GR 93176; (April, 1994) (Digest)
G.R. No. 93176 April 22, 1994
SISKA DEVELOPMENT CORPORATION, petitioner, vs. OFFICE OF THE PRESIDENT OF THE PHILIPPINES, and SPOUSES JOSE and SOCORRO SERING, respondents.
FACTS
On April 28, 1967, petitioner Siska Development Corporation, a subdivision owner-developer, entered into a Contract to Sell with Guadalupe Sering for a lot in Mira-Nila Subdivision, Quezon City. On August 16, 1968, Guadalupe Sering, with petitioner’s consent, transferred her rights to respondent Socorro Sering, wife of Jose Sering, who then assumed the obligation to pay the monthly amortizations. Private respondents defaulted on several occasions, but petitioner accepted their late payments. On October 18, 1974, petitioner sent a notice of rescission for failure to pay on time but cancelled it on November 12, 1974, after private respondents updated their payments, imposing a condition that the account “must be kept current” and that a second rescission would be final. Private respondents again defaulted from January to September 1, 1975. When Jose Sering offered to pay the remaining balance on September 18, 1975, petitioner’s employee refused, alleging the contract had been cancelled, but Jose Sering protested receiving no notice of rescission. Private respondents filed an action for specific performance, which was eventually dismissed on jurisdictional grounds, leading to a complaint filed with the National Housing Authority, later transferred to the Human Settlements Regulatory Commission (HSRC Case No. REM-A-0156). The HSRC denied specific performance and ordered a refund. On appeal, the Office of the President reversed the HSRC, directing petitioner to execute a final deed of sale upon payment of the unpaid balance of P9,341.24, and denied petitioner’s motion for reconsideration.
ISSUE
1. Whether the Office of the President committed grave abuse of discretion in finding the notice of rescission served no purpose as it was not received by private respondents.
2. Whether the Office of the President committed grave abuse of discretion in finding petitioner estopped from insisting on rescission due to its acceptance of delayed payments on several occasions.
3. Whether the Office of the President committed grave abuse of discretion in ordering petitioner to accept P9,341.24 as full payment and execute a final deed of sale.
RULING
The Supreme Court affirmed the Resolution and Order of the Office of the President.
1. On the first issue, the Court upheld the Office of the President’s factual finding that private respondents never received the notice of rescission, a finding not to be disturbed. The Court further ruled that even without the Maceda Law (R.A. 6552), which took effect after the contract was entered but before the rescission, jurisprudence requires a written notice of rescission to be sent to the defaulter to make the act of cancellation known. The requirement of notice under the Maceda Law does not impair the contract under the Constitution, as it merely provides a procedure in aid of rescission and does not change the terms or remedies.
2. On the second issue, the Court held that petitioner, by accepting delayed payments beyond the grace period on several instances, waived its right to rescind and is estopped from exercising it. The Contract to Sell was a contract of adhesion, drafted by petitioner and accepted by private respondents on a take-it-or-leave-it basis. Petitioner’s conduct in tolerating late payments precluded it from insisting on rescission for the last delayed payment.
3. On the third issue, the Court ruled that unilateral cancellation is not warranted for a slight or casual breach. The breach was slight as private respondents had already paid P26,601.21 (including interests and penalties) out of the total purchase price of P21,328.00, with only P9,341.24 remaining, which they were willing to pay. Allowing rescission would work injustice and unjustly enrich petitioner at the expense of private respondents.
The petition was dismissed. Petitioner was ordered to accept the balance of P9,341.24 and execute the final deed of sale in favor of private respondents. No costs.