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Villanueva vs.

PNB
G.R. No. 154493, December 6,
2006
FACTS:
The Special Assets Management Department (SAMD)
of the Philippine National Bank (PNB) issued an
advertisement for the sale of certain PNB properties in
Calumpang, General Santos City, including Lots 17
and 19 with advertised floor prices of P1,409,000.00
and P2,268,000.00 respectively.
Villanueva offered to purchase the lots for
P3,677,000.00. He also manifested that he was
depositing P400,000.00 to show his good faith but
with the understanding that said amount may be
treated as part of the payment of the purchase price
only when his offer is accepted by PNB.
At the bottom of said letter there appears an unsigned
marginal note stating that P400,000.00 was deposited
into Villanueva's account with PNB-General Santos
Branch.
PNB forwarded the letter of Villanueva to
Ramon Guevara, Vice President, SAMD.
Guevara informed Villanueva that only Lot No.
19 is available and that the asking price
therefor is P2,883,300.00. Guevara further
wrote:
If our quoted price is acceptable to
you, please submit a revised offer to
purchase. Sale shall be subject to our
Board of Director's approval and to
other terms and conditions imposed
by the Bank on sale of acquired
assets.
Instead of submitting a revised offer, Villanueva
merely inserted at the bottom of Guevara's letter a
marginal note, which reads:
CONFORME:
PRICE OF P2,883,300.00 (downpayment of
P600,000.00 and the balance payable in two
(2) years at quarterly amortizations.)
Villanueva paid P200,000.00 to PNB which the latter
issued a receipt to acknowledge receipt of the "partial
payment deposit on offer to purchase." On the dorsal
portion of Official Receipt No. 16997, Villanueva
signed a typewritten note, stating:
This is a deposit made to show the sincerity of my
purchase offer with the understanding that it shall
be returned without interest if my offer is not
favorably considered or be forfeited if my offer is
approved but I fail/refuse to push through the
purchase.
Thereafter, however, Guevara wrote Villanueva that
SAMD is deferring negotiations with him over said
property and returning his deposit of P580,000.00.
Undaunted, Villanueva attempted to deliver postdated
checks covering the balance of the purchase price but
PNB refused the same.
Thus Villanueva filed a Complaint for specific
performance which the RTC granted anchoring its

judgment on the finding that there existed a perfected


contract of sae between PNB and Villanueva.
PNB appealed to the CA which reversed and set aside
the decision, stating that in the case at bench,
consent, in respect to the price and manner of its
payment, is lacking. The record shows that appellant,
thru Guevara's July 6, 1990 letter, made a qualified
acceptance of appellee's letter-offer dated June 28,
1990 by imposing an asking price of P2,883,300.00 in
cash for Lot 19. The letter dated July 6, 1990
constituted a counter-offer (Art. 1319, Civil Code), to
which appellee made a new proposal, i.e., to pay the
amount of P2,883,300.00 in staggered amounts, that
is, P600,000.00 as downpayment and the balance
within two years in quarterly amortizations.
CA held that a qualified acceptance, or one that
involves a new proposal, constitutes a counter-offer
and a rejection of the original offer (Art. 1319).
Consequently, when something is desired which is not
exactly what is proposed in the offer, such acceptance
is not sufficient to generate consent because any
modification or variation from the terms of the offer
annuls the offer.
ISSUE: W/N there was a perfected Contract of
Sale between respondents PNB and herein
petitioner Villanueva. NO
HELD:
Contracts of sale are perfected by mutual consent
whereby the seller obligates himself, for a price
certain, to deliver and transfer ownership of a
specified thing or right to the buyer over which the
latter agrees. Mutual consent being a state of mind,
its existence may only be inferred from the confluence
of two acts of the parties: an offer certain as to the
object of the contract and its consideration, and an
acceptance of the offer which is absolute in that it
refers to the exact object and consideration embodied
in said offer. While it is impossible to expect the
acceptance to echo every nuance of the offer, it is
imperative that it assents to those points in the offer
which, under the operative facts of each contract, are
not only material but motivating as well. Anything
short of that level of mutuality produces not a
contract
but
a
mere
counter-offer
awaiting
acceptance. More particularly on the matter of the
consideration of the contract, the offer and its
acceptance must be unanimous both on the rate of
the payment and on its term. An acceptance of an
offer which agrees to the rate but varies the term is
ineffective.
Tracing the transactions and letters between
Villanueva and PNB, it can be said that there was no
perfected contract of sale between the parties. The
first letter of PNB stating that only Lot 19 was
available was certainly not an acceptance but a mere
counter-offer. Further, such counter-offer imposed two
more conditions that Villanueva submit a revised offer
to purchase based on the new price and that such sae
of property be approved by the Board of Directors.
However, Villanuevas reply to said counter-offer was
not an acceptance but a further counter-offer since he
qualified his acceptance proposing a two-year
payment

