G.R. No. 204264 , June 29, 2016
JENNEFER FIGUERA, as substituted by ENHANCE VISA SERVICES, INC., represented by MA. EDEN R. DUMONT, Petitioner, vs. MARIA REMEDIOS ANG, Respondent.

FACTS

Maria Remedios Ang, owner of Enhance Immigration and Documentation Consultants (EIDC), executed a Deed of Assignment of Business Rights transferring all business rights to Jennefer Figuera for ₱150,000. The Deed stipulated that Ang would pay for December 2004 utility bills and employee salaries. Figuera, however, paid these bills herself without Ang’s consent, amounting to ₱107,903.21. Figuera then tendered only ₱42,096.79 to Ang, representing the balance after deducting her utility payments. Ang refused this partial payment, insisting on the full ₱150,000. Figuera filed a complaint for specific performance and consigned the reduced amount with the Regional Trial Court (RTC).
The RTC ruled in favor of Ang, holding that the Deed’s clear terms required her to pay the December bills and that Figuera’s unilateral payment did not alter the agreed consideration. The RTC found Figuera’s tender and consignation invalid for not being the full amount. The Court of Appeals affirmed, stating nothing in the Deed authorized Figuera to deduct her utility payments and that legal subrogation and compensation did not apply.

ISSUE

Whether the Court of Appeals erred in ruling that there was no valid tender of payment and consignation by Figuera.

RULING

The Supreme Court granted the petition and reversed the CA’s ruling. The Court held that the core issue was a question of law, reviewable under a Rule 45 petition, as it pertained to the correct application of legal principles—specifically consignation, legal subrogation, and compensation—to the undisputed facts.
The Court found that legal subrogation under Article 1302 of the Civil Code had occurred. By paying Ang’s creditors (the utility companies and employees) for the December 2004 obligations that Ang was contractually bound to settle, Figuera was subrogated to the rights of these creditors against Ang, even without Ang’s knowledge or consent. Consequently, Ang became indebted to Figuera for ₱107,903.21. This reciprocal obligation between the parties—Figuera’s debt of ₱150,000 to Ang and Ang’s new debt of ₱107,903.21 to Figuera—gave rise to legal compensation under Article 1279. Since both debts were liquidated (readily ascertainable) and demandable, they were extinguished by operation of law to the concurrent amount, leaving a net balance of ₱42,096.79 due from Figuera to Ang.
Therefore, Figuera’s tender and subsequent consignation of ₱42,096.79 were valid. Her obligation was only for this net amount after compensation. Ang’s unjustified refusal to accept this valid tender excused Figuera from further delay, making the consignation with the court fully effective to extinguish the obligation. The CA erred in insisting on tender of the gross ₱150,000 without considering the legal effects of subrogation and compensation.