Philippine Supreme Court Jurisprudence


Philippine Supreme Court Jurisprudence > Year 1987 > June 1987 Decisions > G.R. No. L-67881 June 30, 1987 - PILIPINAS BANK v. INTERMEDIATE APPELLATE COURT, ET AL.:




PHILIPPINE SUPREME COURT DECISIONS

SECOND DIVISION

[G.R. No. L-67881. June 30, 1987.]

PILIPINAS BANK as Successor-In-Interest Of And/Or In substitution to, The MANUFACTURERS BANK AND TRUST COMPANY, Petitioner-Appellant, v. INTERMEDIATE APPELLATE COURT (Fourth Civil Cases Division), and JOSE W. DIOKNO and CARMEN I. DIOKNO, Respondents-Appellees.


D E C I S I O N


PARAS, J.:


This is an appeal by certiorari from the Decision 1 of the respondent court dated May 31, 1984 in CA-G.R. CV No. 67205 entitled "Jose W. Diokno and Carmen I. Diokno, Plaintiffs-Appellees, v. The Manufacturers Bank and Trust Company, Defendant-Appellant" which affirmed the decision 2 of the Court of First Instance of Rizal (Pasig Branch XXI) in Civil Case No. 19660, the dispositive portion of which reads:jgc:chanrobles.com.ph

"WHEREFORE, judgment is rendered in favor of the plaintiffs and against the defendant, ordering the defendant Manufacturers Bank & Trust Company:jgc:chanrobles.com.ph

"1. To deliver to the plaintiffs the parcel of land described in Contract to Sell No. VV-18-(a) in the total area of 5,936 square meters and to execute in their favor the necessary deed of absolute sale therefor;

"2. To pay the sum of P556,160.00 less the amount due on the contract (i.e., the unpaid installments from December, 1966 until the contract would have been fully paid together with interest thereon up to March 25, 1974) with legal interest on said balance from April 22, 1974 until the same is fully paid;

"3. P50,000.00 by way of moral damages;

"4. P50,000.00 by way of exemplary damages;

"5. Ten per cent (10%) of the judgment by way of attorney’s fees; and

"6. Costs of suit.

SO ORDERED." (Rollo, pp. 14-15)

The following are the undisputed facts of the case:chanrob1es virtual 1aw library

1. On April 18, 1961, Hacienda Benito, Inc. (petitioner’s predecessor-in-interest) as vendor, and private respondents, as vendees executed Contract to Sell No. VV-18 (a) (Exh. A) over a parcel of land with an area of 5,936 square meters of the Victoria Valley Subdivision in Antipolo, Rizal, subject to the following terms and conditions, among others, relevant to this petition:chanrob1es virtual 1aw library

(a) The total contract price for the entire 5,936 square-meter-lot was P47,488.00;

(b) Of the total sum, an amount of P12,182.00 was applied thereto so as to reduce the balance on the principal to P35,306.00;

(c) The aforesaid balance, together with the stipulated interest of 6% per annum, was to be paid over a period of 8-1/2 years starting on May 1, 1961 at a monthly installment of P446.10 until fully paid -although this monthly installment was later adjusted to the higher amount of P797.86, starting on April 1, 1965;

(d) Upon complete payment by the vendee of the total price of the lot the vendor shall execute a deed of sale in favor of the vendee;

(e) The contract shall be considered automatically rescinded and cancelled and of no further force and effect upon failure of the vendee to pay when due, three or more consecutive installments as stipulated therein or to comply with any of the terms and conditions thereof, in which case the vendor shall have right to resell the said parcel of land to any person interested, forfeiting payments made by the vendee as liquidated damages.

