Vda. de Cruzo v. Carriaga
Lot No. 1131 is a paraphernal property of Gabina Machoca which was mortgaged to Franklin Ang. On October 4, 1954, Gabina borrowed an additional sum, and Ang, on the same day, caused the preparation of a deed of sale. Gabina being an illiterate affixed her thumb mark believing that it was just a deed of mortgage.
The following day, Gabina was informed by her children of the nature of the deed and thus, she went to Ang to ask for the reformation of the instrument. Instead of reforming the instrument, Ang prepared a deed of agreement stating that:
That I, FRANKLIN ANG, of legal age, married and with residence and postal address at Gango, City of Ozamiz, Philippines, VENDEE in the Deed of Sale executed by the Vendor, GAVINA MACHOCA, as recorded by Notary Public Manuel C. Manago in Doc. No. 284, Page No. 58, Book No. 1, Series of 1954, hereby grants and obligates himself (sic) to resell the property therein sold within a period of three (3) years from and after the date of the said instrument, for the same price of SIX HUNDRED PESOS ( P 600.00 ), Philippine Currency, to the said VENDOR: PROVIDED, however, That if the Vendor shall fail to exercise her right to redeem as herein granted within the stipulated period, then this conveyance shall be deemed to be absolute and irrevocable.
However, on June 10, 1955, Ang caused the registration of the deed of sale, resulting in the subsequent cancellation of Original Certificate of Title No. 682 and the consequent issuance of Transfer Certificate of Title No. T-161 for the same property in his name.
Since no redemption was made, Ang sold that lot to Suarez on June 24, 1963. In 1966, Gabina died leaving herein petitioners as her heirs.
Whether or not the deed of agreement constitutes a sale pacto de retro
No, there is no pacto de retro in this sale within the contemplation of the Civil Code which provides:
Art. 1601. Conventional redemption shall take place when the vendor reserves the right to repurchase the thing sold, with the obligation to comply with the provisions of Article 1616 and other stipulations which may been agreed upon.
Hence, the right of repurchase is not a right granted the vendor by the vendee in a subsequent instrument but is a right reserved by the vendor in the same instrument of sale as one of the stipulations of the contract.
Once the instrument of absolute sale is executed, the vendor can no longer reserve the right to repurchase, and any right thereafter granted the vendor by the vendee in a separate instrument cannot be a right of repurchase but some other right like the option to buy in the instant case.
The undertaking given to Gabina by Ang constitutes a mere promise to sell and not a right to purchase. Since it is just a mere promise to sell, Ang had to right to register the same and sell it to another person notwithstanding the unexpired stipulated period of “redemption” in the deed of agreement.