Buenavista Properties v. Mariño
REITERATIONFacts
The Antecedents: Spouses Buencamino and Spouses San Juan entered into a Joint Venture Agreement (JVA) with La Savoie Development Corporation for the development and sale of lots in Buenavista Park Subdivision. The landowners later sold their property to Josephine Conde, who assigned her interests to Buenavista Properties, Inc. (BPI). An Addendum extended the development period to 1997. BPI, through Conde, requested La Savoie to stop selling lots until prices were agreed upon and development was sufficient, threatening to invoke the termination clause of the JVA. Respondent Ramon G. Mariño entered into a Contract to Sell with La Savoie for a lot in the subdivision on July 18, 1997. Mariño completed payment on September 19, 2001. BPI filed a complaint against La Savoie for termination of the JVA and recovery of properties on February 28, 1998, and a writ of preliminary injunction was issued on August 11, 1998, enjoining La Savoie from selling remaining lots. BPI refused to sign the Deed of Absolute Sale and deliver the title to Mariño, claiming La Savoie exceeded its authority and sold lots at unilaterally fixed prices without BPI's approval. Procedural History: The Regional Trial Court (RTC) terminated the JVA and ordered La Savoie to deliver possession of the subdivision to BPI. Mariño filed an action for specific performance against BPI before the Housing and Land Use Regulatory Board (HLURB). The HLURB ordered BPI to deliver the title to Mariño and pay damages and attorney's fees. The Court of Appeals (CA) affirmed the RTC's decision in the JVA rescission case. The Supreme Court denied La Savoie's appeal via a minute resolution. The HLURB Commissioners affirmed the HLURB-Legal Services Group's decision. The Office of the President (OP) denied BPI's appeal and subsequent motion for reconsideration. The CA affirmed the OP's decision, ruling that La Savoie's sale to Mariño was not ultra vires, BPI was solidarily liable, Mariño was not aware of BPI's letters, no case was filed by BPI to prevent the sale at the time of the contract, Mariño was entitled to the title, La Savoie was not an indispensable party, and the denial of La Savoie's petition by the Supreme Court was in a minute resolution and not a binding precedent. BPI filed a petition for review on certiorari before the Supreme Court, which was denied. BPI's first motion for reconsideration was also denied with finality. BPI filed a second motion for reconsideration with leave of court, which the Supreme Court noted without action, deeming it a prohibited second motion for reconsideration. The Petition: BPI argued that La Savoie's authority to sell was limited to engaging brokers and was withdrawn before the sale to Mariño. They contended that the contract did not bind them as they were not parties to it, thus Mariño had no cause of action against them. BPI also argued that La Savoie and its President were indispensable parties, rendering the HLURB decision void. They claimed Mariño was a buyer in bad faith and that the duty to deliver title could not be imposed on a non-party. BPI also pointed to a previous CA decision in favor of BPI with similar facts.
Issue(s)
Whether the June 1, 2016 Motion for Reconsideration With Leave of Court filed by Buenavista Properties, Inc. (BPI) is a prohibited second motion for reconsideration. Whether La Savoie Development Corporation had the authority to sell the subdivision lot to Ramon G. Mariño under the Joint Venture Agreement (JVA) and its Addendum. Whether BPI's alleged withdrawal of La Savoie's authority to sell was effective prior to the execution of the Contract to Sell with Mariño. Whether there was privity of contract between BPI and Mariño. Whether La Savoie and its President were indispensable parties to the case. Whether Mariño was a buyer in bad faith. Whether the duty to deliver the title to the buyer under Section 25 of Presidential Decree No. 957 can be imposed on a non-party to a contract.
Ruling
The Supreme Court noted without action BPI's June 1, 2016 Motion for Reconsideration With Leave of Court, deeming it a prohibited second motion for reconsideration. The Court reiterated that a decision that has acquired finality becomes immutable and unalterable. The Court found no reason to entertain the second motion for reconsideration as it did not fall under the exception of being in the higher interest of justice. The Court also affirmed its previous denial of BPI's petition for review on certiorari and its first motion for reconsideration, finding that the issues raised by BPI had been duly considered and uniformly ruled against them by the lower tribunals.
