[01-01] Coronel v. CA (GR 103577, 7 October 1996)
263 SCRA 15 Third division, Melo (J): 3 concur, 1 took no !rt" Fact! Ro#ulo Coronel e$ecuted ! docu#ent entitled %Receit o& 'on!#ent* in &!vor o& R!#on! +!trici! Alc!r!
&or +5-,--+5-,--- don! don!#e #ent nt o& the !#ount o& +1"2.M +1"2.M !s urch! urch!se se rice rice &or !n inheri inherited ted house !nd lot, ithou ithoutt reserv!tion to ithhold the tr!ns&er o& such roert until &ull !#ent" The urose o& such don!#ent !s &or the heirs to tr!ns&er the title to their n!#e" /on the re0istr!tion o& the roert to n!#e o& the heirs, the Coronels sold the s!#e roert to C!t!lin! " M!!n!0 &or +1"5M" The Coronels rescinded the contr!ct ith Alc!r! deositin0 the don!#ent !#ount in ! !nk !ccount in &!vor o& Alc!r!" Alc!r! &iled ! co#l!int &or seci&ic er&or#!nce, hich the tri!l !nd the !ell!te court ruled in her &!vor" "#e! 4hether the %receit o& don!#ent* serves ! contr!ct to sell or ! condition!l contr!ct o& s!le" $el%! The !0ree#ent is ! contr!ct o& s!le !s there !s no e$ress reserv!tion o& onershi or title to the suect !rcel
o& l!nd" +etitioners did not #erel ro#ise to sell the roert to riv!te resondent uon the &ul&ill#ent o& the susensive condition ut on the contr!r, h!vin0 !lre!d !0reed to sell the suect roert, the undertook to h!ve the certi&ic!te o& title ch!n0ed to their n!#es !nd i##edi!tel there!&ter, to e$ecute the ritten deed o& !solute s!le" The susensive condition !s &ul&illed on 6 eru!r 175 !nd thus, the condition!l contr!ct o& s!le eteen the !rties ec!#e oli0!tor, the onl !ct re8uired &or the consu##!tion thereo& ein0 the deliver o& the roert #e!ns o& the e$ecution o& the deed o& !solute s!le in ! ulic instru#ent, hich etitioners une8uivoc!ll co##itted the#selves to do !s evidenced the %Receit o& 'on +!#ent"* [01-0&] Ro'ero v. CA (GR 107&07, &3 ove'ber 1995)
25- SCRA 15 Third division, 9itu0 (J): . concur Fact! 9ir0ilio Ro#ero !nd his &orei0n !rtners decided to ut u ! centr!l !rehouse in Metro M!nil!" Al&onso lores,
in eh!l& o& nri8uet! Chu! vd!" 'e ;n0sion0, roosed the l!tter
eseci!ll i& title to the roert sold is not reserved in the vendor or i& the vendor is not 0r!nted the ri0ht to unil!ter!ll rescind rescind the contr!ct redic!ted redic!ted on the &ul&ill#ent &ul&ill#ent or non=&ul&ill#ent non=&ul&ill#ent o& the rescried rescried condition" condition" >n deter#inin deter#inin0 0 the re!l ch!r!cter o& contr!ct, the sust!nce !nd not the title 0iven the !rt is #ore si0ni&ic!nt" /on er&ection, i"e" here the seller oli0!tes hi#sel&, &or ! rice cert!in, to deliver !nd to tr!ns&er onershi o& ! seci&ic thin0 or ri0ht to the uer over hich the l!tter !0rees, the !rties !re ound not onl to the &ul&ill#ent o& h!t !s e$ressl stiul!ted ut
!lso the conse8uences hich #! e in keein0 ith 0ood &!ith, us!0e !nd l!" ein0 ! er&ected contr!ct o& s!le, no rescission c!n e h!d" The roer !ction is !n !ction &or d!#!0es" Ar0uendo th!t rescission is !v!il!le !s ! re#ed, !s rovide Article 1171 in reciroc!l oli0!tions, it #! onl e !v!iled o& the inured !rt" [01-03] F#le v. CA (GR 11&&1&, & arc* 199+)
Third division, Ro#ero (J): 3 concur Fact! r" Antonio J!coe initi!ll #ort0!0e ! 1-=hect!re roert in T!n!, Ri!l (covered TCT 32-?25) to the Rur!l
!nk o& Al!#inos, @!0un! to secure ! lo!n in the !#ount o& +1-,---" S!id #ort0!0e !s l!ter &oreclosed !nd the roert o&&ered &or ulic !uction uon his de&!ult" >n June 17., re0orio ule, !s coror!te secret!r o& the !nk, !sked Re#eli! 'ichoso !nd ;livi! Mendo! to look &or ! uer ho #i0ht e interested in the T!n! roert" The to &ound one in the erson o& Binevetch Cru" >t so h!ened th!t in J!nu!r o& s!id e!r, re0orio ule, !lso ! eeler, h!s shon interest in uin0 ! !ir o& e#er!ld=cut di!#ond e!rrin0s oned 'r" Cru" 'r" Cru h!s declined ulen !n e&&ort to cut throu0h !n le0!l i#edi#ent, ule e$ecuted on 17 ;ctoer 17., ! deed o& rede#tion on eh!l& o& r" J!coe urortedl in the !#ount o& +15,7?"?, !nd on even d!te, r" J!coe sold the roert to ule &or +?5,---"--" The h!ste ith hich the to deeds ere e$ecuted is shon the &!ct th!t the deed o& s!le !s not!ried !he!d o& the deed o& rede#tion" As 'r" Cru h!d !lre!d !0reed to the roosed !rter, ule ent to +rudenti!l !nk to t!ke ! look !t the eelr" ;n 23 ;ctoer 17., ule #et Att" el!r#ino !t the l!ttern&or#ed th!t ule !s !t the l!er
