G.R. No. 182409 - FELIX PLAZO URBAN POOR SETTLERS COMMUNITY ASSOCIATION, INC., VS. ALFREDO LIPAT, SR. AND ALFREDO LIPAT, JR..

Ruling

accordingly dismissed the action for Specific Performance and Damages with Prayer for Preliminary Injunction filed by Felix Plazo Urban Poor Settlers Community Association, Inc. (petitioner) for lack of cause of action. The Facts On December 13, 1991, Lipat Sr., as represented by Lipat Jr., executed a Contract to Sell (CTS) in favor of the petitioner, as represented by its President, Manuel Tubao (Tubao), whereby the former agreed to sell to the latter two parcels of land in Naga City covered by Transfer Certificates of Title Nos. 12236 and 12237 (subject properties) for a consideration of P200.00 per square meter. [4] As stipulated in the CTS, the petitioner had 90 days to pay in full the purchase price of the subject properties; otherwise, the CTS shall automatically expire. The period, however, elapsed without payment of the full consideration by the petitioner. [5] According to the petitioner, the 90-day period provided in the CTS was subject to the condition that the subject properties be cleared of all claims from third persons considering that there were pending litigations involving the same. [6] Upon the expiry of the 90-day period, and despite the failure to clear the subject properties from the claims of third persons, the petitioner contributed financial assistance for the expenses of litigation involving the subject properties with the assurance that the CTS will still be enforced once the cases are settled. [7] In the meantime, the petitioner agreed to pay rental fees for their occupation of the subject properties from 1992 to 1996. [8] After the termination of the cases involving the subject properties, however, the respondents refused to enforce the CTS on the ground that the same had expired and averred that there was no agreement to extend its term. [9] Consequently, the petitioner filed a case for Specific Performance and Damages with Prayer for the Issuance of Preliminary Injunction against the respondents on June 10, 1997 before the Regional Trial Court (RTC) of Naga City. [10] For their defense, the respondents alleged that the CTS was not enforced due to the petitioner's failure to pay the P200.00 per sq m selling price before the expiration of its term. [11] As a result, the members of the petitioner were required to pay rental fees corresponding to the area they occupy. [12] Moreover, the respondents claimed that the so called "financial assistance" they received from the petitioner's members was in the nature of a loan and that it has nothing to do with the alleged extension of their CTS. [13] Considering that the CTS already expired, Lipat Jr. suggested an individual contract for each member of the petitioner. Only four members, however, were able to buy individual lots, namely, Consuelo Gomez, Edna Estioko, Gina Villar, and Pablo Calubad. [14] Also, Rosemarie Buenaventura, who is not a member of the petitioner, was able to buy two lots on the subject properties. Consequently, she filed an urgent Motion for Leave to Int