KUENZLE & STREIFF VS.

MACKE & CHANDLER

G.R. NO. 5295
DECEMBER 16, 1909

FACTS

On or about the month of January 1907, the sheriff Jose Desiderio levied upon the
property of the plaintiff by virtue of an execution issued upon a judgment secured by
Macke & Chandler against Stanley &Krippendorf. The plaintiff notified the sheriff that it
was the owner of the goods and forbade the sale of such under said execution. However,
notwithstanding such claim, the sheriff proceeded with the sale of goods under execution.
Macke & Chandler was the purchaser of said good and the same were delivered to it. The
defendants allege that the property described by the plaintiff and sold at the execution
sale referred to was not the property of the plaintiff at the time of said levy and sale, but
was the property of Stanley & Krippendorf, who were in possession of the same at the
time of such levy. The defendants also alleged that Stanley & Krippendorf, being
indebted in a considerable sum to the plaintiff in this case, attempted to sell by an
instrument in writing the property in question.

ISSUE & RULING

WHETHER THE INSTRUMENT OF SALE HAS THE EFFECT OF A VALID

TRANSFER OF PROPERTY

The ownership of personal property cannot be transferred to the prejudice of third

persons except by delivery of the property itself, and a sale without such delivery gives
the would-be purchaser no rights in said property except those of a creditor.

A bill of sale of personal property, executed as a private document and unrecorded, the
property described in said instrument not having been delivered but remaining
exclusively in possession of the vendor, can have no effect against a person dealing with
the property upon the faith of appearances.
ADDISON VS. FELIX 
G.R. NO. L-12342            
AUGUST 3, 1918

FACTS

Petitioner sold four parcels of land to respondent spouses located in Lucena City.
Respondents paid 3K for the purchase price and promised to pay the remaining by
installment. The contract provides that the purchasers may rescind the contract within one
year after the issuance of title on their name. The petitioner went to Lucena for the survey
designation and delivery of the land but only two parcels were designated and two-thirds
of it was in possession of a Juan Villafuerte. The other parcels were not surveyed and
designated by petitioner. The petitioner demanded from respondent the payment of the
first installment but the latter contends that there was no delivery and as such, they are
entitled to get back the P3K purchase price they gave upon the execution of the contract.

ISSUE & RULING

WHETHER OR NOT THERE WAS A VALID DELIVERY

The record shows that the plaintiff did not deliver the thing sold. With respect to two of
the parcels of land, he was not even able to show them to the purchaser; and as regards
the other two, more than two-thirds of their area was in the hostile and adverse possession
of a third person.

It is true that the same article declares that the execution of a public instruments is
equivalent to the delivery of the thing which is the object of the contract, but, in order
that this symbolic delivery may produce the effect of tradition, it is necessary that the
vendor shall have had such control over the thing sold that, at the moment of the sale, its
material delivery could have been made. It is not enough to confer upon the purchaser the
ownership and the right of possession. The thing sold must be placed in his control.
When there is no impediment whatever to prevent the thing sold passing into the tenancy
of the purchaser by the sole will of the vendor, symbolic delivery through the execution
of a public instrument is sufficient. But if there is an impediment, delivery cannot be
deemed effected.
PASAGUI V. VILLABLANA
G.R. NO. L-21998
NOVEMBER 10, 1975

FACTS

Plaintiffs bought a property in Leyte from Estaquia and Catalina Bocar and that
corresponding document of sale was executed, notarized and recorded in the Registry of
Deeds. Before they could take possession of the property, defendant spouses illegally and
without any right, took possession of the property harvesting coconuts from the coconut
plantation thus depriving plaintiffs of its possession. Despite Plaintiffs demanded to
surrender the property and its possession, the latter failed or refused to return said parcel
of land.

ISSUE & RULING

WHETHER OR NOT THE RULE OF THE EXECUTION OF PUBLIC

INSTRUMENT IS EQUIVALENT TO DELIVERY ABSOLUTE

Yes. It is true that the execution of the deed of absolute sale in a public instrument is
equivalent to delivery of the land subject of the sale. This presumptive delivery only
holds true when there is no impediment that may prevent the passing of the property from
the hands of the vendor into those of the vendee. It can be negated by the reality that the
vendees actually failed to obtain material possession of the land subject of the sale. It
appears from the records of the case at bar that plaintiffs-appellants had not acquired
physical possession of the land since its purchase.
DY, JR. V. COURT OF APPEALS
G.R. NO. 92989            
JULY 8, 1991

FACTS

Wilfredo Dy purchased a truck and a farm tractor through Libra which was also
mortgaged with the latter, as a security to the loan. Petitioner, expresses his desire to
purchased his brother’s tractor in a letter to Libra which also includes his intention to
shoulder its mortgaged. Libra approved the request. At the time that Wilfredo Dy
executed a deed of absolute sale in favor of petitioner, the tractor and truck were in the
possession of Libra for his failure to pay the amortization. When petitioner finally
fulfilled its obligation to pay the tractor, Libra would only release the same only if he
would also pay for the truck. In order to fulfill Libra condition, petitioner convinced his
sister to pay for the remaining truck, to which she released a check amounting to P22K.
Libra however, insisted that the check must be first cleared before it delivers the truck
and tractor.

