Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&view=article&id=83626:57678&catid=1585&Itemid=566
Timestamp: 2019-04-19 10:56:53+00:00

Document:
G.R. No. 179205, July 30, 2014 - HEIRS OR REYNALDO DELA ROSA, NAMELY: TEOFISTA DELA ROSA, JOSEPHINE SANTIAGO AND JOSEPH DELA ROSA, Petitioners, v. MARIO A. BATONGBACAL, IRENEO BATONGBACAL, JOCELYN BATONGBACAL, NESTOR BATONGBACAL AND LOURDES BATONGBACAL, Respondents.
HEIRS OR REYNALDO DELA ROSA, NAMELY: TEOFISTA DELA ROSA, JOSEPHINE SANTIAGO AND JOSEPH DELA ROSA, Petitioners, v. MARIO A. BATONGBACAL, IRENEO BATONGBACAL, JOCELYN BATONGBACAL, NESTOR BATONGBACAL AND LOURDES BATONGBACAL, Respondents.
This is a Petition for Review on Certiorari1 pursuant to Rule 45 of the Revised Rules of Court, assailing the 7 December 2006 Decision2 and 8 August 2007 Resolution3 of the Fourth Division of the Court of Appeals in CA-G.R. CV No. 64172. In its assailed Resolution, the appellate couti modified its earlier ruling and proceeded to direct petitioners to execute the requisite Deed of Sale over the subject property.
The subject prope1iy consists of a 3,750 square meter-portion of the 15,001 square meters parcel of land situated in Barrio Saog, Marilao, Bulacan denominated as Lot No. 1, and registered under Transfer Certificate of Title (TCT) No. T-1 074494 under the names of Reynaldo Del a Rosa (Reynaldo), Eduardo Dela Rosa (Eduardo), Araceli Del a Rosa (Araceli) and Zenaida Dela Rosa (Zenaida).
Subsequent to the execution of the said agreement, Mario and Guillermo, on their own instance, initiated a survey to segregate the area of 3,750 square meters from the whole area covered by TCT No. T-107449, delineating the boundaries of the subdivided parts. As a result, they came up with a subdivision plan specifically designating the subject property signed by a Geodetic Engineer.6 Mario and Guillermo thereafter made several demands from Reynaldo to deliver the SPA as agreed upon, but such demands all went unheeded.
Consequently, Guillermo and Mario initiated an action for Specific Performance or Rescission and Damages before the Regional Trial Court (RTC) of Malolos, Bulacan, seeking to enforce their Contract to Sell dated 18 February 1987. In their Complaint docketed as Civil Case No. 215-M-90,7 Mario and Guillermo asserted that they have a better right over the subject property and alleged that the subsequent sale thereof effected by Reynaldo to third persons is void as it was done in bad faith. It was prayed in the Complaint that Reynaldo be directed to deliver the SPA and, in case of its impossibility, to return the amount of P31,500.00 with legal interest and with damages in either case.
To protect their rights on the subject property, Mario and Guillermo, after initiating Civil Case No. 215-M-90, filed a Notice of Lis Pendens registering their claim on the certificate of title covering the entire property.
In refuting the allegations of Mario and Guillermo in their Complaint. Reynaldo in his Answer8 countered that the purported Contract to Sell is void, because he never gave his consent thereto. Reynaldo insisted that he was made to understand that the contract between him and the Batongbacals was merely an equitable mortgage whereby it was agreed that the latter will loan to him the amount of P31,500.00 payable once he receives his share in the proceeds of the sale of the land registered under TCT No. T-1 07449.
Following the pre-trial conference without the parties reaching an amicable settlement, trial on the merits ensued.9 Both parties proceeded to present, in open court, documentary and testimonial evidence to substantiate their claims.
WHEREFORE, premises considered[,] the instant complaint is hereby DISMISSED.
In the course of the trial, Guillermo died and he was substituted by his heirs as party to the case.
WHEREFORE, the decision dated March 24, 1999 is AFFIRMED with modification that appellee is ordered to return to appellants the amount of P31,500.00 plus 12% interest per annum from the date of decision of the trial court until full payment thereof.