2. On July 27, 1965, petitioner sent to private respondents a Statement of Account (Exh. F-1) requesting remittance of installment arrears showing partial payments for the month of April 1965 and May 1965 and complete default for June, July and August, 1965;

3. Likewise, on August 31, 1965, petitioner sent to private respondents another Statement of Account with the additional entries of interests and the incoming installment for September, 1965;

4. In partial compliance with the aforesaid Statements of Account, private respondents paid on September 3, 1965 the sum of P1,397.00 which answers for the installments for the months of June 1965 to August 1965;

5. On March 17, 1967, petitioner sent private respondents a simple demand letter showing a delinquency in their monthly amortizations for 19 months (Exh. 9);

6. On April 17, 1967, petitioner again sent private respondents a demand letter showing total arrearages of 20 months as of April 1965, but this time advising that unless they up-date their installment payments, petitioner shall be constrained to avail of the automatic rescission clause (Exh. 10);

7. On May 17, 1967, private respondents made a partial payment of P2,000.00 with the request for an extension of 60 days from May 17, 1967 within which to up-date their account (Exh. 10-a);

8. On July 17, 1967, private respondents wrote a letter to petitioner asking another extension of sixty (60) days to pay all their arrearages and update their payments under Contract No. VV-18 (a);

9. On September 18, 1967, private respondents paid P5,000.00 as partial payment and requested an extension of another 30 days from September 18, 1967 within which to update their account (Exh. 10-c);

10. On October 19, 1967, however, private respondents failed to update their arrearages and did not request for any further extension of time within which to update their account;

11. After almost three (3) years, or on July 16, 1970, private respondents wrote a letter to petitioner requesting for a Statement of Account as of date in arrears and interests (Exh. 10-d), to which petitioner made a reply on July 22, 1970 (Exh. 11);

12. On May 19, 1971, petitioner wrote a letter to private respondents, reminding them of their balance which will be due on the 31st instant (Exh. J);

13. More than two (2) years from May 19, 1971 or on July 5, 1973, private respondents wrote a letter to petitioner expressing their desire to fully settle their obligation, requesting for a complete statement of all the balance due including interests;

14. On March 14, 1974, private respondents wrote a letter reiterating their request in their letter dated July 5, 1973, which has not been complied with despite several follow-ups (Exh. O);

15. On March 25, 1974, private respondent Carmen I. Diokno went to see the Chairman of petitioner’s Board of Directors on the matter informing him that she had a buyer who was ready to purchase the property,

16. On March 27, 1974, petitioner wrote a letter to private respondents, informing them that the contract to sell had been rescinded/cancelled by a notarial act, to which letter was annexed a "Demand for Rescission of Contract" notarized on March 25, 1974 (Exh. 12);

17. In view of the foregoing, private respondents filed a Complaint for Specific Performance with Damages to compel petitioner to execute a deed of sale in their favor, and to deliver to them the title of the lot in question.

18. Petitioner filed an Answer with counterclaim for damages in the form of attorney’s fees, claiming that Contract to Sell No. VV-18(a) has been automatically rescinded or cancelled by virtue of private respondents’ failure to pay the installments due in the contract under the automatic rescission clause.

19. After trial, the lower court rendered a decision in private respondents’ favor, holding that petitioner could not rescind the contract to sell, because: (a) petitioner waived the automatic rescission clause by accepting payment on September 1967, and by sending letters advising private respondents of the balances due, thus, looking forward to receiving payments thereon; (b) in any event, until May 18, 1977 (when petitioner made arrangements for the acquisition of additional 870 square meters) petitioner could not have delivered the entire area contracted for, so, neither could private respondents be liable in default, citing Art. 1189 of the New Civil Code. (Decision, pp. 141-148, Amended Record on Appeal).

Said decision was affirmed on appeal.

Hence, this Petition For Review on Certiorari, raising the main issue of whether or not the Contract to Sell No. VV-18(a) was rescinded or cancelled, under the automatic rescission clause contained therein.

