Location via proxy:   [ UP ]  
[Report a bug]   [Manage cookies]                
Scribd Logo
Upload

Welcome to Scribd!

  • 158 views

    Deed of Sale Vs Equitable Mortgage

    Uploaded by

    jafernand
    The document discusses the difference between a deed of sale and an equitable mortgage under Philippine law. It provides an example case where the Supreme Court ruled that a purported deed of sale was actually an equitable mortgage based on several factors. Specifically, the Court found that (1) the sellers retained possession of the property, (2) the buyer retained part of the purchase price, and (3) the buyer granted numerous extensions to repay the loan after the sale, indicating the true intent was to secure a debt rather than finalize a sale. Philippine law presumes a contract of sale is an equitable mortgage if any of the circumstances listed in the Civil Code are present, including the seller retaining possession.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd

    Deed of Sale Vs Equitable Mortgage

    Uploaded by

    jafernand
    158 views3 pages
    The document discusses the difference between a deed of sale and an equitable mortgage under Philippine law. It provides an example case where the Supreme Court ruled that a purported deed of sale was actually an equitable mortgage based on several factors. Specifically, the Court found that (1) the sellers retained possession of the property, (2) the buyer retained part of the purchase price, and (3) the buyer granted numerous extensions to repay the loan after the sale, indicating the true intent was to secure a debt rather than finalize a sale. Philippine law presumes a contract of sale is an equitable mortgage if any of the circumstances listed in the Civil Code are present, including the seller retaining possession.

    Original Description:

    Deed of Sale vs Equitable Mortgage

    Original Title

    Deed of Sale vs Equitable Mortgage

    Copyright

    © Attribution Non-Commercial (BY-NC)

    Available Formats

    DOC, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    The document discusses the difference between a deed of sale and an equitable mortgage under Philippine law. It provides an example case where the Supreme Court ruled that a purported deed of sale was actually an equitable mortgage based on several factors. Specifically, the Court found that (1) the sellers retained possession of the property, (2) the buyer retained part of the purchase price, and (3) the buyer granted numerous extensions to repay the loan after the sale, indicating the true intent was to secure a debt rather than finalize a sale. Philippine law presumes a contract of sale is an equitable mortgage if any of the circumstances listed in the Civil Code are present, including the seller retaining possession.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    158 views3 pages

    Deed of Sale Vs Equitable Mortgage

    Uploaded by

    jafernand
    The document discusses the difference between a deed of sale and an equitable mortgage under Philippine law. It provides an example case where the Supreme Court ruled that a purported deed of sale was actually an equitable mortgage based on several factors. Specifically, the Court found that (1) the sellers retained possession of the property, (2) the buyer retained part of the purchase price, and (3) the buyer granted numerous extensions to repay the loan after the sale, indicating the true intent was to secure a debt rather than finalize a sale. Philippine law presumes a contract of sale is an equitable mortgage if any of the circumstances listed in the Civil Code are present, including the seller retaining possession.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    of 3
    At a glance
    Powered by AI
    The passage discusses the difference between a deed of sale and an equitable mortgage under Philippine law and analyzes a Supreme Court case that examined whether a deed of absolute sale was really an absolute sale or an equitable mortgage.

    A contract of sale will be presumed to be an equitable mortgage if: the price is unusually inadequate, the vendor remains in possession, an instrument extends the redemption period, the purchaser retains part of the purchase price, the vendor pays taxes, or it can be inferred the transaction was to secure a debt.

    The Supreme Court ruled that the contract between the parties was an equitable mortgage based on the circumstances that the Sps. Culla retained possession, Rockville kept part of the purchase price, and Rockville continued giving extensions to repay the loan.

    Deed of Sale vs.

    Equitable Mortgage
    Posted on November 11, 2009 by Hector M. de Leon Jr Under the Civil Code, an a reement that, on its !ace, loo"s li"e a sale may be considered an e#$itable mort a e. %rticle 1&02 o! the Civil Code 'rovides( %rt. 1&02. )he contract shall be 'res$med to be an e#$itable mort a e, in any o! the !ollo*in cases( +1, +2, -hen the 'rice o! a sale *ith ri ht to re'$rchase is $n$s$ally inade#$ate. -hen the vendor remains in 'ossession as lessee or other*ise.

    +/, -hen $'on or a!ter the e0'iration o! the ri ht to re'$rchase another instr$ment e0tendin the 'eriod o! redem'tion or rantin a ne* 'eriod is e0ec$ted. +1, +2, -hen the '$rchaser retains !or himsel! a 'art o! the '$rchase 'rice. -hen the vendor binds himsel! to 'ay the ta0es on the thin sold.