To pay appellants P50,000.00 as compensatory damages; P50,000.00 as moral damages; and P30,000.00 as exemplary damages.
In seeking modification of the appellate court's decision, Mario and Guillermo pointed out that the title of the subject property has not yet been transferred to third persons, and thus, Reynaldo can still be compelled to execute a deed of conveyance over his undivided share of the entire property.
WHEREFORE, [Reynaldo's] Motion for Reconsideration is DENIED for lack of merit.
Upon the other hand, [Mario and Guillermo] Motion for Reconsideration is GRANTED. Accordingly, the decision dated December 7, 2006 is PARTIALLY RECONSIDERED ordering defendant-appellee Reynaldo dela Rosa or his successor-in-interest to execute the requisite Deed of Sale over his 1/4 undivided share in the subject property covered by TCT T-107449 and to accept the consideration of P156,000.00 within thirty (30) days from the finality of the decision.
Petitioners Heirs of Reynaldo are now before this Court via this instant Petition for Review on Certiorari praying that the Court of Appeals Decision and Resolution be reversed on the ground that it was rendered not in accordance with the applicable law and jurisprudence.
The various contentions revolve on the sole issue of whether the contract entered into by parties was a Contract to Sell or an equitable mortgage. The Court will not delve into questions which arc factual m nature, consistent with the rule that this Court is not a trier of facts.
In assailing the Court of Appeals' Decision and Resolution, petitioners are unflinching in their stand that the disputed contract purporting to be an absolute deed of sale was an equitable mortgage with the subject property as security for a loan obligation. To prove their point, petitioners asserted that the consideration in the amount of P187,500.00 for a property consisting of 15,001 square meters is grossly inadequate because the land valuation in Barrio Saog, Marilao, Bulacan, at the time the transaction was entered into by the parties in 1984, was already P80.00 to P110.00 per square meter. The gross inadequacy of the price, the Heirs of Reynaldo argued, is telling of the intention of the parties to mortgage and not to sell the property with the end view of affording the mortgagor an easy opportunity to redeem the property should his means permit him to do so.
In any other case where it may be fairly inferred that the real intention of the parties is that the transaction shall secure the payment of a debt or the performance of any other obligation.
A perusal of the contract denominated as Resibo reveals the utter frailty of petitioners' position because nothing therein suggests, even remotely, that the subject property was given to secure a monetary obligation. The terms of the contract set forth in no uncertain terms that the instrument was executed with the intention of transferring the ownership or the subject property to the buyer in exchange for the price. Nowhere in the deed is it indicated that the transfer was merely intended to secure a debt obligation. On the contrary, the document clearly indicates the intent of Reynaldo to sell his share in the property. The primary consideration in determining the true nature of a contract is the intention of the parties.19 If the words of a contract appear to contravene the evident intention of the parties, the latter shall prevail.20 Such intention is determined not only from the express terms of their agreement, but also from the contemporaneous and subsequent acts of the parties.21 That the parties intended some other acts or contracts apart from the express terms of the agreement, was not proven by Reynaldo during the trial or by his heirs herein.22 Beyond their bare and uncorroborated asseverations that the contract failed to express the true intention of the parties, the record is bereft of any evidence indicative that there was an equitable mortgage.
Art. 493. Each co-owner shall have the full ownership of his part and or the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its enjoyment, except when personal rights arc involved. But the effect of the alienation or the mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted to him m the division upon the termination of the co-ownership.
LORETO sold the subject property to GABINO, JR. on May 12, 1986 as a co-owner. LORETO had a right, even before the partition of the property on January 19, 1987, to transfer in whole or in part his undivided interest in the lot even without the consent of his co-heirs. This right is absolute in accordance with the well-settled doctrine that a co-owner has full ownership of his pro-indiviso share and has the right to alienate, assign or mortgage it, and substitute another person for its enjoyment. Thus, what GABINO, JR. obtained by virtue of the sale on May 12, 1986 were the same rights as the vendor LORETO had as co-owner, in an ideal share equivalent to the consideration given under their transaction.
