NCION SANTOS-D%

V%RA' TOMAS C!%NCA' +R&' an S!NVAR R%A$T, 

D%V%$OPM%NT CORPORATION' respondents&

D % C I S I O N

%$$OSI$$O' J&4

>i$ed #nder R#$e (J o the R#$es o Co#rt this Petition for Revie% on

Certiorari sees to reie, reerse and set aside the #ecision4'5 o the Co#rt

o Appea$s dated '0 Ma6 '0 reersin% that o the Re%iona$ Tria$ Co#rt

dated 1* #ne '1. The petition $ieise assai$s the Resolution4)5 o the

appe$$ate &o#rt o ' O&toer '0 den6in% petitioners $otion for 

Reconsi!eration.

Petitioner Lo#rdes On% Li"son, in her '( Ma6 '2 Complaint ;$ed

eore the tria$ &o#rt,415 a$$e%ed that in #$6 '20 respondent spo#ses

Loren?o de Vera and As#n&ion Santos-de Vera, thro#%h their a%ent Mar&osaSan&he?, oKered to se$$ to petitioner a par&e$ o $and &onsistin% o (0,)3*

sF#are "eters, "ore or $ess, sit#ated in Barrio San Dionisio, ParaXaF#e,

Metro Mani$a that respondent spo#ses inor"ed her that the6 ere the

oners o the s#=e&t propert6 that on 1' #$6 '20 she a%reed to #6 the

propert6 at the pri&e o P1(.** per sF#are "eter and %ae the s#"

o P)*,***.** to respondent spo#ses as Wearnest "one6W that respondent

spo#ses si%ned a re&eipt thereor and %ae her a '*-da6 option period to

p#r&hase the propert6 that respondent Loren?o de Vera then inor"ed her

that the s#=e&t propert6 as "ort%a%ed to E"i$io Ra"os and Isidro

Ra"os that respondent Loren?o de Vera ased her to pa6 the a$an&e o 

the p#r&hase pri&e to ena$e hi" and his ie to sett$e their o$i%ation ith

the Ra"oses.

Petitioner a$so aerred that she a%reed to "eet respondent spo#ses

and the Ra"oses on J A#%#st '20 at the O&e o the Re%istr6 o Deeds

o Maati, Metro Mani$a, to &ons#""ate the transa&tion #t d#e to the

ai$#re o respondent As#n&ion Santos-de Vera and the Ra"oses to appear,

no transa&tion as or"a$i?ed. In a se&ond "eetin% s&hed#$ed on ''

A#%#st '20 she &$ai"ed that she as i$$in% and read6 to pa6 the a$an&e

o the p#r&hase pri&e #t the transa&tion a%ain did not "ateria$i?e as

respondent spo#ses ai$ed to pa6 the a& ta+es o s#=e&t

propert6. S#seF#ent$6, on )1 A#%#st '20 petitioner a$$e%ed$6 %ae

respondent Loren?o de Vera three 819 &he&s in the tota$ a"o#nt

o P13,'2*.** or the sett$e"ent o the a& ta+es o the propert6 and or

the pa6"ent o the F#it&$ai"s o the three 819 tenants o s#=e&t $and. The

a"o#nt as p#rported$6 &onsidered part o the p#r&hase pri&e and

respondent Loren?o de Vera si%ned the re&eipts thereor.

Petitioner a$$e%ed that on J Septe"er '20 she as s#rprised to

$earn ro" the a%ent o respondent spo#ses that the propert6 as the

s#=e&t o a ne%otiation or the sa$e to respondent S#nar Rea$t6Dee$op"ent Corporation 8Sina$$6, or the a$$e%ed #n$a#$ and #n=#st a&ts o respondent

spo#ses, hi&h &a#sed her da"a%e, pre=#di&e and in=#r6, petitioner

&$ai"ed that the #ee! of Sale, sho#$d e ann#$ed and TCT No. S-2)122 in

the na"e o respondent S

8/9/2019 3rd 8

29/50

On the other hand, respondents S

8/9/2019 3rd 8

30/50

oner o the propert6 the ri%ht to se$$ or de"and a sa$e. It is a$so

so"eti"es &a$$ed an W#na&&epted oKer.W An option is not o itse$ a

p#r&hase, #t "ere$6 seres the prii$e%e to #6.405  It is not a sa$e o 

propert6 #t a sa$e o the ri%ht to p#r&hase.45 It is si"p$6 a &ontra&t 6

hi&h the oner o propert6 a%rees ith another person that he sha$$ hae

the ri%ht to #6 his propert6 at a ;+ed pri&e ithin a &ertain ti"e. 7e does

not se$$ his $and he does not then a%ree to se$$ it #t he does se$$

so"ethin%, i.e., the ri%ht or prii$e%e to #6 at the e$e&tion or option o the

other part6.4'*5 Its distin%#ishin% &hara&teristi& is that it i"poses no indin%

o$i%ation on the person ho$din% the option, aside ro" the &onsideration

or the oKer. ina$$6, hen petitioner %ae the Wearnest "one6,W the Receipt did

not reea$ that she as o#nd to pa6 the a$an&e o the p#r&hase pri&e. Ina&t, she &o#$d een oreit the "one6 %ien i the ter"s o the option ere

not "et. Th#s, the P)*,***.** &o#$d on$6 e "one6 %ien as &onsideration

or the option &ontra&t. That the &ontra&t eteen the parties is one o 

option is #ttressed 6 the proision therein that sho#$d the transa&tion o 

the propert6 not "ateria$i?e itho#t a#$t o petitioner as #6er,

respondent Loren?o de Vera o$i%ates hi"se$ to ret#rn the #$$ a"o#nt

o P)*,***.** Wearnest "one6W ith option to #6 or oreit the sa"e on

the a#$t o petitioner. It is #rther o$stered 6 the proision therein that

%#arantees petitioner that she or her representatie o#$d e noti;ed in

&ase the s#=e&t propert6 as so$d or en"ered to a third

person. >ina$$6, the Receipt proided or a period ithin hi&h the option

to #6 as to e e+er&ised, i.e., Within ten 8'*9 da6sW ro" 1' #$6 '20.

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