Padilla y Angeles vs. Dizon

A party who claims the benefit of a judgment must comply with any terms and conditions it imposes, and where a judgment is in the alternative granting the defendant an option, his election eliminates the alternative and is binding on both parties. The plaintiff's subsequent waiver of her rights under the judgment was invalid because it would prejudice the defendant's right, which had already been acquired through his election of the alternative remedy.

Isabel Padilla y Angeles, represented by her legal guardian Natividad Angeles Vda. de Padilla, purchased a parcel of land in Sampaloc, Manila from Luciano C. Dizon in 1948. The land was covered by Transfer Certificate of Title No. 12243 and was sold for P18,000, with the deed representing the area as 233.90 square meters. The old Civil Code, Article 4, paragraph 2, which governed the waiver of rights at the time, provided that rights granted by law may be waived provided such waiver is not contrary to public interest or public order, or prejudicial to a third person.

In 1948, Isabel Padilla y Angeles, represented by her legal guardian Natividad Angeles Vda. de Padilla, purchased from Luciano C. Dizon a parcel of land in Sampaloc, Manila, said to contain an area of 233.90 square meters, covered by Transfer Certificate of Title No. 12243, for P18,000. Upon a resurvey of the land, it was found to contain only 182.9 square meters. Plaintiff asked the vendor either to consider the sale void and return the purchase price of P18,000 and get back the land, or to refund her about P4,000 as the proportionate reduction of the purchase price due to the difference in area.

When the defendant failed to comply with her demand, plaintiff brought an action seeking, first, the return of the purchase price of P18,000 upon a judicial declaration of the sale as void because of fraud and misrepresentation as to the area of the lot, or, alternatively, an order for the defendant to refund P4,000 as the proportionate reduction of the purchase price, with legal interest from the execution of the deed of sale under either relief. After hearing, judgment was rendered in favor of the plaintiff, declaring the deed of sale rescinded or cancelled and ordering the defendant to reimburse the whole amount of P18,000, or, instead of rescinding or cancelling the deed of sale, to reimburse the plaintiff the sum of P4,000 only with interest at 6% per annum from the date of the filing of the complaint until fully paid. In the event the defendant refused to do either of the alternatives, the court ordered the execution of the latter, with costs against the defendant.

The defendant perfected an appeal to the Court of Appeals but later changed his mind and withdrew his appeal, which was granted. Upon the return of the case to the trial court, the plaintiff asked for execution of the judgment, particularly the second alternative of the dispositive part, namely, the refund of P4,000 with legal interest. The defendant, on the other hand, filed a motion to comply with the judgment stating that he had chosen the first alternative declaring the deed of sale rescinded and cancelled and ordering him to return the purchase price of P18,000. Over the plaintiff's opposition, the trial court granted the defendant's motion, ordering the plaintiffs to reconvey the property to the defendant for P18,000 within ten days.

Failing to secure reconsideration, the plaintiff filed a petition for certiorari with the Court of Appeals, which dismissed the petition. After her motion for reconsideration was denied, the plaintiff appealed to the Supreme Court, but the appeal was dismissed for lack of merit. In view of these adverse resolutions, on September 6, 1951, the plaintiff filed a manifestation of waiver of her rights in the decision rendered in her favor, invoking Article 4, paragraph 2 of the old Civil Code, and asking that the status quo of the parties before the filing of the case be maintained. The plaintiff later filed a motion stating that she was waiving her rights under the decision to maintain the status quo. This motion was denied. The trial court at first refused to allow the plaintiff to appeal from that order of denial on the ground that its order of June 5, 1951 had already become final, but the appeal was finally allowed and taken to the Court of Appeals, which certified it to the Supreme Court on the ground that only questions of law were involved.

• Waiver of Rights: Plaintiff contended that only she, as plaintiff, acquired a right under the decision which was in her favor and against the defendant, and that she had the right to waive said right whereby the parties would return to their original status as if no complaint had ever been filed.

• Election of Alternative: Defendant maintained that he had chosen the first alternative of the judgment, declaring the deed of sale rescinded and cancelled and ordering him to return the purchase price of P18,000, and that this election was binding on both parties.

• Waiver of Rights: Whether the plaintiff could validly waive her rights under the alternative judgment after the defendant had elected to comply with the first alternative.
• Binding Effect of Election: Whether the defendant's election of the alternative remedy was binding on both parties.

• Waiver of Rights: No. The waiver was invalid because it was prejudicial to a third person with a right recognized by law, namely, the defendant, who had acquired a right under the judgment when he chose to comply with the first alternative.
• Binding Effect of Election: Yes. The defendant's election of the alternative eliminated the alternative and was binding on both parties, as the complaint was regarded as an offer by the plaintiff through the court, and the defendant's expression of willingness to comply constituted a formal acceptance of that offer.