Meanwhile, another case was pending in Cebu as a case to recover for a sum of money.
By a writ of execution the court in Cebu ordered to seize and levy the tractor which was
in the premise of Libra, it was sold in a public auction to which it was purchased by
Gelac. The latter then sold the tractor to Antonio Gonzales.

ISSUE & RULING

WHETHER OR NOT THERE WAS A CONSUMMATED SALE BETWEEN

PETITIONER AND LIBRA

The relationship between Libra and the petitioner is not one of sale but still a mortgage.
The payment of the check was actually intended to extinguish the mortgage obligation so
that the tractor could be released to the petitioner. It was never intended nor could it be
considered as payment of the purchase price because the relationship between Libra and
the petitioner is not one of sale but still a mortgage. The clearing or encashment of the
check which produced the effect of payment determined the full payment of the money
obligation and the release of the chattel mortgage. It was not determinative of the
consummation of the sale. The transaction between the brothers is distinct and apart from
the transaction between Libra and the petitioner. The contention, therefore, that the
consummation of the sale depended upon the encashment of the check is untenable.
POWER COMMERCIAL AND INDUSTRIAL CORP. V. CA
G.R. NO. 119745
JUNE 20, 1997

FACTS

Petitioner company entered into a contract of sale with the respondent spouses involving
a parcel of land in Makati City. The parties agreed that petitioner would pay private
respondents spouses Quiambao P108K as down payment, and the balance of P295K upon
the execution of the deed of transfer of the title. Further, petitioner assumed, as part of the
purchase price, the existing mortgage on the land. In full satisfaction thereof, he paid
P79K to respondent bank.

Respondent spouses mortgaged again said land to respondent bank to guarantee a loan of
which was paid to respondent spouses. Petitioner agreed to assume payment of the loan
and the parties executed a Deed of Absolute Sale With Assumption of Mortgage. On the
same date, petitioner submitted to respondent bank said deed with a formal application
for assumption of mortgage. Respondent bank informed respondent spouses that, for
petitioner’s failure to submit the papers necessary for approval, the application for
assumption of mortgage was considered withdrawn; that the outstanding balance of
P145K was deemed fully due and demandable.

Petitioner filed a case for rescission and damages against respondent spouses and
demanded the return of the payments it made on the ground that its assumption of
mortgage was never approved. While this case was pending, the mortgage was
foreclosed. The property was  subsequently bought by respondent bank during the public
auction.

The Trial Court ruled that the failure of respondent spouses to deliver actual possession to
petitioner entitled the latter to rescind the sale, and in view of such failure and of the
denial of the latter’s assumption of mortgage, respondent bank was obliged to return the
payments made by the latter. The CA reversed the trial court decision. It held that the
deed of sale between respondent spouses and petitioner did not obligate the former to
eject the lessees from the land in question as a condition of the sale, nor was the
occupation thereof by said lessees a violation of the warranty against eviction.
 ISSUE & RULING

WHETHER OR NOT PETITIONER FAILED TO ESTABLISH ANY BREACH

OF THE WARRANTY AGAINST EVICTION.

A breach of this warranty requires the concurrence of the following circumstances: (1)
The purchaser has been deprived of the whole or part of the thing sold; (2) This eviction
is by a final judgment; (3) The basis thereof is by virtue of a right prior to the sale made
by the vendor; and (4) The vendor has been summoned and made co-defendant in the suit
for eviction at the instance of the vendee.

In the absence of these requisites, a breach of the warranty against eviction under Article
1547 cannot be declared. Petitioner argues in its memorandum that it has not yet ejected
the occupants of said lot, and not that it has been evicted therefrom. As correctly pointed
out by Respondent Court, the presence of lessees does not constitute an encumbrance of
the land, nor does it deprive petitioner of its control thereof. We note, however, that
petitioner’s deprivation of ownership and control finally occurred when it failed and/or
discontinued paying the amortizations on the mortgage, causing the lot to be foreclosed
and sold at public auction. But this deprivation is due to petitioner’s fault, and not to any
act attributable to the vendor-spouses. Because petitioner failed to impugn its integrity,
the contract is presumed, under the law, to be valid and subsisting
FLORENDO V. FOZ
G.R. NO. L-6565            
OCTOBER 24, 1911