Ratio Decidendi
On the prohibition against a second motion for reconsideration: The Court held that BPI's June 1, 2016 Motion for Reconsideration With Leave of Court was a prohibited second motion for reconsideration. It cited Section 2 of Rule 52 and Section 3 of Rule 15 of the Rules of Court and Internal Rules of the Supreme Court, respectively, which state that no second motion for reconsideration shall be entertained. The Court clarified that an exception in the "higher interest of justice" requires the assailed decision to be not only legally erroneous but also patently unjust and potentially capable of causing unwarranted and irremediable injury or damage. The Court found that the present case did not present such a situation. Furthermore, the Court emphasized that a decision that has acquired finality becomes immutable and unalterable, and may no longer be modified in any respect, except for its execution. The resolution denying BPI's first motion for reconsideration with finality explicitly stated that no further pleadings or motions would be entertained. On La Savoie's authority to sell: The Court found that the JVA clearly empowered La Savoie to sell the Buenavista Park Subdivision lots. Clauses 2.2, 3.1, and 6.2 of the JVA granted La Savoie the power to exercise general management over the project, including marketing and sales, to act as BPI's attorney-in-fact with full power and authority to take possession of the realty, and to sell the lots within the specified period. Clause 7.1 further authorized La Savoie to receive payments from buyers in its own name. Therefore, contrary to BPI's claim, La Savoie was indeed empowered to sell the lot to Mariño. On the withdrawal of authority to sell: The Court determined that the Contract to Sell between La Savoie and Mariño was executed on July 18, 1997, which was before BPI categorically withdrew La Savoie's authority to sell. BPI's option to cancel the JVA became clear only on February 28, 1998, when it filed the JVA rescission case. While BPI sent several letters prior to this date requesting La Savoie to suspend or stop selling lots, these letters did not constitute a categorical termination of the JVA or a withdrawal of La Savoie's authority to sell. In fact, BPI's August 15, 1997 letter indicated it was still about to invoke the termination clause. Thus, at the time of the sale to Mariño, La Savoie retained full authority under the JVA to enter into the Contract to Sell. On privity of contract: The Court implicitly addressed this by affirming the CA's ruling that BPI is solidarily liable even if La Savoie exceeded its authority, by virtue of Article 1911 of the Civil Code. The CA also noted that BPI's withdrawal of authority could not bind Mariño as he appeared to be unaware of BPI's letters. The Court's denial of BPI's petition suggests agreement with the CA's findings that BPI, as the assignee of the property and the party in possession of the title, had the obligation to execute the Deed and deliver the title to Mariño. On indispensable parties: The Court agreed with the CA that La Savoie was not an indispensable party. The CA reasoned that since La Savoie had already transmitted the Deed of Absolute Sale to BPI, and the title was in BPI's name and possession, BPI was the indispensable party obligated to execute the Deed and deliver the title to Mariño. The CA concluded that BPI, not La Savoie and its President, was the indispensable party. On buyer in bad faith: The Court did not directly address this issue in its resolution, but the CA's ruling, which was implicitly affirmed, suggested that Mariño was not aware of BPI's letters and had completed payment, implying good faith on his part. The CA pointed out that Mariño does not appear to have been aware of BPI's letters to La Savoie asking the latter to stop the sale of the lots until they have agreed on the price. On the duty to deliver title to a non-party: The Court affirmed the HLURB's order for BPI to deliver the title to Mariño, citing Section 25 of PD No. 957. This implies that the duty to deliver the title can be imposed on BPI, even if BPI was not a direct party to the Contract to Sell with Mariño, because BPI was the entity holding the title and had the obligation to ensure the buyer received it upon full payment, as per the governing law for subdivision and condominium buyers.
Main Doctrine
A second motion for reconsideration is generally prohibited and will not be entertained unless it is in the higher interest of justice, which requires the assailed decision to be not only legally erroneous but also patently unjust and potentially capable of causing unwarranted and irremediable injury or damage. Furthermore, a decision that has acquired finality becomes immutable and unalterable.