;n 26 ;ctoer 17., ule &iled ! co#l!int e&ore the RTC S!n +!lo Cit !0!inst riv!te r esondents r!in0, !#on0 other thin0s, th!t the contr!ct o& s!le over the T!n! roert e decl!red null !nd void on the 0round o& &r!ud !nd deceit" ;n 3- ;ctoer 17., the loer court issued ! te#or!r restr!inin0 order directin0 the Re0ister o& 'eeds o& Ri!l to re&r!in &ro# !ctin0 on the ertinent docu#ents involved in the tr!ns!ction" ;n 2- Bove#er 17., hoever, the s!#e court li&ted its revious order !nd denied the r!er &or ! rit o& reli#in!r inunction" A&ter tri!l, the loer court rendered its decision on ? M!rch 177 holdin0 th!t the 0enuine !ir o& e!rrin0s used !s consider!tion &or the s!le !s delivered 'r" Cru to ule, th!t the contr!ct !s v!lid even i& the !0ree#ent eteen the !rties !s rinci!ll ! !rter contr!ct, th!t the !0ree#ent h!s een consu##!ted !t the ti#e the rinci!l !rties !rted !s !t the !nk, !nd th!t d!#!0es !re due to the de&end!nts" ro# the tri!l court
[01-0] On v. CA (GR 9737, 6 #l/ 1999)
irst division, Gn!res=S!nti!0o (J): . concur Fact! ;n 1- M! 173, J!i#e ;n0 !nd souses Mi0uel !nd Ale!ndr! Roles e$ecuted !n %A0ree#ent o& +urch!se
!nd S!le* resectin0 2 !rcels o& l!nd situ!ted !t !rrio +uri, S!n Antonio, Hueon (!0ricultur!l includin0 rice #ill, i00er) &or +2M (initi!l !#ent o& +6--,--- roken into +1-3,.77"71 directl !id to seller on 22 M!rch 173 !nd +.76,5--"-7 directl !id to +> to !nser &or !rt o& seller, in !ccord!nce ith their stiul!tion th!t etitioner ! the lo!n o& the souses ith +>" To !nser &or his !l!nce o& + 1".M, ;n0 issued . ost=d!ted Metro !nk checks !!le to the souses in the !#ount o& +35-,---"-- e!ch (Check 13??-=15??11)" 4hen resented &or !#ent, ho ever, the checks ere dishonored due to insu&&icient &unds" ;n0 ro#ised to rel!ce the checks ut &!iled to do so" To #!ke #!tters orse, out o& the +.76,5--"-- lo!n o& the souses ith +>, hich on0, !s er !0ree#ent, should h!ve !id, ;n0 onl #!n!0ed to dole out no #ore th!n +373,6?7"6-" 4hen the !nk thre!tened to &oreclose the souses< #ort0!0e, the sold 3 tr!ns&or#ers o& the rice #ill orth +51,.11"-- to ! o&& their outst!ndin0 oli0!tion ith s!id !nk, ith the knoled0e !nd con&or#it o& ;n0" ;n0, in return, volunt!ril 0!ve the souses !uthorit to oer!te the rice #ill" Fe, hoever, continued to e in ossession o& the to !rcels o& l!nd hile the souses ere &orced to use the rice #ill &or residenti!l uroses" ;n 2 Au0ust 175, the souses, throu0h counsel, sent ;n0 ! de#!nd letter !skin0 &or the return o& the roerties" Their de#!nd !s le&t unheeded, so, on 2 Sete#er 175, the &iled ith the RTC @ucen! Cit, r!nch 6-, ! co#l!int &or rescission o& contr!ct !nd recover o& roerties ith d!#!0es" @!ter, hile the c!se !s still endin0 ith the tri!l court, ;n0 introduced #!or i#rove#ents on the suect roerties constructin0 ! co#lete &ence #!de o& hollo locks !nd e$!ndin0 the i00er" These ro#ted the souses to !sk &or ! rit o& reli#in!r inunction hich the tri!l court 0r!nted, !nd thus enoined ;n0 &ro# introducin0 i#rove#ents on the roerties e$cet &or re!irs" ;n 1 June 177, the tri!l court rendered ! decision in &!vor o& the souses: orderin0 the contr!ct entered into the !rties set !side, orderin0 the deliver o& the !rcels o& l!nd !nd the
i#rove#ents thereon to the souses, orderin0 the return o& the su# o& +.7?,1?7"51 to ;n0 the souses, orderin0 ;n0 to ! the souses +1--,--- &or e$e#l!r d!#!0es !nd +2-,--- !s !ttornen !&&ir#in0 the decision o& the tri!l court, the Court o& Ae!ls noted th!t the &!ilure o& etitioner to co#letel ! the urch!se rice is ! sust!nti!l re!ch o& his oli0!tion hich entitles the riv!te resondents to rescind their contr!ct under Article 1171 o& the Be Civil Code" Fence, the etition &or revie on certior!ri" The Sure#e Court !&&ir#ed the decision rendered the Court o& Ae!ls ith the #odi&ic!tion th!t the souses !re ordered to return to ;n0 the su# +.,6-"-- in !ddition to the !#ounts !lre!d !!rded ith costs !0!inst etitioner ;n0"
[01-05] Gate v. Fonacer (GR -11+&7, 31 #l/ 1961)
n !nc, Rees J@ (J): 7 concur Fact! >s!elo on!cier !s the oner !ndIor holder o& 11 iron lode #iner!l cl!i#s ('!!h!n rou), situ!ted in Jose
+!n0!ni!n, C!#!rines Borte" ! %'eed o& Assi0n#ent* d!ted 27 Sete#er 1752, on!cier constituted !nd !ointed ern!ndo A" !ite !s his true !nd l!&ul !ttorne=in=&!ct to enter into ! contr!ct ith !n individu!l or uridic!l erson &or the e$lor!tion !nd develo#ent o& the #inin0 cl!i#s on ! ro!lt !sis o& not less th!n +-"5- er ton o& ore th!t #i0ht e e$tr!cted there&ro#" ;n 17 M!rch 175., !ite in turn e$ecuted ! 0ener!l !ssi0n#ent convein0 the develo#ent !nd e$loit!tion o& s!id #inin0 cl!i#s unto the @!r! >ron Mines, oned solel hi#" There!