Conejero vs. Court of Appeals

A co-owner's right of legal redemption is lost where the redemptioner fails to make a valid tender of the entire redemption price within the 30-day period from written notice of the sale. The furnishing of a copy of the deed of sale by the vendor to the co-owner is equivalent to the written notice required by Article 1623, and the redemptioner must seasonably tender the full repurchase price in legal tender or validly consign it in court; a mere offer of a check for part of the price with a promise to pay the balance from a future bank loan does not constitute a valid exercise of the right.

Petitioners Paz Torres de Conejero and her husband Enrique Conejero sought to redeem an undivided half interest in a lot and building in Cebu City that Paz had inherited from her deceased parents together with her brother, Enrique Torres. The property was covered by Transfer Certificate of Title No. 197-A1230 (T-3827). The right of legal redemption (retracto de comuneros) is governed by Articles 1620 and 1623 of the Civil Code of the Philippines, which grant co-owners the right to redeem a share sold to a third party within 30 days from written notice of the sale.

Paz Torres and Enrique Torres were co-owners pro indiviso of a lot and building in Cebu City, covered by Transfer Certificate of Title No. 197-A1230 (T-3827), which both had inherited from their deceased parents. As of September 15, 1949, Enrique Torres sold his half interest to the Raffiñan spouses for P13,000, with the right to repurchase within one year. Subsequent advances by the vendees a retro increased their claims against Enrique Torres, and finally, on April 3, 1951 — six months after the expiration of the right to repurchase — Enrique executed a deed of absolute sale of the same half interest in the property in favor of the Raffiñans for P28,000.

This deed of absolute sale (Exhibit "3-A") had not been brought to the attention of Enrique's sister and co-owner, Paz Torres de Conejero, nor of her husband, until August 19, 1952, when Enrique Torres showed his brother-in-law, Enrique Conejero, a copy of the deed of absolute sale (Exhibit "C") of his share of the property in favor of the Raffiñans. Conejero forthwith went to the buyers, offering to redeem his brother-in-law's share, which offer he later raised to P29,000 and afterwards to P34,000. The evidence showed that the Conejeros had offered only P10,000 in check with which to redeem the property, with a promise to pay the balance by means of a loan which they would apply for and obtain from the bank.

Amicable settlement not having been attained, the Conejeros filed, on October 4, 1952, a complaint in the Court of First Instance of Cebu, seeking to be declared entitled to redeem the half interest of Enrique Torres. The Raffiñans made answer, claiming absolute title to the property in dispute and pleading that plaintiffs lost their right of redemption because they failed to exercise it within the statutory period. The court of first instance found the deed of sale to be an equitable mortgage and declared the plaintiffs Conejero entitled to redeem Enrique's half interest for P34,000. Upon appeal by the defendants, the Court of Appeals reversed the decision of the court of first instance, found that the deed in favor of the Raffiñans was a true sale, and dismissed the action.

• Written Notice Requirement: Petitioners argued that no written notice of the sale to the Raffiñans having been given by Enrique Torres to his sister and co-owner, Paz T. de Conejero, the latter's right to exercise legal redemption had not expired; in fact, it had not even started to run.
• Tender of Redemption Price: Petitioners argued that in legal redemption no tender of the redemption price is required, mere demand to allow redemption being sufficient to preserve the redemptioner's right.
• Reasonable Price Under Article 1620: Petitioners argued that tender of the price is excused because Article 1620 of the new Civil Code allows the redemptioner to pay only a reasonable price if the price of alienation is grossly excessive, and that the reasonableness of the price to be paid can only be determined by the courts.
• Reliance on Prior Jurisprudence: Petitioners cited De la Cruz vs. Marcelino, 84 Phil. 709, and Torio vs. Rosario, 93 Phil. 800, urging that under the provisions of the Civil Code of the Philippines, a valid tender of the redemption price is not required.
• Motion for Reconsideration: Petitioners argued that the Court erred in considering the 30-day period provided for in Article 1623 of the new Civil Code as a period of prescription, and that they exercised diligence in asserting their willingness to pay.

• Knowledge of Sale: Respondents claimed that as early as April 3, 1951, the date of the absolute sale of the property by Enrique Torres in favor of the Raffiñans, the appellees already knew of the sale, so that when the offer to redeem was made on August 19, 1952, the 30-day period provided by law had already lapsed.
• Invalid Offer to Redeem: Respondents argued that the offer to redeem was not valid and effective because it was not accompanied by an actual tender of an acceptable redemption price, the appellees having offered only P10,000 in check with a promise to pay the balance by means of a future bank loan.
• Written Notice Given: Respondents claimed that a written notice of the sale had been sent to the appellees, although the Court of Appeals conceded that the evidence did not sufficiently show that a written notice was in fact given.

