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[G.R. No. 150217. November 19, 2001]

JOSE SALDANA vs. CONFEDERATION PROPERTIES, INC.

THIRD DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated NOV 19 2001.

G.R. No. 150217 (Jose Saldana vs. Confederation Properties, Inc.)

The present controversy arose from the Authority to Sell executed by Tomas Topacio and Solomon Topacio (Topacio brothers) in favor of petitioner to sell the formers' property situated at Burol, Dasmari�as, Cavite (TCT No. 261719, Registry of Deeds - Trece Martires, Cavite).

The Topacio brothers obliged themselves to pay petitioner and his partner, George Magsila, 5% of the agreed selling price pegged at P13,478,600 plus whatever amount the brokers may obtain by overprice on the condition that the expenses for capital gains tax and the ejectment of tenants on the property be deducted therefrom.

Petitioner was able to close a deal with respondent Confederation Properties, Inc. (CPI, for brevity), selling the property for P20 million. After consummation of the sales transaction, it appears that the expenses incurred in evicting the tenants amounted to P3,715,000.00, while the net capital gains tax amounted to P701,793.75. Under the agreed terms of their Authority to Sell, petitioner should receive a balance of P2,104,606.30 from the gross amount of overprice.

Petitioner sued the Topacio brothers, as well as the buyer, CPI. The trial court held both defendants solidarily liable for the unpaid commission of P2,104,606.30 plus legal rate of interest thereon from time of demand, and attorney's fees equivalent to 25% of the total amount due.

The Court of Appeals, on review, did not agree that respondent CPI must be held solidarily liable with the Topacio brothers for the said amounts.

Hence, the present petition.

We find the petition unmeritorious.

There is no question that the Authority to Sell, from which the obligation to pay P2,104,606.30 arises is binding only between panics (Article 1311, Civil Code). Petitioner relies upon Article 1314 of the same Code, which states that "Any third person who induces another to violate his contract shall be liable for damages to the other contracting party."

The Court of Appeals correctly held that CPI is not guilty of unduly influencing the Topacio brothers into violating the terms of the Authority to Sell between them and petitioner.

According to petitioner, CPI refused to pay the balance of the purchase price to the Topacio brothers because the latter failed to deliver the DAR land conversion clearance and the NHA right of way. CPI charged the expenses it incurred in securing the DAR clearance to the balance of the purchase price and apparently this is the reason used by the Topacio brothers for refusing to pay petitioner the amount due to them.

Verily, CPI's alleged refusal to pay the Topacio brothers the balance of the purchase price arose from their contract of sale. If CPI believes that the expenses it incurred in securing the DAR clearance should be charged against the Topacio brothers, then, withholding part of the purchase price, which is surely a valid action on its part, cannot, in anyway, constitute an undue interference upon the contract between the petitioner and the Topacio brothers based on the Authority to Sell. Petitioner's cause of action for the unpaid commission is solely against the Topacio brothers. The Court cannot hold CPI liable under Article 1314 of the Civil Code.

WHEREFORE, the petition is dismissed for lack of merit.

SO ORDERED.

Very truly yours,

(Sgd.) JULIETA Y. CARREON

Clerk of Court


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