Wednesday, August 12, 2015

Sale; Non-payment of consideration or purchase price; effect of; remedy.


“x x x.

Payment of consideration or purchase price

The petitioner’s allegation of non-payment is of no consequence taking into account the Municipal Voucher presented before the RTC, which proves payment by the respondent of Three Thousand Pesos (P3,000.00). The petitioner, notwithstanding the lack of the Municipal Treasurer’s approval, admitted that the signature appearing on the Municipal Voucher was his and he is now estopped from disclaiming payment.

Even assuming, arguendo, that the petitioner was not paid, such non payment is immaterial and has no effect on the validity of the contract of sale. A contract of sale is a consensual contract and what is required is the meeting of the minds on the object and the price for its perfection and validity.⁠9 In this case, the contract was perfected the moment the petitioner and the respondent agreed on the object of the sale – the two-hectare parcel of land, and the price – Three Thousand Pesos (P3,000.00). Non-payment of the purchase price merely gave rise to a right in favor of the petitioner to either demand specific performance or rescission of the contract of sale.⁠10

Sections 145 and 146 of the Administrative Code of Mindanao and Sulu, and Section 120 of the PLA, as amended, are not applicable

The petitioner relies on the foregoing laws in assailing the validity of the Deed of Sale, claiming that the contract lacks executive approval and that he is an illiterate non-Christian to whom the benefits of Sections 145 and 146 of the Administrative Code of Mindanao and Sulu should apply.

Section 145 of the Administrative Code of Mindanao and Sulu essentially provides for the requisites of the contracts entered into by a person with any Moro or other non-Christian inhabitants.⁠11 Section 146,⁠12 meanwhile, provides that contracts entered into in violation of Section 145 are void. These provisions aim to safeguard the patrimony of the less developed ethnic groups in the Philippines by shielding them against imposition and fraud when they enter into agreements dealing with realty.⁠13

Section 120 of the PLA (Commonwealth Act No. 141) affords the same protection.⁠14 R.A. No. No. 3872⁠15 likewise provides that conveyances and encumbrances made by illiterate non-Christian or literate non-Christians where the instrument of conveyance or encumbrance is in a language not understood by said literate non-Christians shall not be valid unless duly approved by the Chairman of the Commission on National Integration.

In Jandoc-Gatdula v. Dimalanta,⁠16 however, the Court categorically stated that while the purpose of Sections 145 and 146 of the Administrative Code of Mindanao and Sulu in requiring executive approval of contracts entered into by cultural minorities is indeed to protect them, the Court cannot blindly apply that law without considering how the parties exercised their rights and obligations. In this case, Municipality Resolution No. 70, which approved the appropriation of P3,000.00, was, in fact, accepted by the Provincial Board of Cotabato. In approving the appropriation of P3,000.00, the Municipal Council of Isulan and the Provincial Board of Cotabato, necessarily, scrutinized the Deed of Sale containing the terms and conditions of the sale. Moreover, there is nothing on record that proves that the petitioner was duped into signing the contract, that he was taken advantage of by the respondent and that his rights were not protected.

The court’s duty to protect the native vendor, however, should not be carried out to such an extent as to deny justice to the vendee when truth and justice happen to be on the latter’s side. The law cannot be used to shield the enrichment of one at the expense of another. More important, the law will not be applied so stringently as to render ineffective a contract that is otherwise valid, except for want of approval by the CNI. This principle holds, especially when the evils sought to be avoided are not obtaining.⁠17

The Court must also reject the petitioner’s claim that he did not understand the import of the agreement. He alleged that he signed in Arabic the Deed of Sale, the Joint Affidavit and the Municipal Voucher, which were all in English, and that he was not able to comprehend its contents. Records show the contrary. The petitioner, in fact, was able to execute in favor of Baikong a Special Power of Attorney (SPA) dated July 23, 1996, which was written in English albeit signed by the petitioner in Arabic. Said SPA authorized Baikong, the petitioner’s sister, to follow-up the payment of the purchase price. This raises doubt on the veracity of the petitioner’s allegation that he does not understand the language as he would not have been able to execute the SPA or he would have prevented its enforcement.

X x x.”