&ter !ite e#!rked uon the develo#ent !nd e$loit!tion o& the #inin0 cl!i#s, oenin0 !nd !vin0 ro!ds ithin !nd outside their ound!ries, #!kin0 other i#rove#ents !nd inst!llin0 &!cilities therein &or use in the develo#ent o& the #ines, !nd in ti#e e$tr!cted there&ro# h!t he cl!i#ed !nd esti#!ted to e !ro$i#!tel 2.,--- #etric tons o& iron ore" or so#e re!son or !nother, >s!elo on!cier decided to revoke the !uthorit 0r!nted hi# to !ite, !nd !ite !ssented thereto suect to cert!in conditions" As ! result, ! docu#ent entitled %Revoc!tion o& +oer o& Attorne !nd Contr!ct* !s e$ecuted on 'ece#er 175., herein !ite tr!ns&erred to on!cier, &or the consider!tion o& +2-,---, lus 1- o& the ro!lties th!t on!cier ould receive &ro# the #inin0 cl!i#s, !ll his ri0hts !nd interests on !ll the ro!ds, i#rove#ents, !nd &!cilities in or outside s!id cl!i#s, the ri0ht to use the usiness n!#e %@!r! >ron Mines* !nd its 0oodill, !nd !ll the records !nd docu#ents rel!tive to the #ines" >n the s!#e docu#ent, !ite tr!ns&erred to on!cier !ll his ri0hts !nd interests over the %2.,--- tons o& iron ore, #ore or less* th!t the &or#er h!d !lre!d e$tr!cted &ro# the #iner!l cl!i#s, in consider!tion o& the su# o& +?5,---, +1-,---, o& hich !s !id uon the si0nin0 o& the !0ree#ent, !nd the !l!nce to e !id out o& the &irst letter o& credit coverin0 the &irst shi#ent o& iron ores or the &irst !#ount derived &ro# the loc!l s!le o& iron ore #!de the @!r! Mines K S#eltin0 Co" To secure the !#ent o& the !l!nce, on!cier ro#ised to e$ecute in &!vor o& !ite ! suret ond delivered on 'ece#er 175. ith on!cier !s rinci!l !nd the @!r! Mines !nd S#eltin0 Co" !nd its stockholders !s sureties" A second ond !s e$ecuted the !rties to the &irst ond, on the s!#e d!, ith the !r !stern Suret !nd >nsur!nce Co" !s !ddition!l suret, ut it rovided th!t the li!ilit o& the suret co#!n ould !tt!ch onl hen there h!d een !n !ctu!l s!le o& iron ore the @!r! Mines K S#eltin0 Co" &or !n !#ount o& not less th!n +65,---" oth ond ere !tt!ched !nd #!de inte0r!l !rts o& the %Revoc!tion o& +oer o& Attorne !nd Contr!ct"* ;n the s!#e d! th!t on!cier revoked the oer o& !ttorne, on!cier entered into ! %Contr!ct o& Minin0 ;er!tion* ith @!r! Mines !nd S#eltin0 Co", >nc" to 0r!nt it the ri0ht to develo, e$loit, !nd e$lore the #inin0 cl!i#s, to0ether ith the i#rove#ents therein !nd the use o& the n!#e %@!r! >ron Mines* !nd its 0oodill, in consider!tion o& cert!in ro!lties" on!cier likeise tr!ns&erred, in the s!#e docu#ent, the co#lete title to the !ro$i#!tel 2.,--- tons o& iron ore hich he !c8uired &ro# !ite, to the @!r! Mines K S#eltin0 Co", in consider!tion &or the si0nin0 the co#!n !nd its stockholders o& the suret onds delivered on!cier to !ite" ;n 'ece#er 1755, the ond ith resect to the !r !stern Suret !nd >nsur!nce Co#!n e$ired ith no s!le o& the !ro$i#!tel 2.,--- tons o& iron ore, nor h!d the 65,--- !l!nce o& the rice o& s!id ore een !id to !ite
on!cier !nd his sureties" 4hereuon, !ite de#!nded &ro# on!cier !nd his sureties !#ent o& s!id !#ount" 4hen on!cier !nd his sureties &!iled to ! !s de#!nded !ite, the l!tter &iled ! co#l!int !0!inst the# in the C> M!nil! (Civil C!se 2731-) &or the !#ent o& the +65,--- !l!nce o& the rice o& the ore, conse8uenti!l d!#!0es, !nd !ttorne
irst 'ivision, +!dill! (J): . concur Fact! The title to @ot 113- o& the C!d!str!l Surve o& Fini0!r!n, Be0ros ;ccident!l !s evidenced ;CT R=121?7"
The lot h!s !n !re! o& 13,?2- s8" #" The title !s issued !nd is re0istered in the n!#e o& souses S!nti!0o 9!s8ue !nd @oren! ;ru#!" A&ter oth souses died, their onl son eli$erto inherited the lot" >n 17?5, eli$erto e$ecuted ! dul not!ried docu#ent entitled %'ecl!r!tion o& Feirshi !nd 'eed o& Asolute S!le* in &!vor o& Cos#e +ido" Since 176-, Teodoro Ac! h!d een the ten!nt o& ! ortion o& the s!id l!nd, coverin0 !n !re! o& 7,5-- s8" #" 4hen onershi !s tr!ns&erred in 17?5 eli$erto to Cos#e +ido, Ac! continued to e the re0istered ten!nt thereo& !nd reli0iousl !id his le!sehold rent!ls to +ido !nd there!&ter, uon +idot ill e noted th!t !t the ti#e o& Cos#e +idon 172, Ac! !lle0edl co#lied ith s!id oli0!tion" >n 173, hoever, Ac! re&used to ! !n &urther le!se rent!ls on the l!nd, ro#tin0 delos Rees to seek the !ssist!nce o& the then Ministr o& A0r!ri!n Re&or# (MAR) in Fini0!r!n, Be0ros ;ccident!l" The MAR invited Ac!, ho sent his i&e, to ! con&erence scheduled on 13 ;ctoer 173" The i&e st!ted th!t the she !nd her hus!nd did not reco0nie delos Rees
[01-07] 4#a%a v. CA (GR 1&6, ece'ber 199+)
Second 'ivision, M!rtine (J): 3 concur Fact! +etitioners (Al&onso, Cresente, Ren!ld!, 'e#etrio, liuteri!, ul!lio, !nd 4!rlito) !re the children o& the l!te
