Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&view=article&id=82773:56619&catid=1579&Itemid=566
Timestamp: 2019-04-19 22:53:53+00:00

Document:
G.R. No. 162365, January 15, 2014 - ROBERTO R. DAVID, Petitioner, v. EDUARDO C. DAVID, Respondent.
ROBERTO R. DAVID, Petitioner, v. EDUARDO C. DAVID, Respondent.
In a sale with right to repurchase, title and ownership of the property sold are immediately vested in the vendee, subject to the resolutory condition of repurchase by the vendor within the stipulated period.
Respondent Eduardo C. David (Eduardo) initiated this replevin suit against Roberto R. David (Roberto), his first cousin and former business partner, to recover the possession of one unit of International CO 9670 Truck Tractor and Mi-Bed Trailer.
It appears that on July 7, 1995, Eduardo and his brother Edwin C. David (Edwin), acting on their own and in behalf of their co-heirs, sold their inherited properties to Roberto, specifically: (a) a parcel of land with an area of 1,231 square meters, together with all the improvements existing thereon, located in Baguio City and covered by Transfer Certificate of Title No. T-22983 of the Registry of Deeds of Baguio City (Baguio City lot); and (b) two units International CO 9670 Truck Tractor with two Mi-Bed Trailers.3 A deed of sale with assumption of mortgage (deed of sale)4 embodied the terms of their agreement, stipulating that the consideration for the sale was P6,000,000.00, of which P2,000,000 was to be paid to Eduardo and Edwin, and the remaining P4,000,000.00 to be paid to Development Bank of the Philippines (DBP) in Baguio City to settle the outstanding obligation secured by a mortgage on such properties. The parties further agreed to give Eduardo and Edwin the right to repurchase the properties within a period of three years from the execution of the deed of sale based on the purchase price agreed upon, plus 12% interest per annum.
After the execution of the MOA, Roberto gave Eduardo P2,800,000.00 and returned to him one of the truck tractors and trailers subject of the deed of sale. Eduardo demanded for the return of the other truck tractor and trailer, but Roberto refused to heed the demand.
Thus, Eduardo initiated this replevin suit against Roberto, alleging that he was exercising the right to repurchase under the deed of sale; and that he was entitled to the possession of the other motor vehicle and trailer.
In his answer, Roberto denied that Eduardo could repurchase the properties in question; and insisted that the MOA had extinguished their deed of sale by novation.
WHEREFORE, premises considered, judgment is hereby rendered for the plaintiff and against the defendant ORDERING the latter to return to the former the motor vehicle and trailer subject matter of the case or to pay its value in the amount of P500,000 in case manual delivery can not be effected; to pay plaintiff the amount of P20,000 as litigation expenses; the amount of P50,000 as attorney’s fees and the costs of this suit.
Roberto appealed to the CA.
On October 10, 2003, 10 the CA promulgated its decision affirming the RTC. It opined that although there was no express exercise of the right to repurchase, the sum of all the relevant circumstances indicated that there was an exercise of the right to repurchase pursuant to the deed of sale, that the findings of the RTC to the effect that the conditions for the exercise of the right to repurchase had been adequately satisfied by Eduardo, and that no novation as claimed by Roberto had intervened.
A sale with right to repurchase is governed by Article 1601 of the Civil Code, which provides that: “Conventional redemption shall take place when the vendor reserves the right to repurchase the thing sold, with the obligation to comply with the provisions of Article 1616 and other stipulations which may have been agreed upon.” Conformably with Article 1616,14 the seller given the right to repurchase may exercise his right of redemption by paying the buyer: (a) the price of the sale, (b) the expenses of the contract, (c) legitimate payments made by reason of the sale, and (d) the necessary and useful expenses made on the thing sold.
It should be noted that the alleged repurchase was exercised within the stipulated period of three (3) years from the time the Deed of Sale with Assumption of Mortgage was executed. The only question now, therefore, which remains to be resolved is whether or not the conditions set forth in the Deed of Sale with Assumption of Mortgage, i.e. the tender of the purchase price previously agreed upon, which is Php2.0 Million, plus 12% interest per annum, and the amount paid by the defendant to DBP, had been satisfied.
