LABSO
Case No. 33
Artates and Pojas vs. Urbi et al.
G.R. No. L-29421, January 30, 1971
FACTS: In September 1952, the proper land authorities issued in favor of herein
appellant Lino Artates and Manuela Pojas (spouses Artates) a homestead which is covered by
Patent No. V-12775 and duly registered in their names (OCT No. P-572). In October 1955,
Lino Artates inflicted injuries upon herein defendant Daniel Urbi who then filed Civil Case
No. 40 against the former.
The Justice of the Peace of Court of the CFI of Camilaniugan, Cagayan, awarded damages in
favor of Urbi in the amount of P1,476.35, so in June 1962, the Provincial Sheriff of Cagayan
made a public sale of the homestead to satisfy the said judgment. The spouses Artates
alleged that the sale of the homestead to satisfy Lino Artates’ indebtedness accrued in
October 1955 violated the provision of the Public Land Law exempting said property from
execution for any debt contracted within five years from the date of the issuance of the
patent, and that Urbi executed a deed of sale of the same parcel of land in June 1961 for the
sum of P2,676.35 to herein defendant Crisanto Soliven, who was a minor, to defraud them. In
March 1953, the CFI of Camilaniugan, Cagayan, upheld the execution made by the
Provincial Sheriff upon the homestead, and at declared null and void the sale of the land
between Urbi and Soliven.
ISSUE: Whether or not appellants spouses Artates possess absolute ownership over the
homestead which is covered by a patent?
HELD: The Supreme Court reversed the decision appealed from and declared the
spouses Artates to be entitled to the return and possession of the subject land without
prejudice to their continuing obligation to pay the judgment debt, and expenses connected
therewith. Considering the protective policy of the law, the Supreme Court reiterated that the
Philippines’ public land laws, being copied from American legislation, resort to American
precedents which held that the exemption from "debts contracted" by a homesteader include
freedom from money liabilities, from torts or crimes committed by him, such as from bigamy
or slander, breach of contract or other torts.
LABSO
Case No. 62
Bravo-Guerrero et al. vs. Bravo
G.R. No. 152658, July 29, 2005
FACTS: Spouses Mauricio & Simona Bravo are owners of 2 parcels of land at Makati
City, Metro Manila. The spouses had 3 children Roland, Cesar and Lily. Cesar died without
issue. Lily Bravo married DavidDiaz and had a named son David Jr., Roland had six
children: Lily Elizabeth Bravo-Guerrero, Edward, Roland Jr. Senia Bravo, Benjamin, and
half-sister, Ofelia.Simona executed a General Power of Attorney on 17 June 1966 appointing
Mauricio as her attorney-in-fact. Mauricio mortgaged the Properties to PNB for P10,000 and
DBP for P5,000. On 25 October 1970, Mauricio executed a Deed of Sale with Assumption of
Real Estate Mortgageto Roland, Ofelia & Elizabeth Bravo” (vendees) conditioned on the
payment of P1,000 and on the assumption of mortgage to PNB and DBP. This was notarized
by Atty. Guzman but was not annotated on the title. Neither was it presented to PNB and
DBP. The mortgage loans and the receipts were in Mauricio’s name even after his death on
20 November 1973. Simona died in 1977, Edward, represented by his wife, Fatima Bravo,
filed an action for the judicial partition claiming that he and the other grandchildren of the
spouses are co-owners. But petitioners refused to share with him the possession and rental
income of the properties. Edward later amended his complaint to include a prayer to annul
the Deed of Sale, which he claimed was merely simulated.
Regional trial court upheld the sale of the properties because (1) it did not prejudice the
compulsory heirs, as theProperties were conveyed for valuable consideration. (2) it was duly
notarized and was in existence for many years without question about its validity.
ISSUE: Whether or not the deed of sale with assumption of mortgage was valid and
enforceable
HELD: The Court of Appeals affirmed the decision of the trial court. The sale was
valid. Simulation of contract and gross inadequacy of price are distinct legal concepts, with
different effects. When the parties to an alleged contract do not really intend to be bound by
it, the contract is simulated and void because there is no real agreement between the parties.
A contract with inadequate consideration may nevertheless embody a true agreement between
the parties. A contract of sale is a consensual contract, it’s valid and binding upon the
meeting of minds and perfected by a mere consent. The concept of a simulated sale is thus
incompatible with inadequacy of price. When the parties agree on a price as the actual
consideration, the sale is not simulated despite the inadequacy of the price. Gross inadequacy
of price by itself will not result in a void contract. It does not even affect the validity of a
contract of sale, unless it signifies a defect in the consent or that the parties actually intended
a donation or some other contract. Inadequacy of cause will not invalidate a contract unless
there has been fraud, mistake or undue influence. In this case, respondents have not proved
any of the instance that would invalidate the deed of sale.
