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  • Legarda vs. Saldana

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    Richard Amor
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    1) Saldaña entered into two contracts with Legarda to purchase two lots for 1,500 per lot over 10 years at 10% annual interest. Saldaña paid for 8 years but stopped due to Legarda failing to make promised improvements. 2) Legarda rescinded the contracts, claiming payments were rentals and improvements were forfeited. The lower court agreed but the decision was reversed on appeal. 3) The Supreme Court ruled that cancellation was invalid as Saldaña had substantially paid for one lot in good faith. Under the Civil Code, Saldaña was entitled to one lot of his choice, with interest paid forfeited to Legarda.

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    1) Saldaña entered into two contracts with Legarda to purchase two lots for 1,500 per lot over 10 years at 10% annual interest. Saldaña paid for 8 years but stopped due to Legarda failing to make promised improvements. 2) Legarda rescinded the contracts, claiming payments were rentals and improvements were forfeited. The lower court agreed but the decision was reversed on appeal. 3) The Supreme Court ruled that cancellation was invalid as Saldaña had substantially paid for one lot in good faith. Under the Civil Code, Saldaña was entitled to one lot of his choice, with interest paid forfeited to Legarda.

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    © All Rights Reserved
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    477 views1 page

    Legarda vs. Saldana

    Uploaded by

    Richard Amor
    1) Saldaña entered into two contracts with Legarda to purchase two lots for 1,500 per lot over 10 years at 10% annual interest. Saldaña paid for 8 years but stopped due to Legarda failing to make promised improvements. 2) Legarda rescinded the contracts, claiming payments were rentals and improvements were forfeited. The lower court agreed but the decision was reversed on appeal. 3) The Supreme Court ruled that cancellation was invalid as Saldaña had substantially paid for one lot in good faith. Under the Civil Code, Saldaña was entitled to one lot of his choice, with interest paid forfeited to Legarda.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 1

    LEGARDA VS.

    SALDAÑA

    G.R. No. L-26578, January 28, 1974

    FACTS:

    Saldaña had entered into two written contracts with Legarda, a subdivision owner, whereby
    Legarda agreed to sell to him two of his lots for 1,500 per lot, payable over a span of 10 years
    on 120 monthly installments with 10% interest per annum. Saldaña paid for eight consecutive
    years but did not make any further payments due to Legarda’s failure to make the necessary
    improvement on the said lot which was promised by their representative, the said Mr.
    Cenon. Saldaña already paid a total of Php3,582.06. The statement of account shows that
    Saldaña paid Php1,682.28 of the principal and Php1,889.78 for the interest. It did not
    distinguish which of the two said lots was paid. Petitioner, then, rescinded the contract based
    on the stipulation of the contract that payments made by respondent shall be considered as
    rentals and any improvements made shall be forfeited in favor of the petitioner. The lower court
    ruled sustaining petitioner’s cancellation of contract. So respondent appealed and judgment
    was reversed in favor of the respondent ordering petitioners to deliver to plaintiff one of the two
    lots at the choice of the defendant and execute the deed of conveyance. Hence this petition.

    ISSUE:

    Was the cancellation of the sale of contract valid?

    RULING:

    No, even though it was stipulated that failure to complete the payment would result to the
    cancellation of the contract, it was still not valid. As clearly shown in the statement of account,
    Saldaña was able to pay one of the two said lots. Under Article 1234 of the New Civil Code, “if
    the obligation has been substantially performed in good faith, the obligor may recover as though
    there had been a strict and complete fulfillment, less damages suffered by the obligee”. Hence,
    under the authority of Article 1234 of the New Civil Code, Saladaña is entitled to one of the two
    lots of his choice and the interest paid shall be forfeited in favor of the petitioners.

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