Considering that the factual findings of the trial court, when affirmed by the CA, are binding on the Court,17 the Court affirms the judgment of the CA upholding Eduardo’s exercise of the right of repurchase. Roberto could no longer assail the factual findings because his petition for review on certiorari was limited to the review and determination of questions of law only. A question of law exists when the doubt centers on what the law is on a certain set of undisputed facts, while a question of fact exists when the doubt centers on the truth or falsity of the alleged facts.18 Whether the conditions for the right to repurchase were complied with, or whether there was a tender of payment, is a question of fact. With both the RTC and the CA finding and holding that Eduardo had fulfilled the conditions for the exercise of the right to repurchase, therefore, we conclude that Eduardo had effectively repurchased the properties subject of the deed of sale.
In Metropolitan Bank and Trust Company v. Tan,19 the Court ruled that a redemption within the period allowed by law is not a matter of intent but of payment or valid tender of the full redemption price within the period. Verily, the tender of payment is the seller’s manifestation of his desire to repurchase the property with the offer of immediate performance.20 As we stated in Legaspi v. Court of Appeals,21 a sincere tender of payment is sufficient to show the exercise of the right to repurchase. Here, Eduardo paid the repurchase price to Roberto by depositing the proceeds of the sale of the Baguio City lot in the latter’s account. Such payment was an effective exercise of the right to repurchase.
On the other hand, the Court dismisses as devoid of merit Roberto’s insistence that the MOA had extinguished the obligations established under the deed of sale by novation.
The issue of novation involves a question of fact, as it necessarily requires the factual determination of the existence of the various requisites of novation, namely: (a) there must be a previous valid obligation; (b) the parties concerned must agree to a new contract; (c) the old contract must be extinguished; and (d) there must be a valid new contract.22 With both the RTC and the CA concluding that the MOA was consistent with the deed of sale, novation whereby the deed of sale was extinguished did not occur. In that regard, it is worth repeating that the factual findings of the lower courts are binding on the Court.
In sales with the right to repurchase, the title and ownership of the property sold are immediately vested in the vendee, subject to the resolutory condition of repurchase by the vendor within the stipulated period.23 Accordingly, the ownership of the affected properties reverted to Eduardo once he complied with the condition for the repurchase, thereby entitling him to the possession of the other motor vehicle with trailer.
WHEREFORE, the Court AFFIRMS the decision promulgated on October 10, 2003; and ORDERS the petitioner to pay the costs of suit.
1Rollo, pp. 26-34; penned by Associate Justice Rodrigo V. Cosico (retired), with Associate Justice Mariano C. Del Castillo (now a Member of the Court) and Associate Justice Rosalinda Asuncion-Vicente (retired) concurring.
2 Id. at 55-59; penned by Judge Antonio C. Reyes.
7 Id. at 12; 79.
14 Article 1616. The vendor cannot avail himself of the right of repurchase without returning to the vendee the price of the sale, and in addition: (1) The expenses of the contract, and any other legitimate payments made by reason of the sale; (2) The necessary and useful expenses made on the thing sold.
17Narvaez v. Alciso, G.R. No. 165907, July 27, 2009, 594 SCRA 60, 70, citing Pagsibigan v. People, G.R. No. 163868, June 4, 2009, 588 SCRA 249, 257.
19 G. R. No. 178449, October 17, 2008, 569 SCRA 814, 832, citing BPI Family Savings Bank Inc. v. Veloso, G.R. No. 141974, August 9, 2004, 436 SCRA 1, 8.
20Narvaez v. Alciso, supra note 14, at 75.
21 G.R. No. L-45510, May 27, 1986, 142 SCRA 82, 88.
22Magdiwang Realty Corp. v. The Manila Banking Corp., G.R. No. 195592, September 5, 2012, 680 SCRA 251, 263, citing Country Bankers Insurance Corporation v. Lagman, G.R. No. 165487, July 13, 2011, 653 SCRA 765, 777.
23Lumayag v. Heirs of Jacinto Nemeño, G. R. No. 162112, July 3, 2007, 526 SCRA 315, 324, citing Vda. De Rigonan v. Derecho, G.R. No. 159571, July 15, 2005, 463 SCRA 627, 636.

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