GR 22202; (February 1976) (Digest)
G.R. No. L-22202. February 27, 1976.
PEDRO TAPAS and MARIA ORIÑA DE TAPAS, petitioners, vs. COURT OF APPEALS, ROBERTO DE JESUS and CEFERINA DE JESUS, respondents.
FACTS
Petitioners Pedro Tapas and Maria Oriña de Tapas filed an action in the lower court to reform certain contracts, claiming they were equitable mortgages, not absolute sales. The lower court ruled against them. On appeal, the Court of Appeals partially granted their plea, reforming two contracts into equitable mortgages. However, for a third parcel of land, the appellate court affirmed the lower court’s finding that the transaction was an absolute deed of sale. The deed was prepared by a notary public who testified it was explained to the parties as an absolute sale. Petitioner Maria Oriña de Tapas, though claiming limited schooling, was accompanied by her educated husband, a former seminarian, who signed the document. The purchase price was based on the assessed value and was not deemed grossly inadequate.
ISSUE
Whether the Court of Appeals erred in not applying Article 1606 of the Civil Code, which allows a vendor to exercise the right to repurchase within thirty days from a final judgment declaring a contract to be a true sale with a right to repurchase (pacto de retro), despite its finding that the contract was an absolute sale.
RULING
The Supreme Court denied the petition and affirmed the decision of the Court of Appeals. The legal logic is clear and twofold. First, the Court is bound by the factual findings of the Court of Appeals. Under settled jurisprudence, the Supreme Court’s jurisdiction in appeals from the Court of Appeals is limited to reviewing errors of law; factual findings are conclusive. The appellate court meticulously found that the deed was an absolute sale, noting the notary’s testimony, the presence and signature of the educated husband, the adequacy of the price, and the lessors’ possession being explained by a subsequent lease contract. These factual conclusions are binding.
Second, Article 1606 of the Civil Code is inapplicable. The provision explicitly states that the vendor may exercise the right to repurchase within thirty days from a final judgment rendered “on the basis that the contract was a true sale with right to repurchase.” This remedy only applies when the court itself finds or declares the contract to be a pacto de retro sale. Here, the final judgment of the Court of Appeals expressly found the contract to be an absolute deed of sale, not a sale with a right to repurchase. Therefore, the condition precedent for applying Article 1606—a judicial declaration of a pacto de retro—is absent. The law cannot be invoked to create a right of repurchase where the court has definitively ruled that no such right was intended by the parties under an absolute sale. The petition, having no legal basis, must fail.