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    G.R. No. 138018 July 26, 2002

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    ANTHONY SALVADICO
    The Supreme Court affirmed the decision declaring the Deed of Sale between Reynes and Montecillo void ab initio. While the Deed stated the purchase price of P47,000 had been paid, Montecillo never actually paid Reynes. As there was a total lack of consideration, the Deed was void from the beginning rather than merely voidable. The Court also found a lack of consent as the parties disagreed on how the payment would be made. The lot remained the property of Reynes who was free to sell it to the Abucays.

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    G.R. No. 138018 July 26, 2002

    Uploaded by

    ANTHONY SALVADICO
    55 views3 pages
    The Supreme Court affirmed the decision declaring the Deed of Sale between Reynes and Montecillo void ab initio. While the Deed stated the purchase price of P47,000 had been paid, Montecillo never actually paid Reynes. As there was a total lack of consideration, the Deed was void from the beginning rather than merely voidable. The Court also found a lack of consent as the parties disagreed on how the payment would be made. The lot remained the property of Reynes who was free to sell it to the Abucays.

    Original Title

    Montecillo-v.-Reynes

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    The Supreme Court affirmed the decision declaring the Deed of Sale between Reynes and Montecillo void ab initio. While the Deed stated the purchase price of P47,000 had been paid, Montecillo never actually paid Reynes. As there was a total lack of consideration, the Deed was void from the beginning rather than merely voidable. The Court also found a lack of consent as the parties disagreed on how the payment would be made. The lot remained the property of Reynes who was free to sell it to the Abucays.

    Copyright:

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

    G.R. No. 138018 July 26, 2002

    Uploaded by

    ANTHONY SALVADICO
    The Supreme Court affirmed the decision declaring the Deed of Sale between Reynes and Montecillo void ab initio. While the Deed stated the purchase price of P47,000 had been paid, Montecillo never actually paid Reynes. As there was a total lack of consideration, the Deed was void from the beginning rather than merely voidable. The Court also found a lack of consent as the parties disagreed on how the payment would be made. The lot remained the property of Reynes who was free to sell it to the Abucays.

    Copyright:

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

    University of Mindanao - College of Legal Education

    SALES

    Case Name Montecillo v. Reynes

    Docket Number | Date G.R. No. 138018            July 26, 2002

    Ponente CARPIO, J.:

    Petitioners RIDO MONTECILLO

    Respondents IGNACIA REYNES and SPOUSES REDEMPTOR and


    ELISA ABUCAY

    Case summary (Maximum of 5 Reynes and Sps. Abucay filed complaint against
    sentences) Montecillo, regarding a lot in Mabolo, Cebu City. Reynes
    signed a Deed of Sale with Montecillo, who agreed to pay
    the price w/in 1 month. He failed to do so, but he also
    refused to return the DoS. Reynes executed a document
    unilaterally revoking the sale, then sold the lot to the Sps.
    Abucay. Montecillo however, was able to register the lot in
    his name, claiming he was a buyer in good faith and for
    value. The trial court and CA declared the DoS to
    Montecillo void, and this was affirmed by the SC.

    Doctrine Effect of non-payment of price;

    Where the deed of sale states that the purchase price


    has been paid but in fact has never been paid, the
    deed of sale is null and void ab initio for lack of
    consideration.

    Trigger words/Phrase

    Relevant Facts

     Ignacia Reynes owned a lot (446 m2) in Mabolo, Cebu City and sold 158 m2 to the Sps.
    Abucay in 1981.
     In 1984, Reynes signed a Deed of Sale conveying the Mabolo lot to Montecillo for
    P47,000 to be paid in 1 month. Montecillo did not pay on time, but refused to return the
    DoS. Reynes executed a document revoking the sale, then sold the entire lot to Sps.
    Abucay.
     However, Montecillo was able to register the land in his name, so Reynes and the Sps.
    Abucay filed a complaint for Declaration of Nullity and Quieting of Title against
    Montecillo, alleging that there was lack of consideration.
     Montecillo claimed he was a buyer in good faith and for value, as he allegedly already
    paid the P47,000. Yet, he admitted having a balance of P10,000. Supposedly, he had
    paid P50,000 to Cebu Ice Storage for the release of a chattel mortgage debt (of Jayag)
    which was a lien on the land. He alleged that he paid real property tax and capital gains
    tax for the lot.
     Reynes claimed Montecillo secured the release of chattel mortgage through machination,
    and took advantage of the taxes paid by the Sps. Abucay to transfer the title to his name.
    She denied anything to do with Jayag’s mortgage debt.
     The trial court declared the DoS to Montecillo null and void, because there was no cause
    or consideration, considering that he had never paid Reynes. Thus, the DoS produced no
    legal effect. The CA affirmed the decision in toto, hence this appeal.

    Ratio Decidendi

    W/N Montecillo should The DoS did not even state that the P47,000 was to be paid to
    have paid the purchase Cebu Ice Storage. Montecillo did not produce evidence showing
    price to Cebu Ice that Reynes agreed to the payment of the price to CIS. Applying
    Storage Art. 1420, payment to CIS would not extinguish the obligation of
    Montecillo to Reynes.
    ANSWER: NO
    It goes against common sense to think that Reynes would sell
    her land but not gain a single centavo from the sale, the price
    going to CIS instead. The trial court found that Reynes had no
    connection at all to Jayag’s mortgage debt with CIS. Thus,
    payment to CIS could not redound to the benefit of Reynes.

    W/N the Deed of Sale is Contracts have 3 essential requisites: consent, object, and
    void ab initio or only cause.
    rescissible Montecillo argues that the DoS is a valid sale because all three
    requisites are present, that there is only a non-payment of
    ANSWER: VOID AB consideration, which is just a breach of his obligation to pay on
    INITIO time. This should give rise to Reynes’ right to ask for specific
    performance or annulment of the obligation to sell. Reynes did
    not make a demand for payment, but revoked the DoS,
    Montecillo says the court should fix a period for payment of the
    balance.

    But, such arguments do not convince the court. The evidence


    shows that while the DoS appears supported by valuable
    consideration, Montecillo never actually paid Reynes P47,000.
    There was a total absence of consideration. He merely alleged
    that he had a remaining balance of P10,000.

    This is not merely a case of failure to pay the purchase price, but
    a contract that lacks a cause (hence it is void ab initio). Where
    the deed of sale states that the purchase price has been paid but
    in fact has never been paid, the deed of sale is null and void ab
    inito for lack of consideration.

    In Mapalo v. Mapalo – “a contract of sale is null and void and produces


    no effect whatsoever where the same is without cause or consideration
    in that the purchase price which appears thereon as paid has in fact
    never been paid”
    In Vda. De Catindig v. Heirs of Catalina Roque – “such a sale is non-
    existent or cannot be considered as consummated”

    Moreover, the contract is also void for lack of consent. There was
    a disagreement on the manner of payment, as Reynes expected
    Montecillo to pay directly the P47,000, while Montecillo thought
    he should pay the price to Cebu Ice Storage to settle the
    mortgage debt.

    Ruling

    Petiition is DENIED. Assailed Decision of the Court of Appeals is AFFIRMED. Costs against the
    petitioner.

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