GR 122463; (December, 2005) (Digest)
G.R. No. 122463. December 19, 2005.
RUDOLF LIETZ, INC., Petitioner, vs. THE COURT OF APPEALS, AGAPITO BURIOL, TIZIANA TURATELLO & PAOLA SANI, Respondents.
FACTS
Petitioner Rudolf Lietz, Inc. purchased a parcel of land from respondent Agapito Buriol, described in the Deed of Absolute Sale as containing five hectares. Subsequently, petitioner discovered that Buriol owned only four hectares and had previously leased one hectare to respondents Tiziana Turatello and Paola Sani. Petitioner filed a complaint for Annulment of Lease with Recovery of Possession and Damages, alleging bad faith on Buriol’s part for selling land he did not fully own.
The Regional Trial Court dismissed the complaint. On appeal, the Court of Appeals affirmed the dismissal but modified the judgment by awarding moral and exemplary damages, attorney’s fees, and litigation expenses to respondents Turatello and Sani. Petitioner elevated the case to the Supreme Court via a petition for review on certiorari.
ISSUE
The main issues are: (1) whether petitioner is entitled to a proportional reduction of the purchase price due to the deficiency in area, and (2) whether the awards of moral and exemplary damages to respondents Turatello and Sani are proper.
RULING
The Supreme Court partially granted the petition. On the first issue, the Court ruled that petitioner is not entitled to a price reduction under Article 1539 of the Civil Code. The provision applies only when the sale specifies a price per unit of measure. Here, the contract was for a lump sum price of ₱30,000 for the entire parcel, not at a rate per hectare. Therefore, the rule on proportional reduction for area deficiency does not apply. The sale is governed by Article 1542, which states that in a lump sum sale, the vendor is bound to deliver the specific property described, and the vendee accepts it as is, subject to the remedies for hidden encumbrances or eviction, which were not invoked.
On the second issue, the Court deleted the awards of moral and exemplary damages to Turatello and Sani. The filing of an unfounded civil action is not among the grounds for awarding moral damages under the Civil Code. Since the award of moral damages was baseless, the concomitant award of exemplary damages, which requires a valid award of moral, temperate, or compensatory damages as a basis, must likewise be deleted. The Court affirmed the dismissal of the complaint but removed the damages awarded by the Court of Appeals.