G.R. No. 174966 - DEVELOPMENT BANK OF THE PHILIPPINES, vs. ROMEO TESTON, represented by his Attorney-in-Fact, CONRADO O. COLLARINA.D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE , the Decision of the Adjudicator a quo dated March 30, 1998 is AFFIRMED in toto. [7] (Emphasis in the original; underscoring supplied) Respondent assailed the DARAB decision via Petition for Review [8] before the Court of Appeals. By Decision [9] of January 11, 2006, the appellate court modified the trial courts decision by ordering DBP to return to respondent the P1,000,000 which [respondent] paid as downpayment, following the law on rescission. We cannot write finis in this case without ordering respondent DBP to return the payment made by herein petitioner in view of the rescission of the subject Deed of Conditional Sale . Under Article 1385 of the Civil Code, rescission creates the obligation to return the things which were the object of the contract, together with their fruits, and the price with its interests x x x. Hence, equity demands that the amount paid by the petitioner be returned to him. WHEREFORE , the assailed Decision dated February 23, 2004 is MODIFIED . With DBPs rescission of the contract it executed with petitioner, DBP is consequently directed to return petitioner the P1,000,000.00 which the latter paid as down payment for the intended purchase of the subject parcels of land, plus 12% annual interest thereon. The decision stands in all other respects. [10] (Italics and underscoring in the original.) By a Partial Motion for Reconsideration, [11] DBP questioned the order to return the P1,000,000 which respondent had allegedly given as down payment. Respondent, upon the other hand, filed a Motion to Fix Date When [the P1,000,000 Would] Earn Interest. [12] The Court of Appeals denied DBPs Motion for Partial Reconsideration. It granted respondents motion and accordingly held that interest on the P1,000,000 would accrue upon the finality of the judgment until full payment. [13] Hence, DBPs present Petition for Review on Certiorari [14] faulting the appellate court to have erred . . . WHEN IT ORDERED DBP TO RETURN THE ALLEGED DOWNPAYMENT MADE BY PETITIONER IN THE ALLEGED AMOUNT OF P1,000,000.00 AS THIS WAS NEITHER RAISED AS AN ISSUE IN THE TRIAL COURT NOR IN PRIVATE RESPONDENTS AMENDED PETITION FOR REVIEW IN THE COURT OF APPEALS. IT WAS NOT EVEN ALLEGED AS ONE OF PRIVATE RESPONDENTS ASSIGNED ERRORS. . . . IN ORDERING THE REFUND OF P1,000,000.00 BASED MERELY ON DOCUMENTS SUBMITTED IN THE APPELLATE COURT BUT WERE NOT PROPERLY PRESENTED AND OFFERED AS EVIDENCE IN THE DARAB PROCEEDINGS. HENCE, THERE IS CERTAINLY NO BASIS FOR THE COURT TO ORDER DBP TO RETURN THE AMOUNT OF P1,000,000.00 TO PRIVATE RESPONDENT. GRANTING ARGUENDO THAT THE ISSUE ON DEPOSIT MAY PROPERLY BE CONSIDERED, [IN] FAIL[ING] TO CONSIDER THAT UNDER THE LAW BETWEEN THE PARTIES, PETITIONER DBP IS UNDER NO OBLIGATION TO RETURN THE ALLEGED DEPOSIT OF P1,000,000.00 WHICH PRIVATE RESPONDENT ALLEGEDLY PAID AS DOWNPAYMENT, BECAUSE THE DEED OF CONDITIONAL SALE DATED JULY 15, 1987 EXPRESSLY PROVIDES THAT IN CASE OF RESCISSION OF CONTRACT, ALL SUMS OF M