We find the petition meritless. While it is true that in the leading case of Luzon Brokerage Co., Inc. v. Maritime Building Co., Inc. and Myers Building Co., 43 SCRA 93 the Supreme Court reiterated among other things that a contractual provision allowing "automatic rescission" (without prior need of judicial rescission, resolution or cancellation) is VALID, the remedy of one who feels aggrieved being to go to Court for the cancellation of the rescission itself, in case the rescission is found unjustified under the circumstances, still in the instant case there is a clear WAIVER of the stipulated right of "automatic rescission," as evidenced by the many extensions granted private respondents by the petitioner. In all these extensions, the petitioner never called attention to the proviso on "automatic rescission."cralaw virtua1aw library

WHEREFORE the assailed decision is hereby AFFIRMED but the actual damages are hereby reduced to P250,000.00 (the profit private respondents could have earned had the land been delivered to them at the time they were ready to pay all their arrearages) minus whatever private respondents still owe the petitioner (with the stipulated 6% annual interest up to March 25, 1974) as a result of the contract.

SO ORDERED.

Fernan (Chairman), Gutierrez, Jr., Padilla and Cortes, JJ., concur.

Bidin J., no part., I participated in the appealed decision of the Court of Appeals.

Endnotes:



1. Penned by Justice Porfirio V. Sison concurred in by Justices Abdulwahid A. Bidin, Marcelino R. Veloso, and Desiderio P. Jurado.

2. Penned by Judge Gregorio G. Pineda.




Back to Home | Back to Main




















chanrobles.com





ChanRobles On-Line Bar Review

ChanRobles Internet Bar Review : www.chanroblesbar.com

ChanRobles MCLE On-line

ChanRobles Lawnet Inc. - ChanRobles MCLE On-line : www.chanroblesmcleonline.com






June-1987 Jurisprudence                 

  • G.R. No. 78582 June 10, 1987 - PEOPLE OF THE PHIL. v. DANTE D. DE LA CRUZ

  • G.R. No. L-48241 June 11, 1987 - REPUBLIC OF THE PHILIPPINES v. JOSE P. ARRO

  • G.R. No. L-55526 June 15, 1987 - FILOIL REFINERY CORPORATION v. RAFAEL T. MENDOZA

  • G.R. No. L-46998 June 17, 1987 - PEOPLE OF THE PHIL. v. FELOMINO GARCIANO

  • G.R. No. L-66574 June 17, 1987 - ANSELMA DIAZ v. INTERMEDIATE APPELLATE COURT

  • G.R. No. 74145 June 17, 1987 - PEOPLE OF THE PHIL. v. ZOSIMO CRISOLOGO

  • G.R. No. L-38188 June 18, 1987 - GREGORIO PETILLA, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. L-41008 June 18, 1987 - PEOPLE OF THE PHIL. v. ARTURO PECATO, ET AL.

  • G.R. No. L-47489 June 18, 1987 - PEOPLE OF THE PHIL. v. EULOGIO MANAAY

  • G.R. No. L-48140 June 18, 1987 - MIGUEL B. CARAG v. COURT OF APPEALS, ET AL.

  • G.R. No. L-49749 June 18, 1987 - ANDREA SANGALANG v. BALBINO CAPARAS, ET AL.

  • G.R. No. L-53001-56 June 18, 1987 - ERASMO GABISON, ET AL. v. SANDIGANBAYAN, ET AL.

  • G.R. No. L-55982 June 18, 1987 - IRENE P. MARIANO v. FRANCISCO M. BAUTISTA, ET AL.

  • G.R. No. L-66866 June 18, 1987 - REPUBLIC OF THE PHIL. v. MINDA DE PORKAN, ET AL.

  • G.R. No. L-66965 June 18, 1987 - PEOPLE OF THE PHIL. v. ARSENIO B. FERRERA

  • G.R. No. L-67302 June 18, 1987 - PEOPLE OF THE PHIL. v. ANTONIO TORREFRANCA

  • G.R. No. L-69651 June 18, 1987 - EDUARDO S. SOLANTE, ET AL. v. SANDIGANBAYAN

  • G.R. No. 71365 June 18, 1987 - PAPER INDUSTRIES CORP. OF THE PHIL. v. INTERMEDIATE APPELLATE COURT, ET AL.