Trinid!d Corver! 9d!" de Hui!d!" Trinid!d !s one o& the heirs o& the l!te +edro Corver! !nd inherited &ro# the l!tter the 2=hect!re !rcel o& l!nd suect o& the c!se, situ!ted in the !rrio o& S!n A0ustin, T!l!co0on, A0us!n del Sur" ;n 5 Aril 1756, Trinid!d Hui!d! to0ether ith her sisters @eonil! Corver! 9d!" de Se8uen! !nd +! Corver! C!iltes !nd rother !i!dito Corver! e$ecuted ! condition!l deed o& don!tion o& the 2=hect!re !rcel o& l!nd in &!vor o& the Munici!lit o& T!l!co0on, the condition ein0 th!t the !rcel o& l!nd sh!ll e used solel !nd e$clusivel !s !rt o& the c!#us o& the roosed rovinci!l hi0h school in T!l!co0on" A!rentl, Trinid!d re#!ined in ossession o& the !rcel o& l!nd desite the don!tion" ;n 27 Jul 1762, Trinid!d sold 1 hect!re o& the suect !rcel o& l!nd to Re0!l!do Monde!r" Suse8uentl, Trinid!d ver!ll sold the re#!inin0 1 hect!re to Monde!r ithout the ene&it o& ! ritten deed o& s!le !nd evidenced solel receits o& !#ent" >n 17-, the heirs o& Trinid!d, ho !t th!t ti#e !s !lre!d de!d, &iled ! co#l!int &or &orcile entr !0!inst Monde!r, hich co#l!int !s, hoever, dis#issed &or &!ilure to rosecute" >n 17?, the roosed rovinci!l hi0h school h!vin0 &!iled to #!teri!lie, the S!n00uni!n0 !!n o& the #unici!lit o& T!l!co0on en!cted ! resolution revertin0 the 2 hect!res o& l!nd don!ted !ck to the donors" >n the #e!nti#e, Monde!r sold ortions o& the l!nd to ern!ndo !utist!, Rodol&o olor!n, &ren uden, !nd rnesto olor!n" ;n 5 Jul 17, the etitioners &iled ! co#l!int !0!inst riv!te resondents (Monde!r, Rodul&o !nd rnesto olor!n, Asis, R!s, Aiso, !utist!, M!c!sero !nd M!0uis!) &or 8uietin0 o& title, recover o& ossession !nd onershi o& !rcels o& l!nd ith cl!i# &or !ttorne
irst 'ivision, en0on (J): ? concur Fact! Celestino Co K Co#!n is ! dul re0istered 0ener!l co!rtnershi doin0 usiness under the tr!de n!#e o&
%;rient!l S!sh !ctor*" ro# 17.6 to 1751 it !id ercent!0e t!$es o& ? on the 0ross receits o& its s!sh, door !nd indo &!ctor, in !ccord!nce ith section 16 o& the B!tion!l Revenue Code i#osin0 t!$es on s!les o& #!nu&!ctured !rticles" Foever in 1752 it e0!n to cl!i# li!ilit onl to the contr!ctorntern!l Revenue, it rou0ht the #!tter to the Court o& T!$ Ae!ls, here it !lso &!iled" Fence, the !e!l" The Sure#e Court !&&ir#ed the !e!led decision" 1. #ne na'e an% nco'e 'ltate aant cla' a or%nar/ contractor
The co#!n h!s t!ken !ll the troule !nd e$ense o& re0isterin0 ! seci!l tr!de n!#e &or its s!sh usiness !nd h!s ordered co#!n st!tioner c!rrin0 the old rint %;rient!l S!sh !ctor (Celestino Co K Co#!n, +ro") 726 R!on St" Hui!o, M!nil!, Tel" Bo" 33-?6, M!nu&!cturers o& !ll kinds o& doors, indos, s!shes, &urnitures, etc" used se!son=dried !nd kiln=dried lu#er, o& the est 8u!lit ork#!nshi"* >t is unlikel th!t these !ct ere #!de solel &or the urose o& sulin0 the needs &or doors, indos !nd s!sh o& its seci!l !nd li#ited custo#ers" urther, the Co#!n h!s chosen &or its tr!den!#e !nd h!s o&&ered itsel& to the ulic !s ! %!ctor*, hich #e!ns it is out to do usiness, in its chosen lines on ! i0 sc!le" Moreover, !s shon &ro# the investi0!tion o& the Co#!nt ill e di&&icult to elieve th!t such !#ount th!t r!n to si$ &i0ures !s derived entirel &ro# its &e custo#ers ho #!de seci!l orders" Thus, Celestino Co K Co#!n h!itu!ll #!kes s!sh, indos !nd doors, !s it h!s reresented in its st!tioner !nd !dvertise#ents to the ulic, !nd it h!s !d#itted the !ell!nt itsel& th!t the co#!n %#!nu&!ctures"* &. Contr#cton 8or contractor %ene%
Construction ork contr!ctors !re those ho !lter or re!ir uildin0s, structures, streets, hi0h!s, seers, street r!il!s, r!ilro!ds, lo00in0 ro!ds, electric, ste!# or !ter l!nts tele0r!h !nd telehone l!nts !nd lines, electric lines or oer lines, !nd includes !n other ork &or the construction, !lterin0 or re!irin0 &or hich #!chiner driven #ech!nic!l oer is used" (+!ton vs" Cit o& An!d!rdo 6. +" 2d ?, -, 1?7 ;kl" 6)" 3. at#re o b#ne %oe not all n an/ o t*e occ#2aton t*at 'a/ be clae% a contractor 8t*n t*e 2#rve8 o :ecton 191 o t*e atonal "nternal Reven#e Co%e
ven i& it ere to elieve th!t the co#!n does not #!nu&!cture re!d=#!de s!sh, doors !nd indos &or the ulic !nd th!t it #!kes these !rticles onl uon seci!l order o& its custo#ers, th!t does not #!ke it ! contr!ctor ithin the urvie o& section 171 o& the B!tion!l >ntern!l Revenue Code" There !re no less th!n &i&t occu!tions enu#er!ted in the s!id section o& the B!tion!l >ntern!l Revenue Code suect to ercent!0e t!$, not one under hich the usiness enterrise o& etitioner could !rori!tel &!ll" >t ould re8uire ! stretch o& the l! to #!ke the usiness o& #!nu&!cturin0 s!sh, doors !nd indos uon seci!l order o& custo#ers &!ll under the c!te0or o& Lro!d, uildin0, n!vi0!tion, !rtesi!n ell, !ter orks !nd other construction ork contr!ctors" . ;ercentae ta< '2oe% #n%er :ecton 191 o t*e =a< Co%e a ta< on ale o ervce, 8*le ta< '2oe% b/ :ecton 1+6 a ta< on ornal ale o artcle
