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Afp Mutual Benefit Vs CA

This case involves a dispute over property titles between Solid Homes Inc, Investco Inc, and AFP Mutual Benefit Association Inc (AFPMBAI). Investco Inc entered into a contract to sell properties to Solid Homes Inc, but Solid Homes Inc failed to meet its obligations. Investco Inc then extra-judicially rescinded the contract. Investco Inc later entered into an absolute sale contract for the properties with AFPMBAI. The Supreme Court ruled that Investco Inc properly rescinded its contract with Solid Homes Inc due to Solid Homes Inc's failure to meet its obligations, and that the rescission did not require judicial action. The Court also clarified the difference between a contract to sell and

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171 views1 page

Afp Mutual Benefit Vs CA

This case involves a dispute over property titles between Solid Homes Inc, Investco Inc, and AFP Mutual Benefit Association Inc (AFPMBAI). Investco Inc entered into a contract to sell properties to Solid Homes Inc, but Solid Homes Inc failed to meet its obligations. Investco Inc then extra-judicially rescinded the contract. Investco Inc later entered into an absolute sale contract for the properties with AFPMBAI. The Supreme Court ruled that Investco Inc properly rescinded its contract with Solid Homes Inc due to Solid Homes Inc's failure to meet its obligations, and that the rescission did not require judicial action. The Court also clarified the difference between a contract to sell and

Uploaded by

carlo_tabangcura
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd

AFP MUTUAL BENEFIT VS CA

FACTS: This case involved Solid Homes Inc's MR of the SC's decision reversing the CA's decision
and ordering the RD to cancel the notice of lis pendens on the titles issued to AFPMBAI, declaring it
as buyer in good faith and for value. Investco Inc and Solid Homes Inc entered into a contract to sell.
During this time, the titles to the Quezon City and Marikina properties had not been transferred in the
name of Investco Inc as asignee of the owners, Angela Perez Staley and Antonio Perez. Thus,
Investco Inc merely agreed to sell and Solid Homes to buy the former's rights and interest in the
properties.

However, Solid Homes Inc. reneged or defaulted on its obligation. Thus, Investco Inc rescinded extra-
judicially such contract to sell. After such event, AFPMBAI and Investco Inc entered into a contract of
absolute sale, wherein the former paid in full, causing the transfer of titles in its name.

ISSUE: Whether or not Investco Inc properly rescinded its contract to sell and buy with Solid Homes
Inc

HELD: YES. Upon Solid Homes Inc's failure to comply with its obligation under the contract, there
was no need to judicially rescind the contract. Failure by one of the parties to abide by the conditions
in a contract to sell resulted in the rescission of the contract.

In Salazar v. Court of Appeals, we explained the distinction between a contract to sell and a contract
of sale:

In a contract of sale, the title to the property passes to the vendee upon the delivery of the thing sold;
in a contract to sell, ownership is, by agreement, reserved in the vendor and is not to pass to the
vendee until full payment of the purchase price. Otherwise stated, in a contract of sale, the vendor
loses ownership over the property and cannot recover it until and unless the contract is resolved or
rescinded; whereas in a contract to sell, title is retained by the vendor until full payment of the price.
In the latter contract, payment of the price is a positive suspensive condition, failure of which is not a
breach but an event that prevents the obligation of the vendor to convey title from becoming effective.

Upon Solid Homes, Inc.s failure to comply with its obligation thereunder, there was no need to
judicially rescind the contract to sell. Failure by one of the parties to abide by the conditions in a
contract to sell resulted in the rescission of the contract.

Unquestionably, Solid Homes, Inc. reneged on its obligation to pay the installments for the purchase
of the Quezon City and Marikina property of Investco, Inc. on the dates specified in the contract to sell

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