The Supreme Court ruled that a buyer’s right to demand the execution of a Deed of Absolute Sale is not barred by prescription if the buyer made continuous written extrajudicial demands to the seller. The Court also held that the seller was estopped from denying the buyer’s full payment because the seller had previously acknowledged receiving late payments and assured the buyer that the deed would be executed. This decision protects the rights of buyers who have fully paid for their property but face resistance from sellers in transferring the title.

Can a Seller Deny Full Payment After Years of Accepting Payments? The Mesina vs. Garcia Case

This case revolves around a contract to sell a parcel of land between Atty. Honorio Valisno Garcia and Felicisima Mesina. After the death of Atty. Garcia, his wife, Gloria C. Garcia (respondent), claimed that she had fully paid for the property but the Mesinas (petitioners) refused to issue the Deed of Absolute Sale. The Mesinas argued that the respondent’s cause of action had already prescribed and that they were not estopped from denying full payment.

The central legal question is whether the respondent’s action for specific performance was barred by the statute of limitations. Actions based on a written contract have a prescriptive period of ten years from the accrual of the right of action. The Civil Code specifies in Article 1155 that the prescriptive period is interrupted by the filing of a court action, written extrajudicial demand by creditors, or a written acknowledgment of the debt by the debtor. In this case, the respondent argued that her series of written demands interrupted the prescriptive period.

The petitioners countered that Article 1155 only applies to demands made by creditors, not debtors. However, the Court disagreed with this interpretation. The Court emphasized that once the respondent fully paid the purchase price, she was no longer a debtor but rather a creditor entitled to demand the execution of the Deed of Absolute Sale. The obligation shifted from the respondent paying to the petitioners executing the deed, placing the respondent in the position of a creditor.

The Court found that the respondent had made numerous written demands, starting as early as 1986, urging the petitioners to execute the Deed of Absolute Sale. These demands were seen as continuous efforts to enforce her right under the contract. It’s a longstanding principle in contract law that consistent assertion of one’s rights demonstrates a clear intention to enforce those rights. This ultimately serves to interrupt any potential prescriptive period.

Beyond the issue of prescription, the Court also addressed the issue of estoppel. Estoppel is a legal principle that prevents a person from denying or asserting anything to the contrary of that which has been established as the truth. The Court agreed with the Court of Appeals’ finding that the petitioners were estopped from denying the full payment by the respondent. Evidence showed that the petitioners, through their authorized collection agent, accepted late payments and even prepared the Deed of Sale for their signature.

The Supreme Court cited specific instances where the petitioners acknowledged receiving payments and assuring the respondent of the deed’s execution. The petitioners’ own statements in previous legal filings contradicted their current claim that they never accepted the late payments or considered them as full payment. Such contradictory statements undermined their position. The Court pointed out that a party cannot perform affirmative acts that lead another to act to their detriment and then later refute those acts.

The Court underscored the importance of upholding contractual obligations and preventing parties from unjustly enriching themselves at the expense of others. By affirming the lower courts’ decisions, the Supreme Court ensured that the respondent, who had fulfilled her end of the bargain by fully paying for the property, would receive what she was rightfully entitled to: the Deed of Absolute Sale.

FAQs

What was the key issue in this case?	The key issue was whether the respondent’s action to compel the execution of a Deed of Absolute Sale had prescribed and whether the petitioners were estopped from denying full payment.
What is the prescriptive period for actions based on a written contract?	The prescriptive period for actions based on a written contract is ten years from the time the right of action accrues.
What interrupts the prescriptive period according to Article 1155 of the Civil Code?	Article 1155 states that the prescriptive period is interrupted by the filing of a court action, written extrajudicial demand by creditors, or written acknowledgment of the debt by the debtor.
Were the respondent’s written demands considered sufficient to interrupt the prescriptive period?	Yes, the Court held that the respondent’s series of written extrajudicial demands for the execution of the Deed of Absolute Sale interrupted the running of the 10-year prescriptive period.
What is the principle of estoppel?	Estoppel prevents a person from denying or asserting anything to the contrary of that which has been established as the truth, especially when another person has relied on their actions to their detriment.
How did the principle of estoppel apply in this case?	The petitioners were estopped from denying the respondent’s full payment because they had previously accepted late payments, assured her of the deed’s execution, and made sworn statements acknowledging these facts in prior legal proceedings.
What evidence did the respondent present to prove full payment?	The respondent presented receipts of payment, an Affidavit of Adverse Claim, and a series of demand letters sent to the petitioners, which were all considered as proofs of full payment.
What was the final ruling of the Supreme Court?	The Supreme Court denied the petition and affirmed the decision of the Court of Appeals, which upheld the decision of the Regional Trial Court, ordering the petitioners to issue the Deed of Absolute Sale in favor of the respondent.

This case serves as a reminder of the importance of honoring contractual obligations and the legal consequences of making representations that induce reliance. Parties should ensure transparency and consistency in their dealings to avoid potential claims of estoppel and uphold the sanctity of contracts.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: MELANIE M. MESINA, DANILO M. MESINA, AND SIMEON M. MESINA v. GLORIA C. GARCIA, G.R. NO. 168035, November 30, 2006