The ercent!0e t!$ i#osed in section 171 o& the T!$ Code is 0ener!ll ! t!$ on the s!les o& services, in contr!diction ith the t!$ i#osed in section 16 o& the s!#e Code hich is ! t!$ on the ori0in!l s!les o& !rticles the #!nu&!cturer, roducer or i#orter" (or#ille!ntern!l Revenue Code, 9ol >>, " ?..)" The &!ct th!t the !rticles sold !re #!nu&!ctured the seller does not e$ch!n0e the contr!ct &ro# the urvie o& section 16 o& the B!tion!l >ntern!l Revenue Code !s ! s!le o& !rticles" 5. C#to' 2eccaton re>#re% b/ c#to'er %oe not alter c*aracter o b#ne, t*e co'2an/ %oe not beco'e an
e'2lo/ee or ervant o t*e c#to'er
Bood ill s! th!t hen ! s!#ill cuts lu#er in !ccord!nce ith the eculi!r seci&ic!tions o& ! custo#er, sies not reviousl held in stock &or s!le to the ulic, it there eco#es !n e#loee or serv!nt o& the custo#er, not the seller o& lu#er" The s!#e consider!tion !lies to this s!sh #!nu&!cturer" The S!sh !ctor does nothin0 #ore th!n sell the 0oods th!t it #!ss=roduces or h!itu!ll #!kes s!sh, !nels, #ouldin0s, &r!#es, cuttin0 the# to such sies !nd co#inin0 the# in such &or#s !s its custo#ers #! desire" 6. "ntallaton o 8n%o8 2anel not contr#cton 8or n co''on 2arlance
+etitioner
Article 1.6? o& the Be Civil Code rovides th!t %! contr!ct &or the deliver !t ! cert!in rice o& !n !rticle hich the vendor in the ordin!r course o& his usiness #!nu&!ctures or rocures &or the 0ener!l #!rket, hether the s!#e is on h!nd !t the ti#e or not, is ! contr!ct o& s!le, ut i& the 0oods !re to e #!nu&!ctured seci!ll &or the custo#er !nd uon his seci!l order, !nd not &or the 0ener!l #!rket, it is contr!ct &or ! iece o& ork"* >n the resent c!se, it is !!rent th!t the !ctor did not #erel sell its services to Teodoro K Co" ec!use it !lso sold the #!teri!ls" 4hen it sold #!teri!ls ordin!ril #!nu&!ctured it (s!sh, !nels, #ouldin0s), !lthou0h in such &or# or co#in!tion !s suited the &!nc o& the urch!ser, such ne &or# does not divest the !ctor o& its ch!r!cter !s #!nu&!cturer" Beither does it t!ke the tr!ns!ction out o& the c!te0or o& s!les under Article 1.6? ec!use !lthou0h the !ctor does not, in the ordin!r course o& its usiness, #!nu&!cture !nd kee on stock doors o& the kind sold to Teodoro, it could stock !ndIor ro!l h!d in stock the s!sh, #ouldin0s !nd !nels it used there&or" +. Contract or a 2ece o 8or n Factor/ *a22en t*e #e o e#2'ent re>#re% or t nvolve ervce not enerall/ 2eror'e% b/ t
4hen the !ctor !ccets ! o th!t re8uires the use o& e$tr!ordin!r or !ddition!l e8ui#ent, or involves services not 0ener!ll er&or#ed it, it there contr!cts &or ! iece o& ork, i"e" &illin0 seci!l orders ithin the #e!nin0 o& Article 1.6?" >n the resent c!se, hoever, the orders e$hiited ere not shon to e seci!l" The ere #erel orders &or ork, re0ul!r ork" 9. =raner #n%er :ecton 1+6 o t*e =a< Co%e
>& !ll the ork o& !ell!nt is onl to &ill orders reviousl #!de, such orders should not e c!lled seci!l ork, ut re0ul!r ork !nd suosin0 &or the #o#ent th!t the tr!ns!ctions ere not s!les, the ere neither le!se o& services nor contr!ct os ! contr!ctor" Still, !s the doors !nd indos h!d een !d#ittedl %#!nu&!ctured* the S!sh !ctor, such tr!ns!ctions could e, !nd should e t!$ed !s %tr!ns&ers* thereo& under section 16 o& the B!tion!l Revenue Code" 2ndN :ale (under Atty. Amadeo Paolo Dimayuga, Arellano Law, First Semester, SY 2003-2004. Full sylla!us"# htt:IIerne0uerrero"co#InodeI27 21 [01-09] C"R v. ?nneern ?>#2'ent an% :#22l/ (GR -&70, 30 #ne 1975)
n0ineerin0 8ui#ent !nd Sul v" C>R "R" Bo" @=2?.52" June 3-, 17?5"N irst 'ivision, s0uerr! (J): . concur Fact! n0ineerin0 8ui#ent !nd Sul Co" is !n en0ineerin0 !nd #!chiner &ir# !nd ein0 !n oer!tor o& !n
inte0r!ted en0ineerin0 shi, is en0!0ed in the desi0n !nd inst!ll!tion o& centr!l te !ir conditionin0 sste#, u#in0 l!nts !nd steel &!ric!tions" ;n 2? Jul 1756, one Ju!n de l! Cru, rote the then Collector, no Co##issioner, o& >ntern!l Revenue denouncin0 the Co#!n &or t!$ ev!sion #isdecl!rin0 its i#orted !rticles !nd &!ilin0 to ! the correct ercent!0e t!$es due thereon in conniv!nce ith its &orei0n suliers" The Co#!n !s likeise denounced to the Centr!l !nk &or !lle0ed &r!ud in ot!inin0 its doll!r !lloc!tions" Actin0 on these denunci!tions, ! r!id !nd se!rch !s conducted ! oint te!# o& Centr!l !nk, (C), B!tion!l ure!u o& >nvesti0!tion (B>) !nd ure!u o& >ntern!l Revenue (>R) !0ents on 2? Sete#er 1756, on hich occ!sion volu#inous records o& the &ir# ere seied !nd con&isc!ted" ;n 3- Sete#er 175?, revenue e$!#iners reorted !nd reco##ended to the then Collector, no Co##issioner, o& >ntern!l Revenue th!t the Co#!n e !ssessed &or +.-,712"-1 !s de&icienc !dv!nce s!les t!$ on the theor th!t it #isdecl!red its i#ort!tion o& !ir conditionin0 units !nd !rts !nd !ccessories thereo& hich !re suect to t!$ under Section 15(#) 1 o& the T!$ Code, inste!d o& Section 16 o& the s!#e Code" This !ssess#ent !s revised on 23 J!nu!r 1757, in line ith the oserv!tion o& the Chie&, >R @! 'ivision, !nd !s r!ised to +716,362"56 reresentin0 de&icienc !dv!nce s!les t!$ !nd #!nu&!cturers s!les t!$, inclusive o& the 25 !nd 5- surch!r0es" ;n 3 M!rch 1757, the Co##issioner !ssessed !0!inst, !nd de#!nded uon, the Co#!n !#ent o& the incre!sed !#ount !nd su00ested th!t +1-,--- e !id !s co#ro#ise in e$tr!udici!l settle#ent o& the Co#!n
