G.R. No. 119580 September 26, 1996
PHILIPPINE NATIONAL BANK, petitioner, vs. COURT OF APPEALS and LAPAZ KAW NGO, respondents.

FACTS

Private respondent Lapaz Kaw Ngo offered to purchase a parcel of land owned by petitioner Philippine National Bank (PNB). PNB approved the offer via a letter dated September 8, 1983, stipulating terms including a selling price and a condition that failure to pay an additional deposit would result in forfeiture of the initial deposit and authorization for PNB to sell to others. Ngo signified conformity on December 15, 1983. Subsequently, Ngo requested payment adjustments and a price reduction due to a decrease in land area. PNB agreed to a revised price on May 15, 1984.
Ngo failed to remit the required payments. PNB notified her of the cancellation of the sale and forfeiture of her deposit, later leasing the property to another party. Ngo then requested and received a refund of a portion of her deposit in October 1984. However, in 1986, following a letter from Ngo to the former President, PNB approved a revival of her offer under new terms. Ngo again failed to pay the stipulated additional deposit. PNB ultimately sold the property to a third party. Ngo filed an action for specific performance.

ISSUE

Whether a perfected contract of sale existed between PNB and Ngo.

RULING

No. The Supreme Court held that no perfected contract of sale was ever consummated. A contract of sale is perfected at the moment there is a meeting of the minds upon the thing which is the object of the contract and upon the price. The correspondence between the parties merely constituted a series of offers and counter-offers. PNB’s communications, including the 1983 letter and the 1986 revival, were clear offers subject to specific conditions, particularly the payment of a substantial deposit as a suspensive condition. Ngo’s failure to comply with these essential payment terms meant the offers never culminated in a binding agreement. Her subsequent acceptance of a partial refund in 1984 was a strong indication of abandonment and recognition that no final sale existed. The Court emphasized that a perfected contract requires absolute agreement on all material points; the parties here remained in the negotiation stage. The conditional nature of PNB’s approvals and Ngo’s repeated non-payment prevented the perfection of a contract. Thus, PNB was within its rights to sell the property to another party. The decision of the Court of Appeals was reversed.