  • G.R. No. 72936 June 18, 1987 - PEOPLE OF THE PHIL. v. ROLANDO M. PICARDAL

  • G.R. No. 73490 June 18, 1987 - UNITED STATES LINES, INC. v. COMMISSIONER OF CUSTOMS

  • G.R. No. L-73662 June 18, 1987 - MAI PHILIPPINES, INC. v. NATIONAL LABOR RELATIONS COMMISSION, ET AL.

  • G.R. No. L-75697 June 18, 1987 - VALENTIN TIO v. VIDEOGRAM REGULATORY BOARD, ET AL.

  • G.R. No. L-48642 June 22, 1987 - PEOPLE OF THE PHIL. v. TOMAS SALCEDO, ET AL.

  • G.R. No. L-57322 June 22, 1987 - NORMAN NODA v. GREGORIA CRUZ-ARNALDO

  • G.R. No. 75197 June 22, 1987 - E. RAZON, INC., ET AL. v. PHILIPPINE PORTS AUTHORITY, ET AL.

  • G.R. No. L-45722 June 23, 1987 - PEOPLE OF THE PHIL. v. LEONCIO JUSEP

  • G.R. No. L-48957 June 23, 1987 - ERNESTO ANDRES v. COURT OF APPEALS, ET AL.

  • G.R. No. L-69401 June 23, 1987 - RIZAL ALIH, ET AL. v. DELFIN C. GASTRO, ET AL.

  • G.R. Nos. L-59495-97 June 26, 1987 - GREGORIO GONZALES v. COURT OF APPEALS, ET AL.

  • A.M. No. R-251-P June 30, 1987 - AGAPITO BARENO, ET AL. v. IGNACIO CABAUATAN

  • A.M. No. 2538 June 30, 1987 - AMANTE E. SANGLAY v. ANTONIO QUIRINO

  • G.R. No. L-26344 June 30, 1987 - HAWAIIAN-PHILIPPINE COMPANY v. ASOCIACION DE HACENDEROS DE SILAY-SARAVIA, INC., ET AL.

  • G.R. No. L-30597 June 30, 1987 - GUILLERMO AZCONA, ET AL. v. JOSE JAMANDRE

  • G.R. No. L-38042 June 30, 1987 - PEOPLE OF THE PHIL. v. PEDRO ALCANTARA, ET AL.

  • G.R. No. L-43674 June 30, 1987 - YSMAEL MARITIME CORPORATION v. CELSO AVELINO

  • G.R. No. L-47369 June 30, 1987 - JOSEPH COCHINGYAN, JR., ET AL. v. R & B SURETY AND INSURANCE COMPANY, INC.

  • G.R. No. L-48237 June 30, 1987 - MADRIGAL & COMPANY, INC. v. RONALDO B. ZAMORA, ET AL.

  • G.R. No. L-48627 June 30, 1987 - FERMIN Z. CARAM, JR., ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. L-48955 June 30, 1987 - BERNARDO BUSUEGO v. COURT OF APPEALS, ET AL.

  • G.R. No. L-50997 June 30, 1987 - SUMMIT GUARANTY AND INSURANCE COMPANY, INC. v. JOSE C. DE GUZMAN

  • G.R. No. L-51065-72 June 30, 1987 - ARTURO A. MEJORADA v. SANDIGANBAYAN, ET AL.

  • G.R. No. L-51216 June 30, 1987 - AGATON T. LANDICHO, ET AL. v. RICARDO P. TENSUAN

  • G.R. No. L-51841 June 30, 1987 - REMIGIO QUIQUI, ET AL. v. ALEJANDRO R. BONCAROS

  • G.R. No. L-52352-57 June 30, 1987 - VALENTINO G. CASTILLO v. SANDIGANBAYAN, ET AL.