Third 'ivision, +!n0!ni!n (J): 3 concur Fact! +ursu!nt to the contr!ct d!ted 1- Sete#er 1762 eteen the n0ineerin0 !nd M!chiner Coror!tion (the
Coror!tion) !nd Al#ed!, the &or#er undertook to &!ric!te, &urnish !nd inst!ll the !ir=conditionin0 sste# in the l!tternvest#ent !nd 'evelo#ent Coror!tion (B>'C)" The l!tter took ossession o& the uildin0 ut on !ccount o& B>'C
17?1" >t !s then th!t he le!rned &ro# so#e B>'C e#loees o& the de&ects o& the !irconditionin0 sste# o& the uildin0" Actin0 on this in&or#!tion, Al#ed! co##issioned n0ineer '!vid R" S!ico to render ! technic!l ev!lu!tion o& the sste# in rel!tion to the N contr!ct ith the Coror!tion" >n his reort, S!ico enu#er!ted the de&ects o& the sste# !nd concluded th!t it !s %not c!!le o& #!int!inin0 the desired roo# te#er!ture o& ?6o O 2o"* ;n the !sis o& this reort, Al#ed! &iled on M! 17?1 !n !ction &or d!#!0es !0!inst the Coror!tion ith the then C> Ri!l (Civil C!se 1.?12)" The co#l!int !lle0ed th!t the !ir=conditionin0 sste# inst!lled the Coror!tion did not co#l ith the !0reed l!ns !nd seci&ic!tions, hence, Al#ed! r!ed &or the !#ount o& +21-,---"-- reresentin0 the recti&ic!tion cost, +1--,---"-- !s d!#!0es !nd +15,---"-- !s !ttornen due course, !nd on 15 Aril 17?., the tri!l court rendered ! decision, hich ordered the Coror!tion to ! Al#ed! the !#ount needed to recti& the &!ults !nd de&iciencies o& the !ir=conditionin0 sste# inst!lled the Coror!tion in Al#ed!
irst 'ivision, @!urel (J): . concur Fact! on!lo +u!t K Sons is the e$clusive !0ent o& St!rr +i!no Co#!n o& Rich#ond, >ndi!n! /SA, in the
+hiliines" Te!tro Arco, or Arco A#use#ent Co#!n, desirin0 to e8ui its cine#!to0r!h ith sound reroducin0 devices, !ro!ched +u!t" >t !s !0reed the !rties th!t +u!t ould in eh!l& o& Arco order e8ui#ent &ro# St!rr +i!no !nd th!t Arco ould ! +u!t in !ddition to rice o& the e8ui#ent, 1- co##ission lus !ll e$enses such !s &rei0ht, insur!nce, !nkin0 ch!r0es, c!les, etc" +u!t in&or#ed Arco th!t the rice o& the e8ui#ent !s D1,?--, to hich Arco !0reed" @!ter, ! si#il!r !rr!n0e#ent !s #!de Arco &or the urch!se o& si#il!r e8ui#ent &or D1,6-ith 1- co##ission, ith +u!t ch!r0in0 !n !ddition!l &l!t ch!r0e o& D16- &or !ll e$enses !nd ch!r0es" 3 e!rs l!ter, Arco le!rned th!t the rice 8uoted +u!t on the 2 orders ere not the net rice ut the list rice &or the e8ui#ent" Arco &iled ! co#l!int ith the tri!l court (C>) de#!ndin0 rei#urse#ent &ro# s!id %overriced* s!les" The tri!l court ruled in &!vor o& +u!t, ut the Court o& Ae!ls reversed such decision !nd decl!red +u!t !n !0ent o& Arco A#use#ent in the urch!se o& s!id e8ui#ent" "#e! 4hether the !0ree#ent #!de eteen +u!t !nd Arco A#use#ent is th!t o& urch!se !nd s!le or th!t o&
!0enc" $el%! on!lo +u!t K Sons c!nnot e the !0ent o& Arco A#use#ent in the urch!se o& e8ui#ent &ro# St!rr +i!no
Co#!n !s +u!t K Sons is !lre!d the e$clusive !0ent o& St!rr +i!no in the +hiliines" +u!t c!nnot e the !0ent o& oth vendor !nd urch!ser" The &!ct th!t ! co##ission !s o&&ered to the other does not necess!ril #e!n th!t the l!tter h!s eco#e the !0ent o& the &or#er, !s this !s onl !n !ddition!l rice hich Arco ound itsel& to ! !nd hich is not inco#!tile ith the contr!ct o& urch!se !nd s!le" +u!t is not ound to rei#urse the ro&it !c8uired in the tr!ns!ction, !s this is the ver essence o& co##erce involvin0 #iddle#en !nd #erch!nts" The contr!ct is the l! eteen the !rties" 4h!t does not !e!r on the &!ce o& the contr!ct should e re0!rded !s %de!ler
[01-1&] 4#roa v. CA (GR 1191, &3 A##t 191+)
3 +hil 5-1 n !nc, Av!ncen! (J): 5 concur Fact! A contr!ct !s entered eteen Huiro0! !nd +!rsons &or the e$clusive s!le o& Huiro0! eds in the 9is!!s
>sl!nds, seci&ic!ll >loilo" Huiro0! &urnishes the eds to +!rson, ho in turn ! the rice in the #!nner stiul!ted" Huiro0! rovided ! discount o& 2- to 25 &or the eds, deendin0 on their cl!ss" @!ter, Huiro0! &iled ! c!se !0!inst +!rsons &or viol!tion o& its oli0!tion not to sell the eds !t hi0her rice th!n those o& the invoices, etc" (hich !re not e$ressl stiul!ted in the contr!ct, e$cet &or the #!nner the eds !re ordered the doen)" Huiro0! #!int!ins th!t +!rson is his !0ent &or the s!le o& his eds in >loilo, !nd th!t the contr!ct is th!t o& co##erci!l !0enc" "#e! 4hether the cont!ct is th!t o& s!le or o& co##erci!l !0enc" $el%! The contr!ct eteen the !rties is ! contr!ct o& urch!se !nd s!le !s +!rson, receivin0 the ed, !s
