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    Adelfa Properties, Inc. Vs CA

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    Paris Valencia
    The document summarizes a case regarding a contract dispute between Adelfa Properties and private respondents Rosario and Salud Jimenez over the sale of land. The agreement between the parties was entitled an "Exclusive Option to Purchase" but outlined terms of a contract to sell, not an option contract. Specifically, it did not mention Adelfa returning ownership if payment was not made, implying ownership would only transfer upon full payment. Additionally, Adelfa never took physical possession. The court ruled the document should be considered a perfected contract to sell, not an option, as the terms clearly defined the obligations of both parties upon acceptance, with only performance remaining.

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    Adelfa Properties, Inc. Vs CA

    Uploaded by

    Paris Valencia
    310 views3 pages
    The document summarizes a case regarding a contract dispute between Adelfa Properties and private respondents Rosario and Salud Jimenez over the sale of land. The agreement between the parties was entitled an "Exclusive Option to Purchase" but outlined terms of a contract to sell, not an option contract. Specifically, it did not mention Adelfa returning ownership if payment was not made, implying ownership would only transfer upon full payment. Additionally, Adelfa never took physical possession. The court ruled the document should be considered a perfected contract to sell, not an option, as the terms clearly defined the obligations of both parties upon acceptance, with only performance remaining.

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    Sales case law

    Original Title

    15. Adelfa Properties, Inc. vs CA

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    The document summarizes a case regarding a contract dispute between Adelfa Properties and private respondents Rosario and Salud Jimenez over the sale of land. The agreement between the parties was entitled an "Exclusive Option to Purchase" but outlined terms of a contract to sell, not an option contract. Specifically, it did not mention Adelfa returning ownership if payment was not made, implying ownership would only transfer upon full payment. Additionally, Adelfa never took physical possession. The court ruled the document should be considered a perfected contract to sell, not an option, as the terms clearly defined the obligations of both parties upon acceptance, with only performance remaining.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    310 views3 pages

    Adelfa Properties, Inc. Vs CA

    Uploaded by

    Paris Valencia
    The document summarizes a case regarding a contract dispute between Adelfa Properties and private respondents Rosario and Salud Jimenez over the sale of land. The agreement between the parties was entitled an "Exclusive Option to Purchase" but outlined terms of a contract to sell, not an option contract. Specifically, it did not mention Adelfa returning ownership if payment was not made, implying ownership would only transfer upon full payment. Additionally, Adelfa never took physical possession. The court ruled the document should be considered a perfected contract to sell, not an option, as the terms clearly defined the obligations of both parties upon acceptance, with only performance remaining.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 3

    Under the topic: Perfection of a Contract of Sale

    ADELFA PROPERTIES, INC. vs. COURT OF APPEALS, ROSARIO JIMENEZ-CASTANEDA


    and SALUD JIMENEZ [GR NO. 111238, January 25, 1995]

    FACTS:
    Private respondents Rosario and Salud, and their brothers Jose and Dominador were the registered co-
    owners of a parcel of land consisting of 17,710 sqm. covered by TCT No. 309773 situated in Barrio Culasi
    Las Pinas, Metro Manila.

    On July 28, 1988, Jose and Dominador sold their share (eastern portion of the land) to petitioner Adelfa
    Properties, pursuant to a “Kasulatan sa Bilihan ng Lupa”. Subsequently, a "Conrmatory Extrajudicial
    Partition Agreement" was executed by the Jimenezes, wherein the eastern portion of the subject lot,
    with an area of 8,855 square meters was adjudicated to Jose and Dominador Jimenez, while the
    western portion was allocated to herein private respondents.

    Thereafter, petitioner expressed interest in buying the wester portion of the property from private
    respondents. Accordingly, on November 25, 1989, an “Exclusive Option to Purchase” was executed
    between petitioner and private respondents, under the following terms and conditions: a) the selling price
    of said 8,655 sqm is P2,856,100.00; b) the sum of P50,000.00 received from Adelfa as option money shall
    be credited as partial payment upon the consummation of the sale and the balance of P2,856,100.00 to be
    paid on or before November 30, 1989; c) in case of default on the part of Adelfa to pay said balance, this
    option shall be cancelled and 50% of the option money to be forfeited in our [private respondent’s] favor
    and we will refund the remaining 50% of said option money upon the sale of said property to a third party;
    and d) all expenses including the corresponding capital gains tax, cost of documentary stamps are for the
    account of the vendors, and expenses for the registration of the deed of sale in the Registry of Deeds are for
    the account of Adelfa.

    A new owners copy of the certificate of title was issued (as the copy with respondent Salud was lost) and
    was kept by Adelfa’s counsel, Atty. Bernardo.

