Delpher Trades Corp vs Iac and Hydro Pipes Inc

7/27/2019 Delpher Trades Corp vs Iac and Hydro Pipes Inc

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SALES AND LEASE CASE DIGESTS 1 o

Delpher trades corp vs iac and hydro pipes inc.

acts: the pacheco family obtained 2500 shares of stock from

DTC, in exchange for a parcel of land that was currently being

eased by hydro pipes inc. hydro pipes filed for the violation of

heir right to first option to buy. It was granted by iac. However,

he petitioners contend that what happened was a deed ofxchange and not a deed of sale.

ssue: won the iac erred

Held: yes. The petitoners were able to prove that it was indeed a

eed of exchange. DTC is owned by the pachecos, and as evident

rom the 2500 shares of stock, which is 55% of the stocks of DTC,

hey have control of the company. They were merely trying to

essen taxes, by avoiding inheritance tax.

Rubias vs Batiller (1973)

acts:- Francisco Militante claimed that he owned aparcel of land

ocated in Iloilo. He filed with the CFI of Iloilo an application for

he registration of title of the land. This was opposed by the

Director of Lands, the Director of Forestry, and other oppositors.

he case was docked as a land case, and after trial the court

ismissed the application for registration. Militante appealed to

he Court of Appeals.

Pending that appeal, he sold to Rubias (hisson-in-law and a

awyer) the land.

The CA rendered a decision, dismissing the application for

egistration.

Rubias filed a Forcible Entry and Detainer case against Batiller.

In that case, the court held that Rubias has no cause of action

ecause the property in dispute which Rubias allegedly bought

rom Militante was the subject matter of a land case, in which

ase Rubias was the counsel on record of Militante himself. It

hus falls under Article1491 of the Civil Code. (Hence, this

ppeal.)

ssue: Whether the sale of the land is prohibited under Article

491.

Held: YES Article 1491 says that The following persons cannot

cquire any purchase, even at a public or judicial auction, either

n person or through the mediation of another. (5) Justices,

udges, prosecuting attorneys, clerks of superior and inferior

ourts, and other officers and employees connected with the

administration of justice, the property and rights in litigation

levied upon an execution before the court within wh

jurisdiction or territory they exercise their respective functio

this prohibition includes the act of acquiring by assignment

shall apply to lawyer, with respect to the property and rig

which may be the object of any litigation in which they may t

part by virtue of their profession. The present case clearly funder this, especially since the case was still pending app

when the sale was made.

Issue: Legal effect of a sale falling under Article1491?

Held: NULL AND VOID.CANNOT BE RATIFIED.

Manresa considered such prohibited acquisitions (which

under the Spanish Civil Code)as merely voidable because

Spanish Code did not recognize nullity. But our Civil Code d

recognize the absolute nullity of contracts whose cause, ob

or purpose is contract to law, morals, good customs, public oror public policy or which are expressly prohibited or decla

void by law and declares such contracts inexistent and v

from the beginning. The nullity of such prohibited contract

definite and permanent, and cannot be cured by ratification.

public interest and public policy remain paramount and do

permit of compromise orratification. In this aspect,

permanent disqualification of public and judicial officers

lawyers grounded on public policy differs from the first th

cases of guardians agents and administrators(under Art 1491)

to their transactions, it has been opined that they may

ratified by means of and in the form of a new contract

which case its validity shall be determined only by

circumstances at the time of execution of such new contract

those cases, the object which was illegal at the time of the f

contract may have already become lawful at the time of

ratification or second contract, or the intent, or the service wh

was impossible. The ratification or second contract would then

valid from its execution; however, it does not retroact to the d

of the first contract. Decision affirmed.

Buenaventura vs. CA (2003)

FACTS:

Defendant spouses Leonardo Joaquin and Feliciana Landrito

parents of co-defendants Fidel, Tomas, Artemio, Clarita, Felic

Fe, and Gavino. They are also the parents of plain

Consolacion, Nora, Emma, and Natividad. A deed of sale

executed by the defendant spouses in favor of their co-defend

children.

However, such deed of sale was sought to be declared null

void by the plaintiffs.


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laintiffs argue that:

. There was no actual consideration

. Even assuming there was consideration, the properties are

more than 3-fold times more valuable than the measly sums

ppearing therein.

. The sale was the result of a deliberate conspiracy to unjustly

eprive the rest of the compulsory heirs of their legitime.

TC: ruled in favor of the defendants and dismissed the

omplaint. On the grounds that:

. Plaintiffs do not have a valid cause of action against defendants

ince there can be no legitime to speak of prior to the death of

heir parents.

. Legitime is computed as of the time of the death of the

ecedent.

A: affirmed the decision of the RTC

SSUE: I. W/N the Deeds of Sale are void for lack of consideration

HELD: I. DEED OF SALE VALID.

. A contract of sale is not a real contract, but a consensual

ontract.

. As a consensual contract, a contract of sale becomes a binding

nd 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,

he contract of sale is valid, despite the manner of payment, or

ven the breach of that manner of payment.

. It is not the act of payment of price that determines the

alidity of a contract of sale.

