Dignos v. Court of Appeals
In 1965, Petitioners executed a deed of sale of a lot to respondent Jabil. The deed indicated that the lot is payable on two installments and that the petitioners will only sign an absolute contract of sale once the installments were paid on time.
However, on the said deadline, the respondent Jabil failed to pay the amount. The next month, Petitioners sold the lot to another person. The respondent now contends that Petitioners cannot sell the lot to somebody else as there was already an absolute contract of sale and there was already delivery.
Petitioners, on the other hand, contend that their contract is a conditional contract of sale with the condition of full payment before the absolute sale can be made. Moreover, Petitioners aver that their act of selling the lot to another person is a sign of rescission.
1. Whether or not the contract is an absolute contract of sale
2. Whether or not there was a valid rescission of said contract
1. Yes. The deed of sale does not state anywhere that the title of the lot will remain at the vendor until all the installments are paid. It is well known that an instrument’s intent is much stronger than its name. In this case, all the elements of an absolute contract of sale are present.
In an absolute sale, the ownership is transferred upon delivery. There is evidence that the respondent is already residing on the property and that the petitioner has already left. Thus, Respondent Jabil is now the owner of the land.
2. No. There was no valid rescission as the facts show that the petitioners sold the lot to another without even giving a notarial act. Since the contract is an absolute sale, it is governed by Art. 1592 of the Civil Code of the Philippines.
Petitioners should have given a notarial act of rescission or filed a suit in court for such rescission. Thus, there could be no valid rescission.