Moreover, Villanuevas contention that the repudiation


was belated since PNB already agreed to his counteroffer when it accepted his downpayment, the Court
ruled that acceptance of Villanuevas payments did
not amount to an implied acceptance of his last
counter-offer. PNB-GenSan Branch had no authority to
bind PNB to a contract of Sale with Villanueva. Neither
did SAMD have authority to bind PNB. Both clearly
stated that whatever is offered will be subject to
approval of PNBs higher authorities.
In sum, the amounts paid by petitioner were not in the
nature of downpayment or earnest money but were
mere deposits or proof of his interest in the purchase
of Lot No. 19. Acceptance of said amounts by
respondent does not presuppose perfection of any
contract.

Cortes vs CA
G.R. No. 126083, July 12, 2006
Facts:
For the purchase price of 3.7M, Villa Esperanza
Development Corporation and Antonio Cortes entered
into a contract of sale over the lots located at
Baclaran, Paraaque, Metro Manila. The Corporation
advanced to Cortes the total sum of P1,213,000.00.
Later, in September 1983, the parties executed a
deed of absolute sale on the following terms:
The Corporation shall advance 2.2 M as
downpayment, and Cortes shall likewise
deliver
the
TCT
for
the
3
lots.
The balance of 1.5M shall be payable within a
year from the date of the execution.
The Corporation filed the instant case for specific
performance seeking to compel Cortes to deliver the
TCTs and the original copy of the Deed of Absolute
Sale. According to the Corporation, despite its
readiness and ability to pay the purchase price, Cortes
refused delivery of the sought documents. Cortes
claimed that the owners duplicate copy of the three
TCTs were surrendered to the Corporation and it is the
latter which refused to pay in full the agreed down
payment.
RTC rendered a decision rescinding the sale and
directed Cortes to return to the Corporation the
amount of P1,213,000.00, plus interest. CA reversed
the decision and directed Cortes to execute a Deed of
Absolute Sale conveying the properties and to deliver
the same to the Corporation together with the TCTs,
simultaneous with the Corporations payment of the
balance of the purchase price of P2,487,000.00.
Issue: W/N there is delay in the performance of
the parties obligations that would justify the
rescission of the contract of sale.

Held:
There is no doubt that the contract of sale in question
gave rise to a reciprocal obligation of the parties.
Reciprocal obligations are those which arise from the
same cause, and which each party is a debtor and a
creditor of the other, such that the obligation of one is
dependent upon the obligation of the other. They are
to be performed simultaneously, so that the
performance of one is conditioned upon the
simultaneous fulfillment of the other.
In the present case, the Deed of Sale contained a
stipulation that the Corporation shall pay in full the
downpayment upon execution of the contract.
However, based on Cortes admission, he agreed that
the Corporations full payment of the downpayment
would depend upon the delivery of the TCTs of the
three subject lots. As such, the corresponding
reciprocal obligation of the Corporations payment
was the transfer of titles by Cortes. His obligation is
not only to affix the signature in the Deed, but to set
into motion the process that would facilitate transfer
of title of the lots.
As correctly found by the CA, Cortes never
surrendered said documents to the Corporation.
Cortes avers that he delivered the TCTs through the
brokers son. He further avers that the brokers son
delivered it to the broker, who in turn delivered them
to the Corporation. However, Marcosa Sanchezs
unrebutted testimony is that, she did not receive the
TCTs. She also denied knowledge of delivery thereof to
her son, Manny.
What further strengthened the findings of the Court of
Appeals that Cortes did not surrender the subject
documents was the offer of Cortes counsel at the pretrial to deliver the TCTs and the Deed of Absolute Sale
if the Corporation will pay the balance of the down
payment. Indeed, if the said documents were already
in the hands of the Corporation, there was no need for
Cortes counsel to make such offer.
Considering that their obligation was reciprocal,
performance thereof must be simultaneous. The
mutual inaction of Cortes and the Corporation
therefore gave rise to a compensation morae or
default on the part of both parties because neither
has completed their part in their reciprocal obligation.
Cortes is yet to deliver the original copy of the
notarized Deed and the TCTs, while the Corporation is
yet to pay in full the agreed down payment of
P2,200,000.00. This mutual delay of the parties
cancels out the effects of default, such that it is as if
no one is guilty of delay.
Additionally, under Article 1169 of the Civil Code, from
the moment one of the parties fulfills his obligation,
delay by the other begins. Since Cortes did not
perform his part, the provision of the contract
requiring the Corporation to pay in full the down
payment never acquired obligatory force.

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