. Payment of the price has nothing to do with the perfection of

he contract.

. Failure to pay the consideration is different from lack of

onsideration.

. Petitioners do not have any legal interest over the properties.

heir rights over the properties are merely inchoate and vests

nly upon their parents death.

KER & CO., LTD. vs. LINGAD G.R. No. L-20871 April 30, 1971

Facts: CIR assessed the sum of P20, 272.33 as the comme

brokers percentage tax, surcharge, and compromise pen

against Ker & Co. There was a request on the part of petitio

for the cancellation of such assessment, which request turned down. As a result, it filed a petition for review with

Court of Tax Appeals. CTA ruled that that Ker & Co is liable

commercial broker under Section 194 (t) of the National Inte

Revenue Code.

Ker & Co signed a contract with the United States Rub

International, the former being referred to as the Distributor

the latter specifically designated as the Company. The shipme

would cover products for consumption in Cebu, Bohol, Le

Samar, Jolo, Negros Oriental, and Mindanao except [t

province of Davao. Ker & Co, as Distributor, was precluded fr

disposing such products elsewhere than in the above pla

unless written consent would first be obtained from

Company. It was required to exert every effort to have

shipment of the products in the maximum quantity and

promote in every way the sale thereof. The prices, discou

terms of payment, terms of delivery and other conditions of

were subject to change in the discretion of the Company.

Issue: WON the relationship Ker & Co and US Rubber was tha

a vendor-vendee or principal-broker? PRINCIPAL- BROKER, he

liable under Section 194 (t) of the NIRC.

Held: The relationship between them is one of brokerage

agency. That the petitioner Ker & Co., Ltd. is, by contract

stipulation, an agent of U.S. Rubber International is borne outhe facts that:

1. Petitioner can dispose of the products of the Company onlycertain persons or entities and within stipulated limits, un

excepted by the contract or by the Rubber Company.

2. It merely receives, accepts and/or holds upon consignment products, which remain properties of the latter company.

3. Every effort shall be made by petitioner to promote in every wthe sale of the products (Par. 3); that sales made by petitioner

subject to approval by the company.

4. On dates determined by the rubber company, petitioner srender a detailed report showing sales during the month.

5. The rubber company shall invoice the sales as of the datesinventory and sales report (Par. 14); that the rubber comp

agrees to keep the consigned goods fully insured under insura

policies payable to it in case of loss.

6. Upon request of the rubber company at any time, petitioner srender an inventory of the existing stock which may be chec

by an authorized representative of the former.


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Upon termination or cancellation of the Agreement, all goods

eld on consignment shall be held by petitioner for the account

f the rubber company until their disposition is provided for by

he latter.

ILINVEST vs CA

78 SCRA 188, G.R. No. 82508 September 29, 1989

ACTS:

Herein private respondents spouses Jose Sy Bang and Iluminada

an were engaged in the sale of gravel produced from crushed

ocks and used for construction purposes. They intended to buy

ock crusher from Rizal Consolidated Corporation which carried a

ash price tag of P550,000.00. They applied for financial

ssistance from herein petitioner Filinvest Credit Corporation,

who agreed to extend financial aid on the certain conditions.

A contract of lease of machinery (with option to purchase) was

ntered into by the parties whereby the private respondents

greed to lease from the petitioner the rock crusher for two years

tarting from July 5, 1981, payable as follows: P10,000.00 first 3

months, P23,000.00 next 6 months, P24,800.00 next 15

months. It was likewise stipulated that at the end of the two-year

eriod, the machine would be owned by the private respondents.

hus the private respondent issued in favor of the petitioner a

heck for P150,550.00, as initial rental (or guaranty deposit), and

4 postdated checks corresponding to the 24 monthly rentals. In

ddition, to guarantee their compliance with the lease contract,

he private respondent executed a real estate mortgage over two

arcels of land in favor of the petitioner. The rock crusher was

elivered to the spouses.

However, 3 months later, the souses stopped payment when

etitioner had not acted on the complaints of the spouses about

he machine. As a consequence, petitioner extrajudicially

oreclosed the real estate mortgage. The spouses filed a

omplaint before the RTC. The RTC rendered a decision in favor

f private respondent. The petitioner elevated the case to CA

which affirmed the decision in toto. Hence, this petition.

SSUES:

. Whether or not the nature of the contract is one of a contract

f sale.\

. Whether or not the remedies of the seller provided for in

Article 1484 are cumulative.

HELD:

1. Yes. The intent of the parties to the subject contract is for

so-called rentals to be the installment payments. Upon

completion of the payments, then the rock crusher, sub

matter of the contract, would become the property of the priv

respondents. This form of agreement has been criticized a

lease only in name.

Sellers desirous of making conditional sales of their goods,

who do not wish openly to make a bargain in that form, for

reason or another, have frequently restored to the device

making contracts in the form of leases either with options to

buyer to purchase for a small consideration at the end of te

provided the so-called rent has been duly paid, or w

stipulations that if the rent throughout the term is paid, title s

thereupon vest in the lessee. It is obvious that such transact

are leases only in name. The so-called rent must necessarily

regarded as payment of the price in installments since the

payment of the agreed amount results, by the terms of barg

in the transfer of title to the lessee.

