GR 138018; (July, 2002) (Digest)
G.R. No. 138018; July 26, 2002
RIDO MONTECILLO, petitioner, vs. IGNACIA REYNES and SPOUSES REDEMPTOR and ELISA ABUCAY, respondents.
FACTS
Respondent Ignacia Reynes, an illiterate widow, owned a 448-square meter lot in Cebu City. In 1981, she sold a 185-square meter portion to respondents Spouses Abucay. On March 1, 1984, Reynes affixed her thumbmark to a Deed of Absolute Sale covering the entire lot in favor of petitioner Rido Montecillo, a bank executive. The deed stated a purchase price of P47,000.00, which Montecillo promised to pay within one month. Reynes alleged Montecillo failed to pay after the period. She demanded the deed’s return and, upon his refusal, executed a document unilaterally revoking the sale. Subsequently, on May 23, 1984, Reynes sold the entire lot to the Abucay Spouses, confirming their prior partial purchase. Montecillo, however, caused the title to be transferred to his name. Reynes and the Abucay Spouses filed a complaint for declaration of nullity of Montecillo’s deed and quieting of title.
ISSUE
The core issue is whether the contract of sale between Reynes and Montecillo is valid and binding, given the alleged non-payment of the purchase price.
RULING
The Supreme Court affirmed the lower courts’ decisions declaring Montecillo’s deed of sale null and void ab initio. The legal logic hinges on the absence of a valid cause or consideration. A contract of sale is a consensual contract perfected by mere consent, but it is obligatory only if there is a cause or consideration. Here, the Court found that Montecillo failed to prove payment of the P47,000.00 purchase price, which was the cause of the obligation. His own admission that he still owed a balance of P10,000.00 contradicted his claim of full payment. His other alleged payments for a chattel mortgage release and taxes did not constitute payment of the purchase price to Reynes, as they were not made to her or for her benefit as the creditor-vendor. Without the agreed price being paid, the contract lacked an essential element—a lawful cause. Consequently, there was no meeting of the minds between the parties, rendering the sale void from the beginning. The subsequent sale to the Abucay Spouses, who were prior partial buyers and paid a valuable consideration, was upheld. The Court also noted that Montecillo, an educated man, took advantage of Reynes’s illiteracy, further vitiating her consent. The title issued in his name was therefore correctly ordered cancelled.