• Written Notice: Whether the furnishing of a copy of the deed of sale by the vendor to the co-owner constitutes the written notice required by Article 1623 of the Civil Code, thereby starting the 30-day period for legal redemption.
• Tender of Redemption Price: Whether a valid tender of the full redemption price is required for the valid exercise of the right of legal redemption, and whether the petitioners' offer of P10,000 in check with a promise to pay the balance from a future bank loan constituted a valid tender.

• Written Notice: Yes. The furnishing of a copy of the deed of sale by the vendor to the co-owner is equivalent to the giving of written notice required by Article 1623 of the Civil Code, and the 30-day period for legal redemption began to run from August 19, 1952, when the copy was shown to Enrique Conejero.
• Tender of Redemption Price: No. The petitioners failed to make a valid tender of the entire redemption price within the 30-day period; a mere offer of a check for P10,000, which was not even legal tender, in lieu of the P28,000 price recited in the deed of sale, did not constitute a valid exercise of the right of redemption.

• Written Notice: The Court agreed with petitioners that written notice is indispensable and that, in view of the terms of Article 1623 of the Philippine Civil Code, mere knowledge of the sale acquired in some other manner by the redemptioner does not satisfy the statute. The written notice was exacted by the Code to remove all uncertainty as to the sale, its terms and its validity, and to quiet any doubts that the alienation is not definitive. The statute not having provided for any alternative, the method of notification prescribed remains exclusive. However, Article 1623 does not prescribe any particular form of notice, nor any distinctive method for notifying the redemptioner. So long as the latter is informed in writing of the sale and the particulars thereof, the 30 days for redemption start running. In this case, the redemptioners admitted that on August 19, 1952, the co-owner-vendor, Enrique Torres, showed and gave Enrique Conejero a copy of the 1951 deed of sale in favor of respondents Raffiñan. The furnishing of this copy was equivalent to the giving of written notice required by law: it came from the vendor and made available in writing the details and finality of the sale. As a necessary consequence, the 30-day period for the legal redemption by co-owner Paz Torres (retracto de comuneros) began to run from and after August 19, 1952, ending on September 18 of the same year.

• Tender of Redemption Price: The Court agreed with the Court of Appeals that the petitioners failed to make a valid tender of the price of the sale paid by the Raffiñans within the period fixed by law. Conejero merely offered a check for P10,000, which was not even legal tender and which the Raffiñans rejected, in lieu of the price of P28,000 recited by the deed of sale. The factual finding of the Court of Appeals to this effect is final and conclusive. Nor were the vendees obligated to accept Conejero's promise to pay the balance by means of a loan to be obtained in future from a bank. Bona fide redemption necessarily imports a seasonable and valid tender of the entire repurchase price, and this was not done. There is no cogent reason for requiring the vendee to accept payment by installments from a redemptioner, as it would ultimately result in an indefinite extension of the 30-day redemption period, when the purpose of the law in fixing a short and definite term is clearly to avoid prolonged and anti-economic uncertainty as to ownership of the thing sold.

The Court distinguished De la Cruz vs. Marcelino and Torio vs. Rosario, noting that those cases held that a judicial demand by action filed within the redemption period and accompanied by consignation in court of the redemption price could take the place of a personal tender under the Civil Code of 1889, because the nine-day redemption period allowed thereunder was so short as to render it impractical to require the redemptioner to seek out and offer the redemption price personally to the buyer. Under the present Civil Code, the urgency is greatly lessened by the prolongation of the redemption period to 30 days, and the petitioners herein neither filed suit within the 30-day redemption period nor made consignation of the price. While they received copy of the deed of sale on August 19, 1952, complaint was only filed on October 4, 1952.

The Court also rejected the argument that tender of the price is excused under Article 1620, holding that the right of a redemptioner to pay a reasonable price does not excuse him from the duty to make proper tender of the price that can be honestly deemed reasonable under the circumstances, without prejudice to final arbitration by the courts; nor does it authorize said redemptioner to demand that the vendee accept payment by installments. At any rate, the petitioners, in making their offer to redeem, never contested the reasonableness of the price recited in the deed of sale; in fact, they even offered more, and were willing to pay as much as P34,000.

The Court explained why the redemption price should either be fully offered in legal tender or else validly consigned in court: only by such means can the buyer become certain that the offer to redeem is one made seriously and in good faith. A buyer cannot be expected to entertain an offer of redemption without attendant evidence that the redemptioner can, and is willing to accomplish the repurchase immediately. A different rule would leave the buyer open to harassment by speculators or crackpots, as well as to unnecessary prolongation of the redemption period, contrary to the policy of the law. While consignation of the tendered price is not always necessary because legal redemption is not made to discharge a pre-existing debt, a valid tender is indispensable.

• Written notice requirement under Article 1623 — The 30-day period for legal redemption commences only upon written notice of the sale by the vendor to the co-owner; mere knowledge of the sale acquired through other means does not satisfy the statute. However, the furnishing of a copy of the deed of sale by the vendor to the co-owner constitutes the required written notice, as it comes from the vendor and makes available in writing the details and finality of the sale.