FACTS

Defendant executed in Manila a contract, ratified before a notary, obligating himself to

deliver his house and lot for a consideration of P6K to Jose Florendo. The latter already
paid P2K of the purchase prize. In the contract, plaintiff fixed the period of the payment
of the prize wherein plaintiff has to pay the remainder of the prize when he goes to Vigan
or if not to pay to the Church wherein he has a debt and to obtain the title of the subject
matter of the sale. Defendant went to Vigan, plaintiff tendered payment of the remainder
of the prize, however, the former refused, saying that the true prize of the sale recorded in
the other instrument was P10K. As defendant refused payment, plaintiff filed a suit to
comply with the contract of absolute purchase and sale, by delivering to the plaintiff the
property sold

ISSUE & RULING

WHETHER OR NOT THE PLAINTIFF CAN COMPEL THE DEFENDANT TO

DELIVER HIS PROPERTY PURSUANT TO THE NOTARIZED CONTRACT.

Yes. The contract is valid and effective. From the validity and force of the contract is
derived the obligation on the part of the vendor to deliver the thing sold. Pursuant to the
contract, it can’t be found that the payment of the prize is a precondition for the delivery
of the thing. There was no need, therefore, of assent on the part of the plaintiff to pay the
P4,000, the remainder of the price, in order to oblige the defendant unconditionally to
deliver the property sold. With still more reason should the defendant be compelled to
effect the material delivery of the property, since, after the lapse of the period for the
delivery of the price, the plaintiff hastened to pay it and, on account of the defendant’s
refusal to receive it, duly deposited it, in order to avoid the consequences that might issue
from delinquency in the payment of a sum entrusted to him for a fixed period.
PHILIPPINE SUBURBAN DEV’T. CORP. V. THE AUDITOR GENERAL
G.R. NO. L-19545
APRIL 18, 1975

FACTS

Petitioner, as authorized by the President, entered into a contract embodied in a public

instrument entitled “Deed of Absolute Sale” whereby the former conveyed unto the latter
the unoccupied portion of the Sapang Palay Estate. This was not registered in the Office
of the Register of Deeds until March 14, 1961, due to the fact, that the People’s Homesite
and Housing Corporation could not at once advance the money needed for registration
expenses.

On April 12, 1961, the Provincial Treasurer of Bulacan requested the People’s Homesite
and Housing Corporation to withhold the amount of P30K from the purchase price to be
paid by it to the Philippine Suburban Development Corporation. Said amount represented
the realty tax due on the property involved for the calendar year 1961. Petitioner paid
under protest the abovementioned amount and thereafter, by letter, requested then
Secretary of Finance to order a refund of the amount so paid. Upon recommendation of
the Provincial Treasurer of Bulacan, said request was denied by the Secretary of Finance.

ISSUE & RULING

WHETHER OR NOT THERE WAS ALREADY A VALID TRANSFER OF

OWNERSHIP BETWEEN THE PARTIES AND THUS PETITIONER IS
ENTITLED FOR A REFUND.

Yes, there was already a valid transfer of ownership. Under the civil law, delivery
(tradition) as a mode of transmission of ownership maybe actual (real tradition) or
constructive (constructive tradition). When the sale of real property is made in a public
instrument, the execution thereof is equivalent to the delivery of the thing/object of the
contract, if from the deed the contrary does not appear or cannot clearly be inferred. In
other words, there is symbolic delivery of the property subject of the sale by the
execution of the public instrument, unless from the express terms of the instrument, or by
clear inference therefrom, this was not the intention of the parties made.
In the case at bar, there is no question that the vendor had actually placed the vendee in
possession and control over the thing sold, even before the date of the sale. The condition
that petitioner should first register the deed of sale and secure a new title in the name of
the vendee before the latter shall pay the balance of the purchase price, did not preclude
the transmission of ownership. In the absence of an express stipulation to the contrary,
the payment of the purchase price of the good is not a condition precedent to the transfer
of title to the buyer, but title passes by the delivery of the goods. It goes without saying
that the petitioner is entitled for a refund.
BOARD OF LIQUIDATORS VS EXEQUIEL FLORO
G.R. NO. L-15155           
DECEMBER 29, 1960

FACTS

Melencio Malabanan entered into an agreement with the Board of Liquidators for the
salvage of surplus properties sunk in certain waters. They agreed that Malabanan was
assigned the right, title and interest in and to all the surplus properties salvaged, and shall
therefore pay the Government for such which shall be made monthly. Subsequently,
Malabanan filed in the CFI a petition for voluntary insolvency which listed the Board and
Exequiel Floro as creditors; as well as several pieces of steel mattings obtained from the
waters. The Board claimed that they are the owners of the steel mattings. Floro opposed
this and contended that such steel mattings are owned by Eulalio Legaspi by virtue of a
deed of sale executed in his favor, executed by Floro pursuant to a previous contract
between Malabanan and Floro.

