Ayson-Simon v. Adamos
REITERATIONFacts
The Antecedents: Defendants Nicolas Adamos and Vicenta Feria purchased two lots from Juan Porciuncula. Subsequently, the successors-in-interest of Porciuncula filed a case to annul this sale. While that case was pending, Adamos and Feria sold the same two lots to Generosa Ayson Simon. Due to Adamos and Feria's failure to secure approved subdivision plans and deliver titles and possession to Simon, she filed a suit for specific performance. Procedural History: The Court of First Instance (CFI) of Quezon City ordered Adamos and Feria to have the lots relocated, resurveyed, and the subdivision plan approved, or to cause the subdivision and deliver titles and possession to Simon. However, a subsequent decision in another case (Civil Case No. 174) declared the sale of the lots by Porciuncula to Adamos and Feria null and void, making fulfillment of their obligation to Simon impossible. Consequently, Simon filed a new suit for rescission of the sale with damages before the CFI of Manila. The CFI of Manila rendered judgment in favor of Simon, ordering Adamos and Feria to return the purchase price with interest, plus attorney's fees and costs. Adamos and Feria appealed to the Court of Appeals, which certified the case to the Supreme Court due to being a pure question of law. The Appeal: Defendants-appellants argued that Simon's action for rescission had prescribed, contending that she had only four years from the date of sale to rescind. They also argued that her prior suit for specific performance constituted a waiver of her right to rescission, as these remedies are alternative, not cumulative.
Issue(s)
Whether the plaintiff-appellee, having initially filed an action for specific performance, can subsequently file an action for rescission of the sale. Whether the plaintiff-appellee's action for rescission had prescribed.
Ruling
The Supreme Court affirmed the judgment of the former Court of First Instance of Manila, holding that the plaintiff-appellee was entitled to rescission and damages. The Court ruled that the action for rescission had not prescribed and that the plaintiff-appellee was not barred from seeking rescission despite her prior action for specific performance.
Ratio Decidendi
On the issue of whether the plaintiff-appellee, having initially filed an action for specific performance, can subsequently file an action for rescission of the sale: The Court held that the rule that an injured party can only choose between fulfillment and rescission applies when the obligation is possible of fulfillment. In this case, fulfillment became impossible due to the declaration of nullity of the sale by Juan Porciuncula to the defendants-appellants in Civil Case No. 174. Citing Article 1191 of the Civil Code, the Court stated that if fulfillment becomes impossible, the injured party may seek rescission even after choosing fulfillment. Although the plaintiff-appellee had obtained a decision for specific performance, that portion of the decision requiring fulfillment became without force and effect because the defendants could not deliver the titles and possession of the lots. The claim for damages, however, remains valid in either case (fulfillment or rescission), thus, the plaintiff was not precluded from seeking rescission when fulfillment became impossible. On the issue of whether the plaintiff-appellee's action for rescission had prescribed: The Court ruled that the action had not prescribed. According to Article 1191 of the Civil Code, the cause of action to claim rescission arises when the fulfillment of the obligation becomes impossible. This impossibility was established when the Court of First Instance of Quezon City, in Civil Case No. 174, declared the sale of the land to the defendants by Juan Porciuncula null and void, and ordered the cancellation of the title issued to them. Since the lots sold to the plaintiff were part of this land, it became impossible for the defendants to deliver the titles and possession. The plaintiff had to wait for the finality of the decision in Civil Case No. 174, which became final and executory on May 3, 1967, as per the certification of the clerk of court. The action for rescission was filed on August 16, 1968, which is within the four-year prescriptive period from May 3, 1967. Therefore, the action had not expired.
Main Doctrine
In reciprocal obligations, the general rule is that the injured party may choose between fulfillment and rescission. However, if the fulfillment of the obligation becomes impossible, Article 1191 of the Civil Code allows the injured party to seek rescission even after having initially chosen fulfillment. The prescriptive period for filing an action for rescission begins to run from the date when the impossibility of fulfillment is established by a final and executory court judgment.