TL;DR

The Supreme Court ruled that a buyer’s claim for specific performance of a sale agreement was time-barred because they waited too long to file the lawsuit. The ten-year prescriptive period for written contracts begins when the right of action accrues, which in this case was when the title was issued to the seller, not when the buyer belatedly attempted to pay the remaining balance. This decision underscores the importance of promptly enforcing contractual rights to avoid losing the ability to seek legal recourse.

A Tardy Tender: When a Decade-Long Wait Dooms a Land Deal

This case revolves around a property dispute that highlights the critical importance of timely legal action. Spouses Abelardo and Rosita Borbe sought to compel Violeta Calalo to finalize a land sale agreement made years prior. The central question before the Supreme Court was whether the Borbes’ action for specific performance had prescribed, thus barring them from enforcing the agreement. The appellate court reversed the lower court’s decision, finding that the action was filed beyond the ten-year prescriptive period. This ruling underscores the significance of understanding when a cause of action accrues and the potential consequences of delay.

In 1981, Rosita Lajarca-Borbe (petitioner) and Violeta Calalo (respondent) entered into a “Kasunduan” for the sale of a 400-square meter lot inherited by Calalo from her late husband. The agreement stipulated a down payment of P3,000.00 and a balance of P3,000.00 to be paid upon the issuance of a new Transfer Certificate of Title (TCT) in Calalo’s name. The down payment was made, and subsequent payments reduced the balance to P500.00. A year later, in 1982, TCT No. T-51153 was issued in Calalo’s name. However, it wasn’t until 1995, thirteen years later, that the Borbes presented a deed of sale for Calalo to sign, which she refused, demanding a higher price. Following unsuccessful attempts at settlement, the Borbes filed a complaint for specific performance in August 1995.

The trial court initially ruled in favor of the Borbes, ordering Calalo to execute the deed of sale upon payment of the remaining P500.00. However, the Court of Appeals reversed this decision, citing prescription under Article 1144(1) of the Civil Code. This article states that actions upon a written contract must be brought within ten years from the time the right of action accrues. The appellate court computed the prescriptive period from the issuance of the TCT in Calalo’s name on September 22, 1982. The Supreme Court agreed with the Court of Appeals, emphasizing the importance of understanding when a cause of action accrues for purposes of prescription.

Article 1144 of the Civil Code is central to this case. It states:

Article 1144. The following actions must be brought within ten years from the time the right of action accrues:

(1) Upon a written contract;

The Supreme Court, in citing Multi-Realty Development Corporation v. The Makati Tuscany Condominium Corporation, reiterated that a “right of action” is the right to commence and maintain an action. This right springs from the cause of action but does not accrue until all the facts that constitute the cause of action have occurred. In the context of the “Kasunduan,” the Borbes’ obligation to pay the balance was triggered upon the issuance of the TCT in Calalo’s name. From that moment, they had the right to demand the execution of the deed of sale. Their failure to act within ten years from this date resulted in the prescription of their action.

The Borbes argued that their cause of action accrued only in 1995 when they tendered the remaining balance, which Calalo refused. However, the Court rejected this argument, holding that the issuance of the TCT in 1982 served as constructive notice to the world, including the Borbes. This constructive notice effectively negated any claim that they were unaware of Calalo’s title and thus justified their delay. The Court’s ruling highlights the legal principle that registration of property serves as a warning to all those dealing with the property.

FAQs

In conclusion, this case serves as a reminder of the importance of diligently pursuing legal remedies within the prescribed periods. The failure to act promptly can result in the loss of valuable rights, as demonstrated by the Borbes’ unsuccessful attempt to enforce the “Kasunduan” after a prolonged delay.

For inquiries regarding the application of this ruling to specific circumstances, please contact Atty. Gabriel Ablola through gaboogle.com or via email at connect@gaboogle.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Spouses Abelardo Borbe and Rosita Lajarca-Borbe vs. Violeta Calalo, G.R. NO. 152572, October 05, 2007