503 Phil. 121
GARCIA, J.:
The material facts, undisputed by the parties, may be briefly stated, as follows:
- Decision dated May 23, 2000,[1] setting aside an earlier decision of the Office of the President in a complaint for breach of obligation filed by the herein respondents against the petitioner in connection with the sale of a subdivision lot; and
- Resolution dated September 12, 2000,[2] denying petitioner's motion for reconsideration.
In the same decision, the Arbiter dismissed the complaint against petitioner's co-defendant, Purita Soliven.
- to perform its obligation to provide subdivision facilities in the subject premises and to rid the premises of squatters. In the alternative, at the option of complainants xxx to replace subject lot with a lot of similar size and with available facilities, located in the subject subdivision.
- to pay complainants P20,000.00 as and by way of attorney's fees.
WHEREFORE, premises considered, the first paragraph of the decision appealed from is hereby AFFIRMED with the modification that in case Solid Homes, Inc. fails to replace subject lot with a lot of similar size and with available facilities located in the subdivision, because it had already sold or transferred all of its properties in the subdivision, it shall pay spouses Ancheta Tan and Corazon Tan the total amount received from them as purchase price, with legal rate of interest from February 1985, until fully paid. Save for this modification, the decision appealed from is hereby AFFIRMED.On June 25, 1999, respondents filed a motion for partial reconsideration of the aforementioned decision, praying for the deletion of that portion thereof giving petitioner the option of merely paying them the purchase price with interest in the event petitioner "fails to replace subject lot with a lot of similar size and with available facilities located in the subdivision, because it had already sold or transferred all of its properties in the subdivision." Respondents argued that it would be more in accord with equity and fair play if they will be paid the fair market value of the lot in question and not merely its purchase price, should there be no available lot with facilities in the area.
SO ORDERED (Italics, ours).
WHEREFORE, Premises Considered, the assailed Decision dated 03 June 1999 is hereby SET ASIDE and the Decision of the HLURB dated 16 April 1997 is hereby AFFIRMED subject to the modification that if there is no more available lot in Loyola Grand Villas to replace subject lot, Solid Homes, Inc. should pay the spouses Tan the current market value of their lot.This time, petitioner moved for reconsideration but its motion was denied by the same court in its resolution of September 12, 2000.[8]
SO ORDERED.
We DENY.
- XXX IN RULING THAT PRESCRIPTION HAS NOT SET-IN;
- XXX IN APPLYING THE PRINCIPLE ON EQUITY AS AGAINST POSITIVE LAW TO THE PREJUDICE OF HEREIN PETITIONER; AND
- XXX IN RULING THAT PETITIONER SHOULD PAY RESPONDENTS THE CURRENT MARKET VALUE OF THE LOT IN QUESTION.
Article 1144. The following actions must be brought within ten years from the time the right of action accrues:If not on a written contract, petitioner's obligation to introduce improvements on the area in question arises from law, more specifically P.D. 957, as amended by P.D. 1216, Section 31 of which pertinently reads:
(1) Upon a written contract;
(2) Upon an obligation created by law;
(3) Upon a judgment (Emphasis supplied).
