G.R. No. 119255; April 9, 2003
Tomas K. Chua, petitioner, vs. Court of Appeals and Encarnacion Valdes-Choy, respondents.

FACTS

Petitioner Tomas K. Chua and respondent Encarnacion Valdes-Choy entered into a contract for the sale of Valdes-Choy’s paraphernal house and lot in Makati for P10.8 million. Chua paid P100,000.00 as earnest money, with the balance due on or before July 15, 1989. On July 13, 1989, the parties executed two Deeds of Absolute Sale. The following day, Chua advanced P485,000.00 to Valdes-Choy to pay the capital gains tax. When Chua presented a manager’s check for the P10,215,000.00 balance, he refused to deliver it unless the property was first registered in his name. Valdes-Choy refused this condition, tore the deeds, and the sale was not consummated.
Chua filed a complaint for specific performance. The Regional Trial Court ruled in his favor, ordering Valdes-Choy to execute the sale upon Chua’s consignation of the balance. The Court of Appeals reversed this decision, holding that Chua was not entitled to specific performance. Chua elevated the case to the Supreme Court via a petition for review on certiorari.

ISSUE

Whether petitioner Chua is entitled to the remedy of specific performance to compel the sale of the property.

RULING

No. The Supreme Court denied the petition and affirmed the Court of Appeals’ decision. The legal logic is anchored on the principle that specific performance is an equitable remedy not available to a party who has not performed his own obligations under the contract. The Court found that Chua failed to pay the full purchase price by the stipulated deadline of July 15, 1989. His act of conditioning the delivery of the balance check upon the prior transfer of the title was a unilateral imposition not agreed upon, constituting a failure to comply with his essential obligation as buyer.
Furthermore, the Court emphasized that Valdes-Choy was not in delay or in breach of contract. She was ready, willing, and able to perform her obligation to transfer title upon full payment. It was Chua who breached the contract by his failure to pay. A party who breaches a contract cannot demand specific performance from the other. The law does not compel a seller to transfer ownership without receiving the agreed price, as this would violate the reciprocal nature of a contract of sale. Since Chua was at fault, the equitable remedy of specific performance was properly denied. The Court also noted that Valdes-Choy’s act of tearing the deeds was a mere manifestation of her objection to Chua’s new demand and did not constitute a waiver or abandonment of her rights under the original agreement.