• Waiver of Rights: The very law invoked by the plaintiff provides that rights may be waived unless such waiver is contrary to law, public order, public policy, morals or good customs, or prejudicial to a third person with a right recognized by law. When the trial court rendered judgment giving the defendant the choice of complying with one of the two alternative remedies, and the defendant chose to comply with the first — to annul the deed of sale, return the purchase price of P18,000, and have the plaintiff reconvey the land to him — he certainly acquired a right recognized by law. A subsequent waiver on the part of the plaintiff of her right acquired under the decision would prejudice that right.

• Binding Effect of Election: The complaint filed by the plaintiff may be regarded as an offer by her, through the court, to the defendant for him either to return the P18,000 and get back the land, or refund P4,000. This offer was approved by the court and embodied in its decision. When the defendant expressed to the court his willingness, readiness, and ability to comply with the decision, particularly the alternative ordered in it, that may be considered as a formal acceptance of the offer made by the plaintiff. Thereafter, the plaintiff cannot back out and withdraw her offer, as acceptance of an offer gives the offeree a right to compel the offeror to comply with the offer.

• Finality of Rescission: When the trial court by its decision granted that part of the prayer contained in the complaint to have the deed of sale declared null or rescinded on the ground of fraud and misrepresentation as to the area of the land, and when that decision became final, the deed of sale was for all legal purposes declared rescinded. There was nothing the plaintiff could do about it, especially after the defendant had accepted that judicial declaration of rescission and had offered to comply with his obligation to return the purchase price. The rule in the United States is similar, as stated in 49 C. J. S. 887: "The party who claims the benefit of a judgment rendered in his favor must comply with any terms or conditions which it may impose on him, and failure to do so will destroy the effect of the adjudication. Where the judgment is in the alternative, granting defendant an option to do a specified act or suffer judgment for a designated sum, his election eliminates the alternative, and is binding on both parties."

• Waiver of Rights — Rights granted by law may be waived provided such waiver is not contrary to law, public order, public policy, morals or good customs, or prejudicial to a third person with a right recognized by law. In this case, the plaintiff's waiver was invalid because it would prejudice the defendant's right, which had been acquired through his election of the first alternative remedy in the judgment.

• Alternative Judgments and Election — Where a judgment is in the alternative, granting the defendant an option to do a specified act or suffer judgment for a designated sum, his election eliminates the alternative and is binding on both parties. The party who claims the benefit of a judgment must comply with any terms and conditions which it may impose on him, and failure to do so will destroy the effect of the adjudication.

• Offer and Acceptance in Judicial Judgments — A complaint seeking alternative remedies may be regarded as an offer by the plaintiff through the court to the defendant. When the defendant expresses willingness to comply with the judgment, particularly the alternative ordered, that constitutes a formal acceptance of the offer, and thereafter the plaintiff cannot back out and withdraw her offer.

• "The very law she invokes provides that rights may be waived unless such waiver is contrary to law, public order, public policy, morals or good customs, or prejudicial to a third person with a right recognized by law." — This passage states the controlling rule on waiver of rights and establishes the framework for why the plaintiff's waiver was invalid.

• "When the defendant expressed to the court his willingness, readiness and ability to comply with the said decision, particularly the part or alternative ordered in it, that may be considered as a formal acceptance of the offer made by the plaintiff; and thereafter the plaintiff cannot back out, and withdrew her offer." — This passage articulates the Court's reasoning that the defendant's election constituted acceptance of the plaintiff's offer, binding both parties.

• "Where the judgment is in the alternative, granting defendant an option to do a specified act or suffer judgment for a designated sum, his election eliminates the alternative, and is binding on both parties." — This passage, quoted from 49 C. J. S. 887, states the canonical rule on the binding effect of an election under an alternative judgment.

• 49 C. J. S. 887 — Cited as persuasive authority from American jurisprudence establishing the rule that where a judgment is in the alternative, granting the defendant an option, his election eliminates the alternative and is binding on both parties.

• Article 4, paragraph 2, Old Civil Code — Provided that rights granted by law may be waived, provided such waiver be not contrary to public interest or public order, or prejudicial to a third person. The Court applied this provision to find the plaintiff's waiver invalid because it would prejudice the defendant's acquired right.
• Article 6, New Civil Code — The provision re-embodying Article 4, paragraph 2 of the old Civil Code, which the plaintiff also invoked in her motion.

Paras, Bengzon, C. J., Reyes, A., Jugo, Bautista Angelo, Labrador, Reyes, J. B. L., and Endencia, JJ., concurred.