GR 161524; (January, 2006) (Digest)
G.R. No. 161524 ; January 27, 2006
LAURA M. MARNELEGO, Petitioner, vs. BANCO FILIPINO SAVINGS AND MORTGAGE BANK, Respondent.
FACTS
Petitioner Laura Marnelego entered into a Deed of Conditional Sale over a property mortgaged to respondent Banco Filipino. After the parties defaulted on amortizations, the bank foreclosed, acquired the property at auction, and obtained a writ of possession. In June 1984, Marnelego offered to repurchase the property for P310,000. Banco Filipino responded in September 1984, approving a repurchase at P362,000 under specific terms: a P310,000 cash down payment and a P52,000 balance payable within one year at 35% interest. Marnelego replied in October 1984 with a counter-proposal: a P100,000 down payment with the balance payable in five equal annual installments.
Following the bank’s closure and liquidation in 1985, Marnelego, allowed to remain on the property, sent a new proposal to the Deputy Liquidator in December 1985. This proposal stated the purchase price would be determined by the Liquidator, with a P120,000 deposit and the balance payable after a Supreme Court restraining order was lifted. The Liquidator rejected this in April 1986, demanding full payment of the bank’s asking price. Marnelego filed a complaint for specific performance.
ISSUE
Whether a perfected contract of sale existed between the parties, obligating Banco Filipino to convey the property to Marnelego.
RULING
No. The Supreme Court denied the petition, affirming the Court of Appeals’ reversal of the trial court. 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 exchange of correspondence reveals no such meeting of the minds on the essential element of price. Marnelego’s initial offer of P310,000 was met by the bank’s counter-offer of P362,000 under specific terms. Marnelego’s October 1984 reply did not accept these terms but instead proposed a different payment scheme (P100,000 down, five-year installments), constituting a rejection and a new counter-offer. No acceptance of this new counter-offer by the bank was shown.
Critically, Marnelego’s own December 1985 letter to the Liquidator proposed that the purchase price be “determined by the Liquidator,” demonstrating her acknowledgment that no price had been agreed upon. This was a fresh proposal, not an affirmation of a prior agreement. The subsequent rejection by the Liquidator solidified the absence of consent. Since the parties never agreed on the purchase price, an essential element of a contract of sale was lacking. Therefore, Marnelego’s action for specific performance correctly failed.