LORETO sold some 1,604 square meters of Lot No. 1253 to GABINO, JR. Consequently, when LORETO purportedly sold to WILFREDO on December 7, 1989 the same portion of the lot, he was no longer the owner of Lot No. 1253-B. Based on the principle that "no one can give what he does not have," LORETO could not have validly sold to WILFREDO on December 7, 1989 what he no longer had. As correctly pointed out by the appellate court, the sale made by LORETO in favor of WILFREDO is void as LORETO did not have the right to transfer the ownership of the subject property at the time of sale.26 (Emphasis supplied).
The ultimate authorities in civil law, recognized as such by the Court, agree that co-owners such as respondents have over their part, the right of full and absolute ownership. Such right is the same as that or individual owners which is not diminished by the fact that the entire property is co-owned with others. That part which ideally belongs to them, or their mental portion, may be disposed of as they please, independent of the decision of their co-owners. So we rule in this case. The respondents cannot be ordered to sell their portion of the co-owned properties. In the language of Rodriguez v. Court of First Instance of Rizal, "each party is the sole judge of what is good for him."27 (Underscoring ours).
Indeed, the intention clearly written, settles the issue regarding the purchase price. A contract of sale is a consensual contract, which becomes valid and binding upon the meeting of minds of the parties on the price and the object of the sale.29 The mere inadequacy of the price docs not affect its validity when both parties arc in a position to form an independent judgment concerning the transaction, unless fraud, mistake or undue influence indicative of a defect in consent is present.30 A contract may consequently be annulled on the ground of vitiated consent and not due to the inadequacy of the price.31 In the case at bar, however, no evidence to prove fraud, mistake or undue influence indicative of vitiated consent is attendant.
As the parties invoking equitable mortgage, the Heirs of Reynaldo did not even come close to proving that the parties intended to charge the property as security for a debt, leaving us with no other choice but to uphold the stipulations in the contract. Basic is the rule that if the terms of the contract are clear and leave no doubt upon the intention of the parties, the literal meaning of its stipulations shall control,32 we find that the Court of Appeals cannot be faulted for ruling, in modification of its original judgment, that the sale effected by Reynaldo of his undivided share in the property is valid and enforceable.
WHEREFORE, premises considered, the petition is DENIED. The assailed Decision and Resolution of the Court of Appeals are hereby AFFIRMED.
Carpio, (Chairperson), Brion, Del Castil, Perez, and Perlas-Bernabe, JJ., concur.
2 Penned by Associate Justice Lucenito N. Tagle with Associate Justices Robct1o A. Barrios and Mario L Guariña II I, concurring. Rollo, pp. 36-46.
3 Penned by Associate Justice Lucenito N. Tagle with by Associate Justices Roberto A. Barrios and Romeo F. Barza. concurring. I d. at 48-50.
4 Folder of Exhibits, pp. 52-53.
16 CA rollo, pp. 159.-161.
18Spouses Alvaro v. Spouses Ternida, 515 Phil. 267, 271-272 (2006).
19Heirs of Policronio M. Ureta. Sr. v. Heirs of Liberato M. Ureta, G.R. No. 165748, 14 September 2011, 657 SCRA 555, 576.
23Mercado v. Court of Appeals, G.R. No. 108592, 26 January 1995, 240 SCRA 616, 620-621.
24Vaglidad v. Vaglidad, Jr., 537 Phil. 310, 327 (2006).
25Acebedo v. Abesamis, G.R. No. 102380, 18 January 1993,217 SCRA 186, 194-195.
26 Supra note 24 at 327.
27 G.R. No. 189420,26 March 2014.
28 Folder of Exhibits, pp. 52-53.
29Bravo-Guerrero v. Bravo, 503 Phil. 220, 235 (2005).
30Bautista v. Court of Appeals, 479 Phil. 787, 795 (2004).
32 New Civil Code, Art. 1370.

References: v. 
 v. 

Art. 493
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 Art. 1370