necess!ril oli0ed to ! their rice ithin the ter# &i$ed, ithout !n other consider!tion !nd re0!rdless !s to hether he h!d or h!d not sold the ed" The ords %co##ission on s!les* in the contr!ct is nothin0 else th!n ! #ere discount on the invoice rice" urther, the ord %!0enc* used thereon onl e$resses th!t +!rson !s the sole seller o& Huiro0! eds in the 9is!!s" Bone o& the other cl!uses o& the contr!ct !re not inco#!tile ith the contr!ct o& urch!se !nd s!le" [0&] ;arte to a Contract o :ale [0&-01] e%na v. C"R (GR -15113, &+ an#ar/ 1961)
1 SCRA 3-2 n !nc, Rees J@ (J): 6 concur Fact! Antonio Medin! is #!rried to Antoni! Rodri0ue (since 17..), oth not h!vin0 roert or usiness o& their on
!t th!t ti#e o& #!rri!0e" Antonio in 17.6 !c8uire &orest concessions in >s!el! (Sn" M!ri!no !nd +!l!n!n)" @o0s cut !nd re#oved Antonio &ro# his concessions ere initi!ll sold to di&&erent ersons in M!nil! throu0h his !0ent M!ri!no ;sorio" The i&e l!ter en0!0ed in usiness !s lu#er de!ler !nd sold !ll lo0s roduced in the Sn" M!ri!no concession to ersons in M!nil! throu0h the s!#e !0ent" The Collector o& >ntern!l Revenue i#osed ! t!$ !ssess#ent on Antonio Medin! considerin0 the s!les o& the i&e !s th!t o& AntonioRC" Antonio !e!led, contendin0 th!t the souses h!d ! re#!rit!l !0ree#ent o& !solute se!r!tion o& roert, the records o& hich !s !lle0edl destroed durin0 4orld 4!r >>" The Collector #odi&ied the !ssess#ent, reducin0 the !#ount to e !id" Antonio re8uested &or consider!tion, ut hich !s denied" Antonio !e!led to the CTA, hich uheld the !ssess#ent o& the collector e$cet &or so=c!lled co#ro#ise en!lties"E Antonio &iled resent etition" "#e! 4hether the s!le #!de Antonio to his i&e ere v!lid so !s to e$e#t the s!les #!de Antoni! &ro# ein0
considered !s !rt o& AntonioRC" $el%! As there is no evidence o& ! re=#!rit!l !0ree#ent o& !solute se!r!tion eteen the souses, the s!les #!de
Antonio (!s &orest concession!ire) to his i&e (!s lu#er de!ler) !re null !nd void !s these !re contr!cts viol!tive o& Article 1.7- o& the Civil Code" ein0 void tr!ns!ctions, the s!les #!de Antonio to his i&e ere correctl disre0!rded the Collector in his t!$ !ssess#ents th!t considered !s the t!$!le s!les those #!de the i&e throu0h the souses< co##on !0ent, ;sorio"
[0&-0&] Cal'l'-Can#lla v. Fort#n (GR 5799, && #ne 19+)
12 SCRA 6?5 irst 'ivision, Melencio=Ferrer! (J): 5 concur Fact! ern!ndo C!null!s !nd Mercedes C!li#li# ere #!rried in 1762" The lived in ! s#!ll house on ! 71 s8"#"
residenti!l l!nd in +!n0!sin!n (!0!!c, u0!llon)" 4hen C!null!s< &!ther died in 1765, he inherited the l!nd" >n 17?, he !!ndoned the &!#il !nd lived ith Cor!on '!0uines" >n 17-, he sold the roert to '!0uines &or +2,---" '!0uines &iled ! co#l!int &or 8uietin0 o& title !nd d!#!0es !0!inst Mercedes, !&ter the &or#er !s un!le to t!ke ossession o& the house !nd lot" The tri!l court (C>) ruled in &!vor o& '!0uines, rulin0 th!t she is the oner o& " o& the l!nd !s ell !s " o& the house erected on s!id l!nd" /on reconsider!tion, the ud0#ent !s #odi&ied herein '!0uines is the oner o& the l!nd !nd 1- coconut trees thereon, !nd the s!le o& the conu0!l house includin0 3 coconuts !nd other cros l!nted durin0 the conu0!l rel!tion o& the souses is null !nd void" "#e! 4hether the s!le #!de ern!ndo C!null!s to Cor!on '!0uines !s v!lid" $el%! The contr!ct o& s!le !s null !nd void &or ein0 contr!r to #or!ls !nd ulic olic, ursu!nt to Article 1.-7 o&
the Civil Code" The s!le !s #!de ! hus!nd in &!vor o& ! concuine !&ter he h!d !!ndoned his &!#il !nd le&t the conu0!l ho#e here his i&e !nd children lived !nd &ro# hence the derived their suort" Th!t s!le !s suversive o& the st!ilit o& the &!#il, ! !sic soci!l institution hich ulic olic cherishes !nd rotects" [0&-03] G#an v. CA (GR 1&517&, &6 #ne 199+)
271 SCRA 3?2 irst 'ivision, +!n0!ni!n (J): . concur Fact! Judie !nd ild! Coru ere #!rried in 176 in !colod Cit" >n 173, the souses ou0ht ! lot in South
Cot!!to (r0" en" +!ulino S!ntos, Poron!d!l) &ro# M!nuel C!lleo throu0h ! condition!l deed o& s!le, the consider!tion !!le in inst!ll#ent" >n 17, the souses sold h!l& o& the l!nd to Antonio !nd @uvi#ind! ui!n0" The l!tter uild their house on their h!l& o& the lot" >n 177, ild! ent to M!nil!, ith the consent o& her hus!nd, to look &or ork !ro!d" She ec!#e ! victi# o& !n unscruulous ille0!l recruiter" 4hile she !s in M!nil!, her hus!nd sold the re#!inin0 h!l& o& the roert to the ui!n0s, even i& the l!tter heldthe letter o& ild!