  • G.R. No. L-53373 June 30, 1987 - MARIO FL. CRESPO v. LEODEGARIO L. MOGUL

  • G.R. No. L-53961 June 30, 1987 - NATIONAL DEVELOPMENT COMPANY v. COMMISSIONER OF INTERNAL REVENUE

  • G.R. No. L-55354 June 30, 1987 - BANCO FILIPINO SAVINGS AND MORTGAGE BANK v. BERNARDO P. PARDO

  • G.R. No. L-55480 June 30, 1987 - PACIFICA MILLARE v. HAROLD M. HERNANDO

  • G.R. No. L-56283 June 30, 1987 - PEOPLE OF THE PHIL. v. RUBEN ORNOZA, ET AL.

  • G.R. No. L-61932 June 30, 1987 - ENRIQUE P. SYQUIA v. COURT OF APPEALS, ET AL.

  • G.R. No. L-64898 June 30, 1987 - IN RE: NICOLAS BUENO, JR., ET AL. v. MANOLO REYES, ET AL.

  • G.R. No. L-65718 June 30, 1987 - NATIONAL DEVELOPMENT COMPANY, ET AL. v. WILFREDO HERVILLA

  • G.R. No. L-65889 June 30, 1987 - PETRA DUENAS v. PELAGIO S. MANDI

  • G.R. No. L-67881 June 30, 1987 - PILIPINAS BANK v. INTERMEDIATE APPELLATE COURT, ET AL.

  • G.R. No. L-68624 June 30, 1987 - BARTOLOME ALONZO v. INTERMEDIATE APPELLATE COURT, ET AL.

  • G.R. No. L-69294 June 30, 1987 - ZACARIAS COMETA, ET AL. v. INTERMEDIATE APPELLATE COURT, ET AL.

  • G.R. No. L-69854 June 30, 1987 - MILAGROS ROSAURO, ET AL. v. PABLO CUNETA

  • G.R. No. L-70623 June 30, 1987 - ST. DOMINIC CORPORATION v. INTERMEDIATE APPELLATE COURT, ET AL.

  • G.R. No. 70639 June 30, 1987 - PEOPLE OF THE PHIL. v. PEDRO DOLLANTES, ET AL.

  • G.R. No. 71462 June 30, 1987 - PEOPLE OF THE PHIL. v. ALBERTO CRUZ, SR.

  • G.R. No. 71510 June 30, 1987 - PEOPLE OF THE PHIL. v. TEODORICO SILFAVAN

  • G.R. No. 71917 June 30, 1987 - BELISLE INVESTMENT & FINANCE CO., INC., ET AL. v. STATE INVESTMENT HOUSE, INC., ET AL.

  • G.R. No. 72354 June 30, 1987 - PEOPLE OF THE PHIL. v. ANTONIO PEÑA, JR.

  • G.R. No. 72645 June 30, 1987 - LUZON SURETY COMPANY, INC. v. INTERMEDIATE APPELLATE COURT, ET AL.

  • G.R. No. 73893 June 30, 1987 - MARGARITA SURIA, ET AL. v. INTERMEDIATE APPELLATE COURT, ET AL.

  • G.R. No. 74953 June 30, 1987 - PEOPLE OF THE PHIL. v. ANTONIO LEGASPI, ET AL.

  • G.R. No. 74957 June 30, 1987 - ROBERTO VALLARTA, ET AL. v. INTERMEDIATE APPELLATE COURT, ET AL.

  • G.R. No. 75029 June 30, 1987 - PEOPLE OF THE PHIL. v. SIEGFRED FAJARDO

  • G.R. No. 75287 June 30, 1987 - HOUSE INT’L. BUILDING TENANTS ASSOCIATION, INC. v. INTERMEDIATE APPELLATE COURT, ET AL.

  • G.R. No. 76145 June 30, 1987 - CATHAY INSURANCE CO. v. COURT OF APPEALS, ET AL.

  • G.R. No. 77148 June 30, 1987 - HEIRS OF MARIANO LACSON, ET AL. v. AMELIA K. DEL ROSARIO, ET AL.

  • G.R. No. 77154 June 30, 1987 - JESUS DEL ROSARIO v. JAIME HAMOY, ET AL.