    +&, 3n any other case *here it may be !airly in!erred that the real intention o! the 'arties is that the transaction shall sec$re the 'ayment o! a debt or the 'er!ormance o! any other obli ation. 3n any o! the !ore oin cases, any money, !r$its, or other bene!it to be received by the vendee as rent or other*ise shall be considered as interest *hich shall be s$b4ect to the $s$ry la*s. 3n Rockville Excel International Exim Corporation vs. Spouses Oligario Culla and Bernardita Miranda, G.R. No. !!" #, Octo$er %, %&&', the 5$'reme Co$rt !aced the iss$e o! *hether a 6eed o! %bsol$te 5ale is really an absol$te sale o! real 'ro'erty or an e#$itable mort a e. )he 5$'reme Co$rt e0'lained the conce't o! an e#$itable mort a e as !ollo*s( %n e#$itable mort a e has been de!ined 7as one *hich altho$ h lac"in in some !ormality, or !orm or *ords, or other re#$isites demanded by a stat$te, nevertheless reveals the intention o! the 'arties to char e real 'ro'erty as sec$rity !or a debt, there bein no im'ossibility nor anythin contrary to la* in this intent.8 % contract o! sale is 'res$med to be an e#$itable mort a e *hen any o! the !ollo*in circ$mstances, en$merated in %rticle 1&02 o! the Civil Code, is 'resent. . . )he 'rovisions o! %rticle 1&02 shall also a''ly to a contract '$r'ortin to be an absol$te sale. 9or the 'res$m'tion o! an e#$itable mort a e to arise $nder %rticle 1&02, t*o +2, re#$isites m$st conc$r( +a, that the 'arties entered into a contract denominated as a contract o! sale. and, +b, that their intention *as to sec$re an e0istin debt by *ay o! a mort a e. %ny o! the circ$mstances laid o$t in %rticle 1&02, not the conc$rrence nor an over*helmin n$mber o! the en$merated

    circ$mstances, is s$!!icient to s$''ort the concl$sion that a contract o! sale is in !act an e#$itable mort a e. 3n several cases, *e have not hesitated to declare a '$r'orted contract o! sale to be an e#$itable mort a e based solely on one o! the en$merated circ$mstances $nder %rticle 1&02. )his a''roach !ollo*s the r$le that *hen do$bt e0ists on the nat$re o! the 'arties: transaction, the la* !avors the least transmission o! 'ro'erty ri hts. 3n Rockville, the 5$'reme Co$rt r$led that the contract bet*een the 'arties *as an e#$itable mort a e. %ccordin to the 5$'reme Co$rt( 3n the 'resent case, three attendant circ$mstances indicate that the '$r'orted sale *as in !act an e#$itable mort a e. 9irst, the 5's. C$lla retained 'ossession o! the 'ro'erty. 5econd, ;oc"ville "e't a 'art o! the '$rchase 'rice. )hird, as 'revio$sly disc$ssed, ;oc"ville contin$ed to ive the 5's. C$lla e0tensions on the 'eriod to re'ay their loan even a!ter the 'arties alle edly a reed to a dacion en 'a o. )hese circ$mstances, co$'led *ith the clear and $ne#$ivocal testimonies o! <li ario and =ernardita that the '$r'ose o! the 6eed o! %bsol$te 5ale *as merely to $arantee their loan, clearly reveal the 'arties: tr$e intention to e0ec$te an e#$itable mort a e and not a contract o! sale. )hat a contract *here the vendor remains in 'hysical 'ossession o! the land, as lessee or other*ise, is an e#$itable mort a e is *ell>settled. )he reason !or this r$le lies in the le al reality that in a contract o! sale, the le al title to the 'ro'erty is immediately trans!erred to the vendee. retention by the vendor o! the 'ossession o! the 'ro'erty is inconsistent *ith the vendee:s ac#$isition o! o*nershi' $nder a tr$e sale. 3t discloses, in the alle ed vendee, a lac" o! interest in the 'ro'erty that belies the tr$th!$lness o! the sale. %ccordin to ;oc"ville, it too" 'ossession o! the 'ro'erty, albeit constr$ctively and not thro$ h act$al occ$'ation. ;oc"ville contends, too, that its 'ossession o! the title to the 'ro'erty and its s$bse#$ent attem't to re ister the 'ro'erty in its name are clear indicators o! its intent to en!orce the contract o! sale. -e cannot a ree *ith these 'ositions. 3n the !irst 'lace, the 5's. C$lla retained act$al 'ossession o! the 'ro'erty and this *as never dis'$ted. ;oc"ville itsel! admits this in its 'etition, b$t claims in 4$sti!ication that since the 'ro'erty is conti $o$s to the site o! the 5's. C$lla:s !amily home, it *o$ld have been im'ossible !or;oc"ville to obtain act$al 'ossession o! the 'ro'erty. ;e ardless o! *here the 'ro'erty is located, ho*ever, i! the transaction had really been a sale as ;oc"villeclaimed, it sho$ld have asserted its ri hts !or the immediate delivery and 'ossession o! the lot instead o! allo*in the 5's. C$lla to !reely stay in the 'remises. 3ts !ail$re to do so s$ ests that ;oc"ville did not tr$ly intend to en!orce the contract o! sale. Moreover, *e observe that *hile ;oc"ville did ta"e ste's to re ister the 'ro'erty in its name, it did so more than t*o years a!ter the 6eed o! %bsol$te 5ale *as e0ec$ted, and only a!ter <li ario:s contin$ed !ail$re to 'ay the P2,000,000.00 loan. 3n addition, ;oc"ville admitted that it never 'aid the P1,200,000.00 balance to the 5's. C$lla. %s !o$nd by the ;)C, *hile ;oc"ville claims that it de'osited this amo$nt *ith May =an" o! Malaysia and noti!ied <li ario o! the de'osit, no evidence *as 'resented to s$''ort this claim.

    =esides, even i! this contention had been tr$e, the de'osit in a !orei n ban" *as neither a valid tender o! 'ayment nor an e!!ective consi nation. Lastly, the n$mero$s e0tensions ranted by ;oc"ville to <li ario to 'ay his debt a!ter the e0ec$tion o! the 6eed o! 5ale convince $s that the 'arties never intended to enter into a contract o! sale. instead, the intent *as merely to sec$re the 'ayment o! <li ario:s loan. %ll told, *e see no reason to de'art !rom the !indin s and concl$sions o! both the trial co$rt and the Co$rt o! %''eals.

    You might also like