Case Digest: Casa Filipina Development Corporation vs. The Deputy Secretary, et al

G.R. No. 96496

CASA FILIPINA DEVELOPMENT CORPORATION

VS. THE DEPUTY EXECUTIVE SECRETARY,  MAY 28, 1992

ACTION: PETITION OF REVIEW ON CERTIORARI (treated as petition for certiorari), seeking to reverse the Office of the President’s Decision

FACTS:

Jose Valenzuela Jr( Valenzuela for brevity) entered into a contract to sell with Casa Filipina Development (CFD for brevity). However, despite full payment by Valenzuela and his offer to pay the transfer expenses, CFD refused to execute the deed of absolute sale and deliver the property. So Valenzuela filed a complaint before the Office of Appeals (OAALA) of the Human Settlements Regulatory Commission (now HLURB). CFD on the other hand contends that Valnezuela’s action is premature since Valenzuela has yet to comply with the other conditional requierments of their contract: i.e. payment of certain fees and expenses.

OOALA ruled in favor of Valenzuela, ordering that CFD must execute the deed of absolute sale, bill Valenzuela of the transfer expenses, and deliver the property free from liens and encumbrances. In case CFD is unable to do so, CFD must refund Valenzuela P76,180.82 (80/100) plus 24% per annum until fully paid.

CFD appealed the decision and reasoned that due to succeeding events (CFD’s new mortgagee bank prohibits the release of individual title until CFD’s prior obligations be paid first) and the failure of the past administration to put up a viable and progressive economic program precludes CFD from making the transfer. This reason was not well-taken by HLURB since no proof was shown to substantiate CFD’s claim. HLURB emphasized the six  (6) month period from full payment within which the developer must deliver the property sold (PD 957,Sec 25). It is also within such time that redemption may be had. In the present case, it has been more than one (1) year already.

CFD appealed then again appealed the decision before the Office of the President.

ISSUES (as raised by CFD)

1.  Whether or not both remedies of specific performance and rescision may be availed of at the sme time.

2.  Whether or not Valenzuela showed proof of his intent to pay the expenses of the transfer of title.

3. Whether or not the 24% interest was with basis.

4. Whether ot not the 6-month period provided by PD 947 for the purpose of redemption had not began to run since the title had not yet been issued in view of the takeoverof the new mortgagee bank.

RULING:

1. Whether or not both remedies of specific performance and rescision may be availed of at the same time.

The decision of OOALA is clear. IT only ordered the rescission in the event specific performane is not feasible.

2. Whether or not Valenzuela showed proof of his intent to pay the expenses of the transfer of title.

The Court accorded respect to the finding of fact by the OAALA that “the complainant was ready, willing and able to pay for the expenses for the transfer of title as stipulated in the Contract to Sell.

3. Whether or not the 24% interest was with basis.

The interest rate of 24% was mutually agreed to by the parties, thus, it must be applied and not the legal rate of interest.

4. Whether ot not the 6-month period provided by PD 947 for the purpose of redemption had not began to run since the title had not yet been issued in view of the takeover of the new mortgagee bank.

The Court has the following to say: “The argument of petitioner that the issuance of the title is a prerequisite to the running of the six month period of redemption, fails to convince Us. Otherwise, the owner or developer can readily concoct a thousand and one reasons as justifications for its failure to issue the title and in the process, prolong the period within which to deliver the title to the buyer free from any liens or encumbrances. Additionally, by not issuing/delivering the title of the lot to private respondent upon full payment thereof, petitioner has already violated the explicit mandate of the first sentence of Section 25 of P.D. No. 957. If We were to count the six month period of redemption from the belated issuance of the title, petitioner will have a lot to gain from its own non-observance of said provision. We shall not countenance such absurdity.”

Categories: 96496, Casa Filipina Development vs. The Deputy executive secretary, Case Digest: Casa Filipina Development Corporation vs. The Deputy Secretary, et al, GR No 96496, Jose Valenzuela Jr., may 28 1992