Bunayog v. Chiong
REITERATIONFacts
The Antecedents: Plaintiff Demetrio Bunayog filed an action against defendant Sixto Chiong before the Court of First Instance of Misamis Occidental. Plaintiff sought to consolidate ownership over a property sold to him under a pacto de retro sale, alleging defendant's failure to repurchase within the agreed period, and prayed for damages and attorney's fees. Procedural History: Defendant admitted the pacto de retro sale and his failure to repurchase within the stipulated period. However, he denied violating any condition that would entitle plaintiff to damages. He moved for judgment on the pleadings regarding the consolidation of ownership but requested a hearing for the damages claim. Plaintiff opposed, arguing that the damages claim was controverted. The trial court rendered judgment consolidating ownership in favor of the plaintiff but denied damages and costs, deeming the damages claim untenable. The Appeal: Plaintiff interposed the present appeal, contending that the trial court erred in not declaring that the defendant violated the pacto de retro sale by failing to redeem the property and in not awarding damages as prayed for.
Issue(s)
Whether the failure of the seller in a pacto de retro sale to repurchase the property within the stipulated period constitutes a violation of the contract that warrants the award of damages to the buyer. Whether the trial court erred in not awarding damages to the plaintiff-appellant.
Ruling
The Supreme Court affirmed the decision of the trial court. It held that the failure of the defendant-appellee to redeem the property was not a violation of the contract of pacto de retro sale and therefore did not entitle the plaintiff-appellant to damages. The appeal was dismissed without pronouncement as to costs.
Ratio Decidendi
On Issue 1: The Court ruled that the failure of the defendant-appellee to repurchase the property within the stipulated period did not constitute a violation of the contract of pacto de retro sale. The Court explained that the option to repurchase is a right reserved to the seller, which he may waive if he so desires. Such failure to exercise this right cannot be considered an infringement of the contract, nor does it give rise to an award for damages, unless specific conditions for damages were stipulated and breached. The Court emphasized that the defendant admitted the sale and his failure to redeem, but denied violating any condition that would warrant damages. On Issue 2: Consequently, the trial court did not err in not awarding damages to the plaintiff-appellant. The Court found no merit in the appeal because the defendant did not violate any of the stipulated conditions of the contract that would entitle the plaintiff to damages. The plaintiff's claim for damages was deemed untenable based on the contract and the facts presented. The Court also noted that certain alleged facts showing bad faith on the part of the appellee, which were not mentioned in the brief, did not appear in the complaint and therefore could not be considered on appeal.
Main Doctrine
The Supreme Court affirmed the trial court's decision, holding that the failure of the defendant-appellee to repurchase the property sold under a pacto de retro sale within the agreed period did not constitute a violation of the contract. Consequently, the plaintiff-appellant was not entitled to damages, as the failure to redeem is merely a waiver of a right, not an infringement of the contract, unless specific conditions for damages were stipulated and breached. The Court also noted that allegations of bad faith not present in the complaint could not be considered on appeal.