2. No, it is alternative. The seller of movable in installments

case the buyer fails to pay 2 or more installments, may elec

pursue either of the following remedies: (1) exact fulfillment

the purchaser of the obligation; (2) cancel the sale; or

foreclose the mortgage on the purchased property if one

constituted thereon. It is now settled that the said remedies

alternative and not cumulative, and therefore, the exercise

one bars the exercise of the others. Indubitably, the devic

contract of lease with option to buy is at times resorted to

means to circumvent Article 1484, particularly paragraph

thereof. Through the set-up, the vendor, by retaining owners

over the property in the guise of being the lessor, retalikewise the right to repossess the same, without going thro

the process of foreclosure, in the event the vendee-les

defaults in the payment of the installments. There ar

therefore no need to constitute a chattel mortgage over

movable sold. More important, the vendor, after reposses

the property and, in effect, canceling the contract of sale, get

keep all the installments-cum-rentals already paid.

Antonio Medina vs. CIR

Facts:

Subsequent to marriage, petitioners engaged in concessions w

the government, while his wife started to engage in business

lumber dealer. From 1949 to 1952, petitioner sold logs to

wife. On the thesis that the sales are null and void,

considered the sales by Mrs. Medina as the petitioners orig

sales taxable under the NIRC. Petitioner filed a petition

reconsideration, revealing for the first time the alleged prema

agreement of complete separation of property.


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ssue:

Whether or not the sales made by the petitioner to his wife could

e considered as his original taxable sales

Held:

t appears that at the time of the marriage between petitioner

nd his wife, they neither had any property nor business of their

wn, as to have really urged them to enter into the supposed

roperty agreement. Secondly, the testimony that the separation

f property agreement was recorded in the Registry of Property

hree months before the marriage, is patently absurd, since such

prenuptial agreement could not be effective before marriage is

elebrated, and would automatically be cancelled if the union

was called off. In the third place, despite their insistence on the

xistence of the ante nuptial contract, the couple, strangely

nough, did not act in accordance with its alleged covenants. It

was not until July of 1954 that he alleged, for the first time, the

xistence of the supposed property separation agreement.

inally, the Day Book of the Register of Deeds on which the

greement would have been entered, had it really been

egistered as petitioner insists, and which book was among those

aved from the ravages of the war, did not show that the

ocument in question was among those recorded therein.

he wife is authorized to engage in business and for the incidents

hat flow therefrom when she so engages therein. But the

ransactions permitted are those entered into with strangers, and

o not constitute exceptions to the prohibitory provisions of

Article 1490 against sales between spouses.

ontracts violative of the provisions of Article 1490 of the Civil

ode are null and void. Being void transactions, the sales made

y the petitioner to his wife were correctly disregarded by the

ollector in his tax assessments that considered as the taxable

ales those made by the wife through the spouses' common

gent, Mariano Osorio. In upholding that stand, the Court below

ommitted no error.

UP V. CA

ACTS: Firestone Ceramics (Firestone) entered into a lease

ontract w/ the National Development Corporation (NDC) for a

ortion of its property in Sta. Mesa. 2 more lease agreements

were entered into for NDCs 4-unit pre-fabricated reparation

teel warehouse and 6-unit pre-fabricated reparation steel

warehouse. Such agreements provided for extenion of the terms

f the lease.

Firestone requested for an extension, which was granted w/

condition that in the event NDC "with the approval of hig

authorities, decide to dispose and sell these properties includ

the lot, priority should be given to the LESSEE first refusal

Firestone again requested for an extension, but

communications were unacknowledged. FIRESTONpredicament worsened when rumors of NDC's supposed plan

dispose of the subject property in favor of petitioner Polytec

University of the Philippines (PUP) came to its knowled

Forthwith, FIRESTONE served notice on NDC conveying its de

to purchase the property in the exercise of its contractual righ

first refusal.

The PUP-NDC agreement revolved around Memorandum No

issued by Pres. Aquino ordering the transfer of the property

PUP.

PUP and NDC claim that there was no sale between them:

The right of first refusal invoked was limited to the wareho

and not the lot

The courts supposedly created a contract to sell b/w the part

It argued that the "court cannot substitute or decree its mind

consent for that of the parties in determining whether or no

contract (has been) perfected between PUP and NDC

NDC posits that the transaction did not amount to a

considering that "ownership of the property remained with

government." Petitioner NDC introduced the novel proposi

that if the parties involved are both government entities transaction cannot be legally called a sale.

Issues:

w/n there was a contract of sale b/w PUP and NDC

w/n Firestone should be allowed to exercise its right of refusa

Held:

YES

Aside from the fact that the intention of NDC and PUP to en

into a contract of sale was clearly expressed in the Memorand

Order No. 214, a close perusal of the circumstances of this c

strengthens the theory that the conveyance of the property fr

NDC to PUP was one of absolute sale, for a valua

consideration, and not a mere paper transfer as argued


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Documents

Delpher Trades Corp vs Iac and Hydro Pipes Inc