#18 Robleza vs. CA & Inter-Island G.R. No. L-80364 Fats! Petitioner Julita A. Robleza sold to spouses Elpedio and Marianne Tan 2 parcels of land. They executed a deed of absolute sale in favor of the Tan spouses over the the lots lots supposed sedly for for Pl0 l0 !hi !hich !as !as acno!led"ed to have been alle"edly paid. #nci #ncid denta entall lly y$ the the pare parent nts s of Elped lpedio io Tan and and petitioners are close to each other. #t !as found that the titles over the 2 lots !ere "iven to Elpedio Tan !ho !as able to have t!o ne! titles in his na%e. &urther$ &urther$ Elpedio Tan Tan executed in favor of respondent respondent corporation a pro%issory note 'P() in the su% of P22*$+,2.-0 and executed a deed of %ort"a"e over the t!o lots to secure pay%ent of said P(. Petitioners$ Petitioners$ clai%in" that they did not receive a sin"le centa centavo vo fro% fro% the Tans ans and and %ainta %aintaini inin" n" that that the purchase price of Pl0 appearin" on the face of the deed deed of sale sale !as !as not not the the true true purc purcha hase se pric price$ e$ presented t!o checs issued by Elpedio Tan !hich represented the actual stipulated price the - chec a%ountin" to P/0 and the other P. 1oth !ere dishonored. dishonored. Thereafter$ Thereafter$ Elpedio Tan assured the% that he !ould pay the a%ount of the checs but failed to %ae "ood his pro%ise. Elpedio Tan ad%itted that he had transferred the titles to the lots in his na%e and that he had %ort"a"ed the lots lots and and turn turned ed over over his his cert certif ific icat ates es of titl title e to respondent corporation. Petitioner found out that the t!o lots !ere used as collaterals and that the certificates of title !ere in the possession of the private respondent. Apprised of the true facts on the status of the said t!o lots and the non nonpa pay% y%en entt of the the purc purcha hase se pric price e by the the Tan spou spouses ses$$ respo respond nden entt corp. corp. refus refused ed to return return the the certifica certificates tes of title but si"nifie si"nified d their their !illin"n !illin"ness ess to accept other collaterals provided a partial pay%ent of P/0 !ould first be %ade by Elpedio Tan. &or &or fail failur ure e of the the Tans ans to pay pay thei theirr outs outsta tand ndin in" " obli"ation obli"ation to private respondent$ respondent$ the %ort"a"e on the t!o lots !as foreclosed and the sa%e !ere sold to respondent corp. in a public auction sale. Title !as issued in its na%e. Petitioners filed an action for the nullification of the aforesaid deed of sale for !ant of consideration and for for the cance cancella llatio tion n of the the T3T issued issued to priva private te respondent. Petitioners clai% that they have al!ays been been in posse possessi ssion on of the sub4e sub4ect ct prope property rty$$ that that neither the Tan spouses nor private respondent ever too too poss posses essi sion on ther thereo eoff and and tha that resp respon onde dent nt corporation acted in bad faith.
Iss"e! 5hether the proper re%edy is annul%ent or rescission of the contract. 'rescission) R"ln$! 5here 5here the parties parties intende intended d to be boun bound d by the contr contract act excep exceptt that that it did not not reflec reflectt the actual actual purchase price of the property$ as in the case at bar bar$ ther there e is only only a rela relati tive ve si%u si%ula lati tion on of the the contract !hich re%ains valid and enforceable$ but the parties shall be bound by their real a"ree%ent. The present contract cannot be declared null and void or inexistent fro% the be"innin" since it does not not fall fall unde underr the the cate cate"o "ory ry of an abso absolu lute tely ly si%ulated or fictitious contract the basic characteristic of !hich is that the apparent contract is not really desired or intended to produce le"al effects or to alter in any !ay the 4uridical situation of the parties. Petition Petitioners ers cate"ori cate"oricall cally y ad%itte ad%itted d that that the actual actual consideration !as P/0 for each lot '%inus P, for one lot since petitioners o!ed Tan6s %other P,). 7ince there !as partial pay%ent %ade on the deed of absolute sale an action for declaration of nullity !ill not prosper. The The po!e po!err to resc rescin ind d obli obli"a "ati tion ons s is i%pl i%plie ied d in reciprocal ones$ in case one of the obli"ors should not co%ply !ith !hat is incu%bent upon hi%. The ri"ht to rescind %ay be availed of for such breaches as are substantial and funda%ental as to defeat the ob4ec 4ect of the partie rties s %ain in" the the contract ract.. #ndubitably$ under the factual settin" of this case$ the re%edy re%edy of resolu resolutio tion n of the deed deed of sale is available to petitioners. The co%plaint !as filed on May -,$ -8*+$ less than four years after the deed of abso absolut lute e sale sale !as !as execu execute ted d on June June 2$-8 2$-898 98$$ hence$ as an action to rescind$ it !as !ell !ithin the prescriptive period.
