G.R. No. L-11226, October 17, 1916
JOSE CASTILLO, plaintiff-appellant, vs. EULALIO BELISARIO, defendant-appellee.

FACTS:
On December 20, 1909, Eulalio Belisario sold two parcels of land to Jose Castillo for P550 under a pacto de retro (sale with right of repurchase). The contract (Exhibit A) stipulated that Belisario could repurchase the land within five months and twelve days (until May 31, 1910). Possession of the land was to remain with Belisario until the expiration of the redemption period. The period was later extended to September 1911. In September 1911, Belisario, being ill, sent his son and a relative of Castillo to tender the redemption price of P550 to Castillo, but Castillo refused to accept it. Subsequently, Castillo demanded much larger sums (P1,384.70 in 1912 and P3,000 in 1913) for the redemption. Castillo filed a complaint on November 12, 1914, seeking delivery of the land and damages, alleging that the redemption period had expired without repurchase.

ISSUE:
Whether the defendant-vendor, Eulalio Belisario, validly exercised his right of repurchase under the pacto de retro contract, thereby precluding the plaintiff-vendee, Jose Castillo, from consolidating ownership and obtaining possession of the land.

RULING:
The Supreme Court AFFIRMED the trial court’s judgment. The Court held that the contract was a valid pacto de retro sale. Belisario validly exercised his right of repurchase by tendering the full redemption price of P550 within the extended period agreed upon (September 1911). His act of sending the money through his son and a witness, despite his illness, constituted sufficient compliance with his obligation under Article 1518 of the Civil Code. Castillo’s unjustified refusal to accept the tender did not extinguish Belisario’s right. Consequently, Castillo had not consolidated ownership and was not entitled to recover possession of the land. The Court modified the judgment, ordering Belisario to pay Castillo P550 within ten days, with legal interest from November 12, 1914 (the date of judicial demand), after complying with the formalities of Article 1518. Costs were taxed against the appellant, Castillo.