GR 44142; (December, 1938) (Digest)
G.R. No. 44142 , December 24, 1938
VICENTE NOBLE, plaintiff-appellee, vs. CITY OF MANILA, defendant-appellant.
FACTS
The City of Manila entered into a contract with Jose Syquia for the construction of a school building on city-owned land. The contract, as amended, obligated the City to lease the building for a period renewable every three years and, crucially, to purchase the building for P46,600. The contract and the rights thereunder were eventually transferred to Vicente Noble. After occupying the building and paying rent, the City defaulted on rental payments starting February 1934. Noble filed an action to compel the City to purchase the building per the contract. The City, in its answer, sought to rescind the lease and instead expropriate the building.
ISSUE
Whether the City of Manila may expropriate the building instead of complying with its contractual obligation to purchase it.
RULING
No. The Supreme Court affirmed the lower court’s decision, ordering the City to purchase the building for the stipulated price. The Court held that the City’s obligation to purchase the building under the valid and subsisting contract remained in force. Expropriation is not justified where there is an existing agreement for sale at an agreed price, as its purpose is to address the owner’s opposition to the sale or lack of agreement on price. Here, expropriation would be an instrument to repudiate a legally binding obligation. The Court also found no merit in the City’s claim that the contract should be rescinded for being unfair, noting the delay in purchase was attributable to the City and the profit to Noble was not excessive.
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