Digest Cases Oblicon

OBLICON: EXTINGUISHMENT OF OBLIGATIONs  Payment or Performance 1. Montecillo vs. Reynes FACTS: Respondents Ignacia Reynes and Spouses Abucay filed on June 20, 1984 a complaint for Declaration of Nullity and Quieting of Title against petitioner Rido Montecillo. Reynes asserted that she is the owner of a lot situated in Mabolo, Cebu City containing an area of 448 square meters. In 1981, Reynes sold 185 square meters of the Mabolo Lot to the Abucay Spouses who built a residential house on the lot they bought. Reynes signed a Deed of Sale of the whole 448 square meters Mabolo Lot in favor of Montecillo on March 1, 1984. Montecillo promised to pay the agreed P47,000.00 purchase price within one month from the signing of the Deed of Sale. Montecillo failed to pay the purchase price after the lapse of the one-month period, prompting Reynes to demand from Montecillo the return of the Deed of Sale. Since Montecillo refused to return the Deed of Sale, Reynes executed a document unilaterally revoking the sale and gave a copy of the document to Montecillo. Subsequently, on May 23, 1984 Reynes signed a Deed of Sale transferring to the Abucay Spouses the entire Mabolo Lot, at the same time confirming the previous sale in 1981 of a 185-square meter portion of the lot. Respondents alleged that on June 18, 1984 they received information that the Register of Deeds of Cebu City issued Certificate of Title No. 90805 in the name of Montecillo for the Mabolo Lot. Respondents argued that “for lack of consideration there was no meeting of the minds” between Reynes and Montecillo. Thus, the trial court should declare null and void ab initio Montecillo’s Deed of Sale, and order the cancellation of Certificate of Title No. 90805 in the name of Montecillo. In his answer, Montecillo claimed he was a buyer in good faith and had actually paid the P47,000.00 consideration stated in his Deed of Sale. He, however, admitted he still owed Reynes a balance of P10,000.00. He also alleged that he paid