SECTION 31. Roads, Alleys, Sidewalks and Open Spaces.—The owner as developer of a subdivision shall provide adequate roads, alleys and sidewalks. For subdivision projects one (1) hectare or more, the owner or developer shall reserve thirty percent (30%) of the gross area for open space.The next inquiry, then, is when the respondents' cause of action accrued. Our earlier ruling in Banco Filipino Savings and Mortgage Bank vs. CA[9] provides the answer:
Thus, the period of prescription of any action is reckoned only from the date the cause of action accrued. And a cause of action arises when that which should have been done is not done, or that which should not have been done is done. The period should not be made to retroact to the date of execution of the contract on January 15, 1975 as claimed by the petitioner for at that time, there would be no way for the respondents to know of the violation of their rights. The Court of Appeals therefore correctly found that respondents' cause of action accrued on October 30, 1978, the date they received the statement of account showing the increased rate of interest, for it was only from that moment that they discovered the petitioner's unilateral increase thereof. We quote with approval the pertinent portions of the Court of Appeals decision as follows:In law, a cause of action exists when the following requisites concur, to wit: (1) a right in favor of the plaintiff by whatever means and under whatever law it arises or is created; (2) an obligation on the part on the defendant to respect such right; and (3) an act or omission on the part of such defendant violative of the right of the plaintiff.[12]It is the legal possibility of bringing the action that determines the starting point for the computation of the period of prescription.[10] In fine, the ten-year prescriptive period is to be reckoned from the accrual of the Appellee's right of action, not necessarily on the very date of the execution of the contracts subject of the action[11] (Emphasis supplied)
The debtor, therefore, violates the obligation in point of time if there is mora or delay. Now, there is no mora or delay unless there is a demand. It is noteworthy that in the present case during all the period when the principal obligation was still subsisting, although there were late amortizations there was no demand made by the creditor, plaintiff-appellant for the payment of the penalty. Therefore up to the time of the letter of plaintiff-appellant there was no demand for the payment of the penalty, hence the debtor was not in mora in the payment of the penalty.Hence, absent any demand from the obligee, the obligor does not incur delay. And so long as the obligor does not incur in delay, he cannot be said to be guilty of some omission violative of the obligee's rights. Consequently, as long as the obligor is not guilty of some omission violative of the obligee's rights, the latter has no cause of action against the former. As a result, the prescriptive period within which the obligee may bring an action against the obligor does not commence to run until a demand is made.
Article 1385. 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; consequently, it can be carried out only when he who demands rescission can return whatever he may be obliged to restore.On surface, petitioner's argument appears infallible. However, a closer look at our laws and the reason and spirit behind their enactment, as well as established jurisprudence, negates petitioner's thesis.
A literal application of any part of a statute is to be rejected if it will operate unjustly, lead to absurd results, or contradict the evident meaning of the statute taken as a whole. Unlike the CA, we find that the literal application of the aforesaid sections of the Tax Code and its implementing regulations does not operate unjustly or contradict the evident meaning of the statute taken as a whole. Neither does it lead to absurd results. Indeed, our courts are not to give words meanings that would lead to absurd or unreasonable consequences. We have repeatedly held thus:Were we to follow the letter of Article 1385, we will in effect be paving the way to an absurd situation whereby subdivision developers who have reneged on their contractual and legal obligation to provide utility systems and facilities for the use of subdivision lot owners may themselves profit from their very own wrongs and shortcomings. In the curt language of the Court of Appeals, to which we are in full accord:xxx [Statutes should receive a sensible construction, such as will give effect to the legislative intention and so as to avoid an unjust or an absurd conclusion. (Emphasis supplied.)
Indeed, there would be unjust enrichment if respondents Solid Homes, Inc. & Purita Soliven are made to pay only the purchase price plus interest. It is definite that the value of the subject property already escalated after almost two decades from the time the petitioner paid for it. Equity and justice dictate that the injured party should be paid the market value of the lot, otherwise, respondents Solid Homes, Inc. & Purita Soliven would enrich themselves at the expense of herein lot owners when they sell the same lot at the present market value. Surely, such a situation should not be countenanced for to do so would be contrary to reason and therefore, unconscionable. Over time, courts have recognized with almost pedantic adherence that what is inconvenient or contrary to reason is not allowed in law.The foregoing scenario becomes even more intolerable when it is considered that P.D. 959 was issued precisely as a measure against subdivision owners, developers, operators and/or sellers who reneged on their obligation to provide the needed utility systems and facilities in their subdivisions. As expressed in one of the decree's whereas clauses:
WHEREAS, numerous reports reveal that many real estate subdivision owners, developers, operators and/or sellers have reneged on their representations and obligations to provide and maintain properly subdivision roads, drainage, sewerage, water systems, lighting systems, and other similar basic requirements, thus endangering the health and safety of home and lot buyers.WHEREFORE, the instant petition is DENIED and the assailed decision and resolution of the Court of Appeals AFFIRMED.