G.R. No. 114870 . May 26, 1995.
MIGUELA R. VILLANUEVA, RICHARD R. VILLANUEVA, and MERCEDITA VILLANUEVA-TIRADOS, petitioners, vs. COURT OF APPEALS, CENTRAL BANK OF THE PHILIPPINES, ILDEFONSO C. ONG, and PHILIPPINE VETERANS BANK, respondents.

FACTS

The disputed lots were originally owned by petitioner Miguela Villanueva. Through fraud perpetrated by a bank officer, the titles were transferred and the lots were eventually foreclosed in favor of the Philippine Veterans Bank (PVB). Miguela sought to repurchase the properties from PVB, beginning with an offer in June 1983. Meanwhile, in October 1984, private respondent Ildefonso Ong also offered to purchase the same lots. The PVB Board approved Ong’s offer via a November 1984 resolution, subject to payment of the balance within 15 days from receipt of the approval. Ong, who was abroad, did not immediately pay.
In April 1985, the PVB was placed under receivership and later under liquidation by the Central Bank. The liquidation court was established. In May 1987, Ong tendered payment of the balance, which was accepted by a PVB employee but made conditional upon the liquidator’s approval. The liquidator later disapproved the payment. Ong filed an action for specific performance, which was consolidated with the liquidation proceedings.

ISSUE

Do petitioners have a better right than private respondent Ildefonso Ong to purchase the subject lots from the Philippine Veterans Bank?

RULING

No. The Supreme Court ruled that petitioners do not have a better right. The Court reinstated the trial court’s decision, which had favored the petitioners, but on a different legal basis. The core legal logic centers on the effects of liquidation and the perfection of Ong’s contract. The Court found that no binding contract of sale was perfected between Ong and the PVB. The bank’s board resolution approving his offer was merely a counter-offer. A contract of sale is perfected only upon concurrence of offer and acceptance. Ong’s failure to pay the balance within the stipulated 15-day period from notice of approval meant he did not accept the counter-offer, leaving no perfected contract.
Crucially, when the PVB was placed under liquidation in 1985, its assets came under the custodia legis (in the custody of the law). From that point, the bank and its liquidator could no longer enter into any new contract of sale concerning its assets; disposition could only be made through public auction as ordered by the liquidation court. Ong’s tender of payment in 1987 was therefore legally ineffectual, as the bank/liquidator no longer had the capacity to accept it and perfect a sale. Consequently, Ong acquired no vested right to the lots. The petitioners’ claim, having been properly filed in the liquidation proceedings, could be considered by the liquidation court in accordance with the prescribed legal process for disposing of assets.