CASE DIGEST: Sanchez v. Rigos

 

NICOLAS SANCHEZ, plaintiff-appellee, vs. SEVERINA RIGOS, defendant appellant
G.R. No. L-25494               |              June 14, 1972

TOPIC: Formation of Sales

FACTS:

On April 3, 1961, plaintiff Nicolas Sanchez and defendant Severina Rigos executed an “Option to Purchase” instrument, whereby Mrs. Rigos “agreed, promised and committed to sell” to Sanchez a parcel of land in San Jose, Nueva Ecija, for P1,510.00, within 2 years from said date with the understanding that said option shall be deemed “terminated and elapse” if “Sanchez shall fail to exercise his right to buy the property” within the stipulated period. Sanchez made several tenders of payment within said period but were rejected by Mrs. Rigos.

Sanchez commenced an action for specific performance and damages against Mrs. Rigos on March 12, 1963.

The defendant alleged that the contract between the parties is a unilateral promise to sell, and the same being unsupported by any valuable consideration, by force of the New Civil Code, is null and void.

In his complaint plaintiff alleges that, by virtue of the option under consideration, “defendant agreed and committed to sell” and “the plaintiff agreed and committed to buy” the land described in the option. Hence, plaintiff maintains that the promise contained in the contract is “reciprocally demandable” pursuant to the first paragraph of Art. 1479.

The lower court rendered judgment for Sanchez, ordering Mrs. Rigos to accept the payment and to execute, in favor or Sanchez, the requisite deed of conveyance.

ISSUE:

Proper application of Art. 1479

RULING:

Although defendant had really “agreed, promised and committed” herself to sell the land to the plaintiff, it is not true that the latter had, in turn, “agreed and committed himself” to buy said property. The option did not impose upon plaintiff the obligation to purchase defendant’s property. It merely granted plaintiff an “option” to buy. And both parties so understood it, as indicated by the caption, “Option to Purchase,” given by them to said instrument. Under the provisions thereof, the defendant “agreed, promised and committed” herself to sell the land therein described to the plaintiff for P1,510.00, but there is nothing in the contract to indicate that her aforementioned agreement, promise and undertaking is supported by a consideration “distinct from the price” stipulated for the sale of the land.

Article 1354 applies to contracts in general, whereas the second paragraph of Article 1479 refers to “sales” in particular, and, more specifically, to “an accepted unilateral promise to buy or to sell.” In other words, Article 1479 is controlling in the case at bar.

In order that said unilateral promise may be “binding” upon the promisor, Article 1479 requires the concurrence of a condition, namely, that the promise be supported by a consideration distinct from the price.” Accordingly, the promisee cannot compel the promisor to comply with the promise, unless the former establishes the existence of said distinct consideration. In other words, the promise has the burden of proving such consideration. Plaintiff herein has not even alleged the existence thereof in his complaint.

“There is no question that under article 1479 of the new Civil Code ‘an option to sell,’ or ‘a promise to buy or to sell,’ as used in said article, to be valid must be ‘supported by a consideration distinct from the price.’ This is clearly inferred from the context of said article that a unilateral promise to buy or to sell, even if accepted, is only binding if supported by a consideration. In other words, ‘an accepted unilateral promise’ can only have a binding effect if supported by a consideration, which means that the option can still be withdrawn, even if accepted, if the same is not supported by any consideration.

“It is true that under article 1324 of the new Civil Code, the general rule regarding offer and acceptance is that, when the offerer gives to the offeree a certain period to accept, ‘the offer may be withdrawn at any time before acceptance’ except when the option is founded upon consideration, but this general rule must be interpreted as modified by the provision of article 1479 which applies to ‘a promise to buy and sell’ specifically. As already stated, this rule requires that a promise to sell to be valid must be supported by a consideration distinct from the price.

Since there may be no valid contract without a cause or consideration, the promisor is not bound by his promise and may, accordingly, withdraw it. Pending notice of its withdrawal, his accepted promise partakes, however, of the nature of an offer to sell which, if accepted, results in a perfected contract of sale.