51 SCRA 12irst 'ivision, Teeh!nkee (J): concur Fact! r!ncisco Milit!nte cl!i#ed onershi over l!nd in >loilo (o" en" @un!, !rot!c 9ieo), to hich he &iled !n
!lic!tion &or re0istr!tion o& title ith the C> >loilo" The !lic!tion !s oosed the 'irector o& @!nds" The C> dis#issed the re0istr!tion" +endin0 disos!l o& the !e!l in the Court o& Ae!ls, Milit!nte sold the l!nd to 'o#in0o Rui!s, his son=in=l! !nd ! l!er ro&ession" Rui!s decl!red the l!nd &or t!$!tion uroses under v!rious t!$ decl!r!tions !nd l!nd t!$es" The CA likeise dis#issed Milit!ntes!i!s !tiller" >n 176-, Rui!s &iled ! &orcile entr c!se !0!inst !tiller e&ore the #unici!l court, hich the l!tter ruled in &!vor o& !tiller" Rui!s !e!led to the C>, hich !&&ir#ed the ud0#ent in &!vor o& !tiller" >n 176., Rui!s &iled ! suit to recover onershi !nd ossession o& l!nd to cl!i# ortions o& lot, ou0ht &ro# Milit!nte, hich ere occuied !tiller" The loer court (C>) dis#issed the c!se" Rui!s !e!led to the Court o& !e!ls hich certi&ied the !e!l to the Sure#e Court &or involvin0 urel le0!l 8uestions" "#e! 4hether the s!le o& the lot r!ncisco Milit!nte to his son=in=l! 'o#in0o Rui!s is v!lid &or the l!tter to cl!i#
onershi over s!id lot $el%! The urch!se ! l!er o& the roert in liti0!tion &ro# his client is c!te0oric!ll rohiited Article 1.71,
!r!0r!h (5) o& the Civil Code, !nd th!t conse8uentl, Rui!s< urch!se o& the roert in liti0!tion &ro# his &!ther=in= l! !s void !nd could roduce no le0!l e&&ect (Article 1.-7 ?N o& the Civil Code)" >t is void !nd not void!le (!s the 1727 c!se o& 'irector o& @!nds v" A!0!t hich decl!red such urch!se void suerceded the 1711 c!se o& 4ol&son v" st!te o& M!rtine hich decl!red such urch!se #ere void!le)" The nullit o& rohiited contr!cts is de&inite !nd er#!nent !nd c!nnot e cured r!ti&ic!tion" The ulic interest !nd ulic olic re#!in !r!#ount !nd do not er#it o& co#ro#ise or r!ti&ic!tion" Foever, hen the c!uses o& nullit hich h!ve ce!sed to e$ist, ! second contr!ct #! e e$ecuted !nd ould then e v!lid &ro# its e$ecution hoever, it does not retro!ct to the d!te o& the &irst contr!ct" Still, Rui!s co#l!int, to e decl!red !solute oner o& the l!nd !nd to e restored to ossession thereo& ith d!#!0es, !s ene&t o& !n &!ctu!l or le0!l !sis" The CA
77 +hil 372 n !nc, en0on (J): concur Fact! 1? !rcels o& l!nd (ui0uinto, ul!c!n) ere inherited M!ri!no @" ern!rdo &ro# his &!ther" Socorro Rold!n,
his ste#other, !s !ointed the court !s his 0u!rdi!n" Rold!n !s !le to secure er#ission l!ter on to sell his !rd
"#e! 4hether the contr!cts o& s!le involvin0 the 1? !rcels o& l!nd !re v!lid" $el%! The three contr!cts o& s!le !re void the &irst to &or viol!tion o& !rticle 1.57 o& the Civil Code !nd the third
ec!use Rold!n could !ss no title to #ilio Cru" The !nnul#ent c!rries ith is (Article 13-3 Civil Code) the oli0!tion o& Rold!n to return the 1? !rcels to0ether ith their &ruits !nd the dut o& the #inor, throu0h his 0u!rdi!n to re! +1.,?-- ith le0!l interest" u!rdi!nshi is ! trust o& the hi0hest order, !nd the trustee c!nnot e !lloed to h!ve !n induce#ent to ne0lect his !rd
irst 'ivision, uerrero (J): 5 concur Fact! +rudencio Alono !s !!rded the overn#ent th!t !rcel o& l!nd desi0n!ted !s @ot 21 o& Sudivision +l!n
+sd=32.65 o& !l!ct!s!n, @!#it!n, !sil!n Cit in !ccord!nce ith RA .??" The !!rd !s c!ncelled the o!rd o& @i8uid!tors on 2? J!nu!r 1765 on the 0round th!t, revious thereto, Alono !s roved to h!ve !lien!ted the l!nd to !nother, in viol!tion o& l!" >n 17?2, Alonot !s &urther stiul!ted th!t the vendorn Jul 17?2, +ichel &or the &irst ti#e since the e$ecution o& the deed o& s!le in his &!vor, c!used the h!rvest o& the &ruit o& the coconut trees in the l!nd" Alono &iled !n !ction &or the !nnul#ent o& ! %'eed o& S!le* e&ore the C> !sil!n Cit" ;n 5 J!nu!r 17?3, the loer court rendered its decision holdin0 th!t !lthou0h the !0ree#ent in 8uestion is deno#in!ted the !rties !s ! deed o& s!le o& &ruits o& the coconut trees &ound in the vendor