• Valid tender of redemption price — Bona fide redemption necessarily imports a seasonable and valid tender of the entire repurchase price. The redemptioner must either fully offer the redemption price in legal tender or validly consign it in court. A mere offer of a check for part of the price with a promise to pay the balance from a future bank loan does not constitute a valid exercise of the right of redemption.

• Strict compliance with legal requirements for redemption — The co-owner's right of legal redemption (retracto legal de comuneros) is a substantial right, but it is exceptional in nature, limited in its duration, and subject to strict compliance with the legal requirements. Redemption is not a matter of intent but is effectuated only by payment, or valid tender, of the price within the prescribed period.

• "The written notice was obviously exacted by the Code to remove all uncertainty as to the sale, its terms and its validity, and to quiet any doubts that the alienation is not definitive. The statute not having provided for any alternative, the method of notification prescribed remains exclusive." — This passage articulates the rationale for the written notice requirement under Article 1623 and establishes that mere knowledge of the sale is insufficient to start the redemption period.

• "The furnishing of this copy was equivalent to the giving of written notice required by law: it came from the vendor and made available in writing the details and finality of the sale. In fact, as argued for the respondents at bar, it served all the purposes of the written notice, in a more authentic manner than any other writing could have done." — This passage establishes the doctrine that a copy of the deed of sale furnished by the vendor to the co-owner constitutes the written notice required by Article 1623.

• "Bona fide redemption necessarily imports a seasonable and valid tender of the entire repurchase price, and this was not done. There is no cogent reason for requiring the vendee to accept payment by installments from a redemptioner, as it would ultimately result in an indefinite extension of the 30-day redemption period, when the purpose of the law in fixing a short and definite term is clearly to avoid prolonged and anti-economic uncertainty as to ownership of the thing sold." — This passage states the core ratio decidendi: a valid tender of the full redemption price is indispensable, and the vendee cannot be compelled to accept installment payments.

• "Only by such means can the buyer become certain that the offer to redeem is one made seriously and in good faith. A buyer can not be expected to entertain an offer of redemption without attendant evidence that the redemptioner can, and is willing to accomplish the repurchase immediately." — This passage explains the policy rationale for requiring full tender or consignation of the redemption price.

• De la Cruz vs. Marcelino, 84 Phil. 709 — Distinguished. The Court noted that this case held that a judicial demand by action filed within the redemption period and accompanied by consignation in court of the redemption price could take the place of a personal tender under the Civil Code of 1889, but the case is inapplicable because the petitioners herein neither filed suit within the 30-day redemption period nor made consignation of the price.
• Torio vs. Rosario, 93 Phil. 800 — Distinguished. Similar to De la Cruz, this case involved the shorter nine-day redemption period under the old Civil Code, which made personal tender impractical; the present case involves the 30-day period under the new Civil Code.
• Asturias Sugar Central vs. Cane Molasses Co., 60 Phil. 253 — Cited for the proposition that consignation of the tendered price is not always necessary because legal redemption is not made to discharge a pre-existing debt, but a valid tender is indispensable.
• Torrijos vs. Crisologo, G.R. No. L-1773, Sept. 29, 1962 — Cited in support of the policy that the purpose of the law in fixing a short and definite term for redemption is to avoid prolonged and anti-economic uncertainty as to ownership of the thing sold.
• Sempio vs. Del Rosario, 44 Phil. 1 — Referenced in the resolution denying reconsideration; the Court noted that while the doctrine invoked therein is correct law, it is totally inapplicable to the present case.

• Article 1623, Civil Code of the Philippines — Provides that the right of legal re-emption or redemption shall not be exercised except within thirty days from the notice in writing by the prospective vendor, or by the vendor, as the case may be; the deed of sale shall not be recorded in the Registry of Property unless accompanied by an affidavit of the vendor that he has given written notice thereof to all possible redemptioners; and the right of redemption of co-owners excludes that of adjoining owners. The Court applied this provision to hold that the copy of the deed of sale furnished to the redemptioner constituted the required written notice, and that the 30-day period ran from August 19, 1952.
• Article 1620, Civil Code of the Philippines — Allows the redemptioner to pay only a reasonable price if the price of alienation is grossly excessive. The Court held that this provision does not excuse the redemptioner from the duty to make proper tender of the price that can be honestly deemed reasonable under the circumstances, nor does it authorize the redemptioner to demand that the vendee accept payment by installments.

Bengzon, C.J., Bautista Angelo, Concepcion, Barrera, Dizon, Regala, Makalintal, Bengzon, J.P., Zaldivar and Sanchez, JJ., concurred in the decision of April 29, 1966. In the resolution of June 30, 1966, Concepcion, C.J., Barrera, Dizon, Regala, Makalintal, Bengzon, J.P., Zaldivar and Sanchez, JJ., concurred.

N/A — No dissenting opinions are noted in the case text.