G.R. No. 27245, December 31, 1927
LEONA RAMOS, ET AL., plaintiffs-appellants, vs. FRANCISCO ICASIANO, ET AL., defendants-appellees.

FACTS

In 1889, Gregorio Ramos and Vicenta Fajardo sold a piece of land to spouses Pastor Villarica and Leonor Reyes with an indefinite right to repurchase. In 1903, Vicenta Fajardo, with the consent of the Villarica spouses, repurchased the land using money supplied by Francisco Icasiano. That same year, Fajardo sold the land to Francisco Icasiano, reserving a right to repurchase within a period of fourteen years. The formal document for this sale was executed after Fajardo’s death. Before her death, Fajardo executed a will on October 18, 1903, stating the terms of the sale to Icasiano, including the right to repurchase within ten years, extendable to fourteen years under certain conditions. After Fajardo’s death, disputes arose between her heirs and Icasiano. On August 5, 1905, Icasiano executed a document (Exhibit D) recognizing the heirs’ right to repurchase the land after fourteen years. Later, on August 19, 1918, Icasiano conveyed his rights to the land to Nieves Ramos and Ramon Meneses. The plaintiffs, as Fajardo’s heirs, filed an action to compel the defendants to sell the land to them, claiming their right to repurchase based on the subsequent agreement (Exhibit D).

ISSUE

Whether the plaintiffs, as heirs of Vicenta Fajardo, still have the right to repurchase the land from the defendants.

RULING

No. The Supreme Court affirmed the lower court’s judgment absolving the defendants from the complaint. The Court held that the transaction between Fajardo and Icasiano was a sale with a pacto de retro (right to repurchase) as defined in Article 1507 of the Civil Code. The subsequent agreement (Exhibit D) in 1905 did not create a new contract of promise to sell but merely modified the exercise of the pre-existing right of redemption by extending the period to fourteen years. Applying Article 1508 of the Civil Code, which limits the period for the exercise of the right of repurchase to ten years, the stipulation extending it to fourteen years was unlawful. Following the doctrine in *Santos vs. Heirs of Crisostomo and Tiongson* (41 Phil. 342), the Court ruled that while parties may suspend the exercise of the right of repurchase, they must still allow an appreciable time for its exercise within the ten-year statutory limit. Here, the attempt to totally suppress the right during the entire ten-year period and allow its exercise only after fourteen years was invalid. Consequently, the statutory ten-year period for redemption had already elapsed, barring the plaintiffs from exercising the right to repurchase. The judgment was affirmed with costs against the appellants.