G.R. No. 149322 November 28, 2008
JAIME L. YANEZA, petitioner, vs. THE HONORABLE COURT OF APPEALS, MANUEL A. DE JESUS and WILHELMINA M. MANZANO, respondents.

FACTS

Petitioner Jaime L. Yaneza owned a parcel of land (Lot 2730-A). Respondents Manuel A. de Jesus and Wilhelmina M. Manzano owned the adjacent lot (Lot 2732) which had no access to the nearest road except through a road they constructed over a portion of Lot 2730-A. After initial negotiations, the parties executed a Deed of Absolute Sale on October 20, 1995, covering a 175-sq m portion of Lot 2730-A for P20,000.00, to be used as a 5-meter wide access road. The deed included a condition that the vendor (Yaneza) would also have the perpetual right to use the same as a right of way. Almost a year later, Yaneza executed a Deed of Cancellation of the sale. When respondents refused to honor the cancellation, Yaneza filed a Complaint for Cancellation of Contract with the MCTC, alleging respondents constructed an 8-meter wide road (280 sq m), violated conditions, and dumped materials on the road. Respondents, in their Answer, claimed they had purchased the 280-sq m portion from the previous owner earlier, and that after discovering the deed only covered 175 sq m, they renegotiated and paid an additional P40,000.00 for the full 280 sq m, but Yaneza failed to prepare a new deed. They also alleged Yaneza constructed a fence obstructing the road after a dispute. The MCTC dismissed Yaneza’s complaint and granted respondents’ counterclaims, ordering Yaneza to execute a new deed for 280 sq m, remove the fence, and pay damages. The RTC affirmed the MCTC decision with modifications. Yaneza filed a petition for review with the Court of Appeals, which denied his Motion for Extension of Time to File Petition for Review, ruling it was filed after the lapse of the reglementary period.

ISSUE

The primary issue before the Supreme Court was whether the Court of Appeals committed grave abuse of discretion in denying petitioner’s Motion for Extension of Time to File Petition for Review on the ground of late filing. The underlying substantive issues involved the validity of the unilateral cancellation of the Deed of Absolute Sale and the nature of the parties’ agreement.

RULING

The Supreme Court DISMISSED the petition and AFFIRMED the assailed CA Resolutions. The Court held that the denial of the motion for extension was proper as it was filed beyond the reglementary period. On the substantive merits, the Court ruled that the contract between the parties was one of sale, not merely an easement, and was already perfected and partially executed upon delivery of the property and payment. The petitioner could not unilaterally rescind the contract; rescission must be judicially sought. The Court found no basis for rescission under Article 1191 of the Civil Code as there was no substantial breach by the respondents. The respondents’ failure to formally subdivide the lot and secure a separate title was not a breach that would warrant rescission but merely gave the petitioner a right to compel them to fulfill that obligation. The Deed of Absolute Sale was a valid contract binding on the parties.