G.R. No. 136308 January 23, 2001
Elaine A. Del Rosario, petitioner, vs. Melinda F. Bonga, respondent.

FACTS

Respondent Melinda Bonga, as vendor, and petitioner Elaine Del Rosario, as vendee, entered into a Deed of Conditional Sale for a two-door apartment for P330,000.00. The contract stipulated a P130,000.00 down payment and a P200,000.00 balance payable within twelve months solely to Bonga. Del Rosario was allowed to occupy one unit rent-free until full payment. Bonga alleged that Del Rosario breached the contract by failing to pay the balance and by occupying and finishing a third, non-contracted apartment unit, renting out the unit she was supposed to occupy. Del Rosario defended that she made payments to Bonga’s husband, who claimed ownership. The pre-trial order limited the issues to Bonga’s right to rescind the contract and the damages due.
The Regional Trial Court rescinded the contract, ordered Del Rosario to vacate, and forfeited 50% of her payments. The Court of Appeals modified this, ordering Bonga to reimburse 50% of the payments with interest and Del Rosario to pay reasonable compensation for use of the third unit and attorney’s fees. Del Rosario appealed to the Supreme Court, raising for the first time the argument that the contract was void because the property was originally a homestead and its sale within the five-year prohibitory period violated the Public Land Act.

ISSUE

Whether the petitioner can raise for the first time on appeal the issue of the contract’s nullity due to an alleged violation of the Public Land Act.

RULING

No. The Supreme Court denied the petition, affirming the Court of Appeals with modification only on the interest rate. The Court held that issues and arguments not presented before the trial court cannot be raised for the first time on appeal. This rule is grounded in basic due process, as it prevents unfair surprise and allows the opposing party and the lower courts a proper opportunity to address and consider the contention. The sole issues framed during pre-trial were the right to rescind and damages. The petitioner actively participated in the trial, presenting evidence solely on these agreed issues without ever invoking the Public Land Act or the alleged homestead status of the property. Raising this new legal theory only at the appellate level is procedurally impermissible. The Court emphasized that its role is to review errors assigned and committed by the lower courts, not to entertain new matters. Consequently, the factual and legal bases for the rescission, as found by the lower courts, stand.