Spouses Raet v. Court of Appeals
REITERATIONFacts
The Antecedents: Petitioners (Spouses Raet and Spouses Mitra) negotiated with Amparo Gatus to buy rights to subdivision units developed by Phil-Ville Development and Housing Corporation (PVDHC). Petitioners paid Gatus amounts totaling P40,000.00 and P35,000.00, respectively. Subsequently, petitioners applied directly with PVDHC for the units, using GSIS policies of accommodation parties as they were not GSIS members. They paid P32,653.00 and P27,000.00 to PVDHC, with the understanding these would be credited to the purchase price. Petitioners were allowed to occupy the units. However, their GSIS loan applications were disapproved, and PVDHC advised them to find other financing. Procedural History: A criminal case for estafa against Gatus, filed by petitioner Elvira Raet, was dismissed by the Regional Trial Court (RTC), which found Gatus did not misrepresent herself as PVDHC's agent. PVDHC sent demand letters for petitioners to vacate, and upon refusal, filed ejectment cases. The Municipal Trial Court (MTC), RTC, and Court of Appeals (CA) ordered petitioners to vacate. Petitioners' appeal to the Supreme Court was dismissed. Petitioners had previously filed complaints with the RTC for recovery of supplemental costs paid to PVDHC, but the Raets' complaint was dismissed for lack of jurisdiction (HLURB exclusive competence), and the Mitras' complaint was withdrawn. Petitioners then filed a complaint for specific performance and damages with the HLURB against Gatus and PVDHC. The HLURB Arbiter ruled in favor of petitioners, finding Gatus an agent of PVDHC and ordering Gatus to remit payments or refund petitioners, and directing PVDHC to allow petitioners time to secure financing or pay the balance. The HLURB Board of Commissioners reversed this, citing the MTC's ejectment ruling as determinative. The Office of the President (OP) sustained the HLURB Arbiter, holding HLURB's jurisdiction exclusive and the ejectment ruling not conclusive on perfected contracts. PVDHC appealed to the CA, which set aside the OP's decision and dismissed petitioners' action, without prejudice to proceeding against Gatus. Petitioners' motion for reconsideration was denied. The Petition: Petitioners filed a petition for review on certiorari, assailing the CA's conclusion that the ejectment suit judgment barred their specific performance action and that no perfected contracts of sale existed.
Issue(s)
Whether the decision in the unlawful detainer case serves as a bar to the action for specific performance. Whether there were perfected contracts of purchase and sale between the petitioners and the private respondent with respect to the disputed housing units. Whether the Court of Appeals erred in not considering the findings of fact of the Office of the President as final and binding.
Ruling
The petition is dismissed. The Court of Appeals correctly ruled that no perfected contracts of sale existed between the parties.
Ratio Decidendi
On the issue of the ejectment suit as a bar to the specific performance action: The Court held that the contention has merit. The decision in an ejectment suit is conclusive only with respect to the possession de facto of the premises. It does not settle the principal question involved in the present case, namely, whether there were perfected contracts of sale between petitioners and private respondent PVDHC involving the units in question. This latter question falls under the exclusive jurisdiction of the HLURB, as provided by law. Therefore, the ruling in the ejectment case cannot be a bar to the action for specific performance before the HLURB. On the existence of perfected contracts of sale: The Court agreed with the Court of Appeals that the parties had not reached any agreement with regard to the sale of the units. Firstly, the records did not show the total costs of the units and the payment schemes, and the figures petitioners relied on were mere estimates given by Gatus. Secondly, Gatus was not an agent of PVDHC, and the Civil Code requires written authorization for an agent to sell land. Petitioners knew Gatus was negotiating in her own behalf. Thirdly, PVDHC had no knowledge of the estimated figures Gatus provided, thus it could not have ratified them, and PVDHC's agreements were contingent on GSIS loan approval, which failed. Fourthly, there were no written contracts to evidence the alleged sales, which is unusual for transactions of such importance. The Court emphasized that without a perfected contract, there can be no specific performance. On the findings of the Office of the President: While courts generally accord great respect to the factual findings of administrative agencies, this rule does not apply when the evidence on record calls for a reversal or modification thereof. As the evidence on record pointed to factual conclusions opposite those reached by the Office of the President, the Court of Appeals correctly refused to give conclusive effect to such administrative findings. The Court found that the evidence supported the CA's conclusion that no perfected contract of sale existed.
Main Doctrine
The decision in an ejectment suit is conclusive only on the issue of possession and does not settle the principal question of whether a perfected contract of sale exists between a buyer and a developer, which falls under the exclusive jurisdiction of the Housing and Land Use Regulatory Board (HLURB).