A. ADDISON, plaintiff-appellant, vs. MARCIANA FELIX and BALBINO TIOCO, defendants-appellees.

G.R. No. L-12342            August 3, 1918

FACTS:

4 parcels of land as describe in a public instrument was subject of a contract of sale between the petitioner and the defendant. Defendant paid 3000 upon the execution of deeds and promised to pay 2000 on July 15, 1914 and another 5000 (30) days after the issuance of her certificate of title

The contract was stipulated as follows:

That the defendant is to pay P10 within ten years for trees in bearing and P5 for trees not in bearing with the condition that it will not exceed the amount of P85,000.

That the purchaser shall deliver 25% of the value of the products "from the moment she takes possession of them until the Torrens certificate of title be issued in her favor."

Further stipulated was that "within one year from the date of the certificate of title in favor of Marciana Felix, this latter may rescind the present contract of purchase and sale, in which case Marciana Felix shall be obliged to return to me, A. A. Addison, the net value of all the products of the four parcels sold, and I shall obliged to return to her, Marciana Felix, all the sums that she may have paid me, together with interest at the rate of 10 per cent per annum."

In 1915, Addison filed a suit to compel the defendant to pay him the P2000 with interest as in the accordance of the terms of the contract. However, in a form of special defense, Felix alleges that the petitioner failed to do his obligation of the contract by failing to deliver the parcels of land. That out of the 4 parcels of land only 2 of it where delivered and that 2/3 of the other half were in the possession of a third person. She then filed for a declaration of the rescission of the contract, whereby she prayed that petitioner return her P3000 plus interest and indemnity

Trial Court ruled in favor of defendants, on the grounds that the plaintiff failed to deliver the lands and in accordance to their stipulation that ". . . within one year from the date of the certificate of title in favor of Marciana Felix, this latter may rescind the present contract of purchase and sale . . . ."

Appellate Court disagreed, alleging that the right to elect to rescind the contract was subject to a condition, namely, the issuance of the title, which in this case has not yet been fulfilled.

ISSUE:

Whether or not delivery of a Public Instrument is equivalent to the delivery of the subject matter of the sale.

HELD:

NO

The Code imposes upon the vendor the obligation to deliver the thing sold. The thing is considered to be delivered when it is placed "in the hands and possession of the vendee." (Civ. Code, art. 1462.) It is true that the same article declares that the execution of a public instruments is equivalent to the delivery of the thing which is the object of the contract, but, in order that this symbolic delivery may produce the effect of tradition, it is necessary that the vendor shall have had such control over the thing sold that, at the moment of the sale, its material delivery could have been made. It is not enough to confer upon the purchaser the ownership and the right of possession. The thing sold must be placed in his control. When there is no impediment whatever to prevent the thing sold passing into the tenancy of the purchaser by the sole will of the vendor, symbolic delivery through the execution of a public instrument is sufficient. But if, notwithstanding the execution of the instrument, the purchaser cannot have the enjoyment and material tenancy of the thing and make use of it himself or through another in his name, because such tenancy and enjoyment are opposed by the interposition of another will, then fiction yields to reality — the delivery has not been effected.

The execution of a public instrument is sufficient for the purposes of the abandonment made by the vendor; but it is not always sufficient to permit of the apprehension of the thing by the purchaser.

It is evident, then, in the case at bar, that the mere execution of the instrument was not a fulfillment of the vendors' obligation to deliver the thing sold, and that from such non-fulfillment arises the purchaser's right to demand, as she has demanded, the rescission of the sale and the return of the price. (Civ. Code, arts. 1506 and 1124.)

Inasmuch as the rescission is made by virtue of the provisions of law and not by contractual agreement, it is not the conventional but the legal interest that is demandable.