    However, before Adelfa could make payments, it received summons, together with a copy of a complaint
    filed by the nephews and nieces of private respondents against the latter, Jose and Dominador, and herein
    petitioner, for annulment of the deed of sale in favor of Household Corporation and recovery of ownership
    of the property covered by TCT No. 309773. Consequently, petitioner informed private respondents that it
    would hold payment of the full purchase price and suggested that private respondents settle the case with
    their nephews and nieces first. However, respondent Salud refused to heed the suggestion of petitioner and
    attributed the suspension of payment of the purchase price to “lack of word of honor”.

    On December 7, 1989, petitioner caused to be annotated on the title of the lots its contract with private
    respondents, and its contract with jose and Dominador Jimenez. However, on December 14, private
    respondents through a certain Francisca Jimenez, informed petitioner’s counsel, Atty. Bernardo that they
    were cancelling the transaction. In turn, Atty. Bernardo offered to pay the purchase price twice; however,
    they were both rejected by private respondents.

    On February 23, 1990 the RTC dismissed the civil case filed by the nephews and nieces of private
    respondents. A few days after, private respondents executed a Deed of Conditional Sale in favor a certain
    Emelyn Chua.
    In view of the dismissal of the case, Atty. Bernardo then wrote to private respondents that petitioner Adelfa
    is willing to pay the purchase price, and requested that the corresponding deed of Absolute Sale be executed.
    This, however, was ignored by private respondents.

    Private respondents then, through their counsel, sent a letter to petitioner, enclosing therein a check for
    P25,000.00 representing the refund of 50% of the option money paid under the exclusive option to purchase.
    In addition, private respondents requested Adelfa to return the owner’s duplicate copy of the certificate of
    title of respondent Salud. Petitioner failed to surrender such certificate, hence private respondents filed a
    civiil case before the RTC of Pasay for annulment of contract with damages, praying, among others, that
    the exclusive option to purchase be declared null and void; that petitioner be ordered to return the owner’s
    duplicate certificate of title; and the the annotation of the option contract on TCT No. 309773 be cancelled.

    The trial court directed the cancellation of the exclusive option to purchase. On appeal, respondent CA
    affirmed in toto the decision of the RTC. Hence, this petition.

    ISSUE: WON the agreement between Adelfa and private respondents was an option contract

    RULING: No. The agreement between the parties is a contract to sell, and not an option contract or
    a contract of sale.

    The distinction between a contract of sale and contract to sell is important. In a contract of sale, the title
    passes to the vendee upon the delivery of the thing sold; whereas in a contract to sell, by agreement the
    ownership is reserved in the vendor and is not to pass until the full payment of the price. In a contract of
    sale, the vendor has lost and cannot recover ownership until and unless the contract is resolved or rescinded;
    whereas in a contract to sell, title is retained by the vendor until the full payment of the price, such payment
    being a positive suspensive condition and failure of which is not a breach but an event that prevents the
    obligation of the vendor to convey title from becoming effective.

    There are two features which convince us that the parties never intended to transfer ownership to petitioner
    except upon full payment of the purchase price. Firstly, the exclusive option to purchase…does not mention
    that petitioner is obliged to return possession or ownership of the property as a consequence of non-
    payment. There is no stipulation anent reversion or reconveyance of the property to herein private
    respondents in the event that petitioner does not comply with its obligation. With the absence of such a
    stipulation, it may legally be inferred that the parties never intended to transfer ownership to the petitioner
    prior to the completion of payment of the purchase price.

    In effect, there was an implied agreement that ownership shall not pass to the purchaser until he head fully
    paid the price. Article 1478 of the Civil Code does not require that such a stipulation be expressly made.
    Consequently, an implied stipulation to that effect is considered valid and, therefore, binding and
    enforceable between the parties. It should be noted that under the law and jurisprudence, a contract which
    contains this kind of stipulation is considered a contract to sell.

    Secondly, it has not been shown that there was delivery of the property, actual or constructive, made to
    herein petitioner. Neither did petitioner take actual, physical possession of the property at any given time.

    Irrefragably, the controverted document should legally be considered as a perfected contract to sell. In
    addition, the fact that the document under discussion is entitled “Exclusive option to Purchase” is not
    controlling where the text thereof shows that it is a contract to sell.

    An option is not of itself a purchase, but merely secures the privilege to buy. On the other hand, a contract,
    like a contract to sell, involves a meeting of minds between two persons whereby one binds himself, with
    respect to the other, to give something or to render some service. Contracts, in general, are perfected by
    mere consent, which is manifested by the meeting of the offer and the acceptance upon the thing and the
    cause which are to constitute the contract. The offer must be certain and the acceptance absolute. In the
    case at bar, the agreement as to the object, the price of the property, and the terms of payment was clear
    and well-defined. Hence, there was nothing left to be done except the performance of the respective
    obligations of the parties.

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