The CFI declared Malabanan as the owner of the steel mattings under his contract with
the board, thus, Floro was properly authorized to dispose of the mattings (sale to
Legaspi). The Board contends that Malabanan did not acquire ownership over the steel
mattings for failure to comply with certain terms of the contract, allegedly constituting
conditions precedent for the transfer of title.

ISSUE & RULING

WHETHER OR NOT DELIVERY OF THE SURPLUS PROPERTIES

SALVAGED WERE NEVER INTENDED TO BE DELIVERED TO
MALABANAN.

There is nothing in the terms of the public instrument in question from which an intent to
withhold delivery or transfer of title may be inferred. While there can be reservation of
title in the seller until full payment of the price or, until fulfillment of a condition; and
while execution of a public instrument amounts to delivery only when from the deed the
contrary does not appear or cannot clearly be inferred, there is nothing in the said contract
which may be deemed a reservation of title, or from which it may clearly be inferred that
delivery was not intended. The contention that there was no delivery is incorrect. While
there was no physical tradition, there was one by agreement (traditio longa manu).

STA. ANA VS. HERNANDEZ

G.R. NO. L-16394     
DECEMBER 17, 1966

FACTS

Spouses Jose Santa Ana, Jr. and Lourdes Sto. Domingo sold a land in Bulacan to
respondent Rosa Hernandez for P11,000. The boundaries of the land were stated in the
deed of sale and its approximate land area. After the sale (there were two other previous
sales to different vendees of other portions of the land), the petitioners-spouses caused the
preparation of a subdivision plan. Rosa Hernandez, however, unlike the previous
vendees, did not conform to the plan and refused to execute an agreement of subdivision
and partition for registration and refused to vacate the areas that she had occupied.
Instead, she caused the preparation of a different subdivision plan, which was approved
by the Director of Lands.

Petitioners-spouses filed suit against respondent Rosa Hernandez in the Court of First
Instance of Bulacan, claiming that said defendant was occupying an excess of 17,000
square meters in area of what she had bought from them. Defendant Rosa Hernandez, on
the other hand, claimed that the alleged excess, was part of the areas that she bought.

ISSUE & RULING

WON THE EXCESS AREA OCCUPIED BY HERNANDEZ IS PART OF THE

LAND SOLD.

The sale involves a definite and identified tract, a corpus certum, that obligated the
vendors to deliver to the buyer all the land within the boundaries, irrespective of whether
its real area should be greater or smaller than what is recited in the deed.

To hold the buyer to no more than the area recited on the deed, it must be made clear
therein that the sale was made by unit of measure at a definite price for each unit. The
sale in this case only involves the definite boundaries but only approximate land areas.
As such, Art 1542 concerning the sale for lump sum must be considered.
ASIAIN V. JALANDONI
G.R. NO. L-20435
OCTOBER 23, 1923

FACTS

Asiain said to Jalandoni that he was willing to sell a portion of his hacienda for the sum
of P55K. With a wave of his hand, Asiain indicated the tract of land in question,
affirming that it contained between 25 and 30 hectares, and that the crop of sugar cane
then planted would produce not less than 2K piculs of sugar. But Jalandoni, remaining
doubtful as to the extent of the land and as to the amount of crop on it. Once in
possession of the land, Jalandoni did two things. He had the sugar cane ground in La
Carlota Sugar Central with the result that it gave and output of P800 piculs and 23 cates
of centrifugal sugar. When opportunity offered, he secured the certificate of title of
Asiain and produced a surveyor to survey the land.

Of the purchase price, Jalandoni had paid P30K, leaving a balance unpaid of P25K. To
recover the sum of P25K from Jalandoni or to obtain the certificate of title and the rent
from him.

ISSUE & RULING

WHETHER OR NOT THE CONTRACT CAN BE RESCINDED?

Coordinating more closely the law and the facts in the instant case, we reach the
following conclusions: This was not a contract of hazard. It was a sale in gross in which
there was a mutual mistake as to the quantity of land sold and as to the amount of the
standing crop. The mistake of fact as disclosed not alone by the terms of the contract but
by the attendant circumstances, which it is proper to consider in order to throw light upon
the intention of the parties, is, as it is sometimes expressed, the efficient cause of the
concoction. The mistake with reference to the subject-matter of the contract is such that,
at the option of the purchaser, it is rescindable. Without such mistake the agreement
would not have been made and since this is true, the agreement is inoperative and void. It
is not exactly a case of overreaching on the plaintiff’s part, or of misrepresentation and
deception, or of fraud, but is more nearly akin to a bilateral mistake for which relief
should be granted. Specific performance of the contract can therefore not be allowed at
the instance of the vendor.