THE ESTATE OF PEDRO C. GONZALES and HEIRS OF PEDRO C.
GONZALES, Petitioners, vs. THE HEIRS OF MARCOS PEREZ, Respondents. G.R. No.
169681, November 5, 2009.
“On the question of whether the subject Deed of Sale is
invalid on the ground that it does not appear in a public document, Article
1358 of the same Code enumerates the acts and contracts that should be embodied
in a public document, to wit:
Art. 1358. The following must appear in a public document:
(1) Acts and contracts which have for their object the
creation, transmission, modification or extinguishment of real rights over
immovable property; sales of real property or of an interest therein are
governed by Articles 1403, No. 2 and 1405;
(2) The cession, repudiation or renunciation of hereditary
rights or of those of the conjugal partnership of gains;
(3) The power to administer property, or any other power
which has for its object an act appearing or which should appear in a public
document, or should prejudice a third person; and
(4) The cession of actions or rights proceeding from an act
appearing in a public document.
All other contracts where the amount involved exceeds five
hundred pesos must appear in writing, even a private one. But sales of goods,
chattels or things in action are governed by Articles 1403, No. 2 and 1405.
On the other hand, pertinent portions of Article 1403 of the
Civil Code provide as follows:
Art. 1403. The following contracts are unenforceable, unless
they are ratified:
x x x x
(2) Those that do not comply with the Statute of Frauds as
set forth in this number. In the following cases an agreement hereafter made
shall be unenforceable by action, unless the same, or some note or memorandum
thereof, be in writing, and subscribed by the party charged, or by his agent;
evidence, therefore, of the agreement cannot be received without the writing,
or a secondary evidence of its contents:
(a) An agreement that by its terms is not to be performed
within a year from the making thereof;
x x x x
(e) An agreement for the leasing for a longer period than one
year, or for the sale of real property or of an interest therein; x x x27
Under Article 1403(2), the sale of real property should be in
writing and subscribed by the party charged for it to be enforceable.28 In the
case before the Court, the Deed of Sale between Pedro and Marcos is in writing
and subscribed by Pedro and his wife Francisca; hence, it is enforceable under
the Statute of Frauds.
However, not having been subscribed and sworn to before a
notary public, the Deed of Sale is not a public document and, therefore, does
not comply with Article 1358 of the Civil Code.
Nonetheless, it is a settled rule that the failure to observe
the proper form prescribed by Article 1358 does not render the acts or
contracts enumerated therein invalid. It has been uniformly held that the form
required under the said Article is not essential to the validity or
enforceability of the transaction, but merely for convenience.29 The Court
agrees with the CA in holding that a sale of real property, though not
consigned in a public instrument or formal writing, is, nevertheless, valid and
binding among the parties, for the time-honored rule is that even a verbal
contract of sale of real estate produces legal effects between the parties.30
Stated differently, although a conveyance of land is not made in a public
document, it does not affect the validity of such conveyance. Article 1358 does
not require the accomplishment of the acts or contracts in a public instrument
in order to validate the act or contract but only to insure its efficacy.31
Thus, based on the foregoing, the Court finds that the CA did not err in ruling
that the contract of sale between Pedro and Marcos is valid and binding.”
