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Mate Vs CA

Fernando Mate agreed to execute a fictitious deed of sale for his three lots to Inocencio Tan at the request of Josefina Rey to help stave off prosecution for bounced checks. Mate agreed on the conditions that the lots would be repurchased by Rey within six months using her own funds. Mate received two postdated checks from Rey as assurance, but the checks bounced. Mate then filed a case to annul the contract with Tan due to lack of consideration, but both the trial court and appellate court upheld the validity of the sale, finding that consideration existed in the form of Mate's kindness to Rey and the bounced checks. The Supreme Court affirmed the appellate court's decision

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Diego Ferrer
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246 views2 pages

Mate Vs CA

Fernando Mate agreed to execute a fictitious deed of sale for his three lots to Inocencio Tan at the request of Josefina Rey to help stave off prosecution for bounced checks. Mate agreed on the conditions that the lots would be repurchased by Rey within six months using her own funds. Mate received two postdated checks from Rey as assurance, but the checks bounced. Mate then filed a case to annul the contract with Tan due to lack of consideration, but both the trial court and appellate court upheld the validity of the sale, finding that consideration existed in the form of Mate's kindness to Rey and the bounced checks. The Supreme Court affirmed the appellate court's decision

Uploaded by

Diego Ferrer
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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[G.R. No. 120724-25.

May 21, 1998]

FERNANDO T. MATE, petitioner, vs. THE HONORABLE COURT OF APPEALS and


INOCENCIO TAN, respondents.

On October 6, 1986 Josefina R. Rey and private respondent went to the residence of
petitioner at Tacloban City. Josie who is a cousin of petitioners wife solicited his help to stave
off her and her familys prosecution by private respondent for violation of B.P. 22 on account of
the rubber checks that she, her mother, sister and brother issued to private respondent amounting
to P4,432,067.00. She requested petitioner to cede to private respondent his three (3) lots in
Tacloban City in order to placate him. On hearing Josies proposal, he immediately rejected it as
he owed private respondent nothing and he was under no obligation to convey to him his
properties. Furthermore, his lots were not for sale.Josie explained to him that he was in no
danger of losing his properties as he will merely execute a simulated document transferring them
to private respondent but they will be redeemed by her with her own funds. After a long
discussion, he agreed to execute a fictitious deed of sale with right to repurchase covering his
three (3) lots mentioned above subject to the following conditions:

1. The amount to be stated in the document is P1,400,000.00 with interest thereon at 5%


a month;

2. The properties will be repurchased within six (6) months or on or before April 4,
1987;

3. Although it would appear in the document that petitioner is the vendor, it is Josie who
will provide the money for the redemption of the properties with her own funds;

4. Titles to the properties will be delivered to private respondent but the sale will not be
registered in the Register of Deeds and annotated on the titles.

To assure redemption the petitioner issued two BPI postdated checks one is for the selling
price and the other is for the interest. And the petitioner immediately prepared the deed of sale
with Right to Repurchase but the latter did not register the transaction in the Register of Deeds.

Petitioner deposited the checks but both were dishonored because the account was closed.
Then the petitioner filed a case against private respondent for Viol. of BP 22 but the case was
later archived because they can no longer be found. Petitioner filed a case for annulment of
contract with damages against Josie and respondent. Josie was declared in default and the case
proceeded against respondent. Both the Trial Court and the CA upheld the validity of Sale.

Issue: Whether the sale was null and void for want of consideration

Held: It is plain that consideration existed at the time of the execution of


the deed of sale with right of repurchase. It is not only appellant's kindness to
Josefina, being his cousin, but also his receipt of P420,000.00 from her which
impelled him to execute such contract. Furthermore, while petitioner did not
receive the P1.4 Million purchase prices from respondent Tan, he had in his
possession a postdated check of Josie Rey in an equivalent amount precisely to
repurchase the two lots on or before the sixth month. Unfortunately, the two
checks issued by Josie Rey were worthless. Both were dishonored upon
presentment by petitioner with the drawee banks. However, there is absolutely
no basis for petitioner to file a complaint against private respondent to annul
the pacto de retro sale on the ground of lack of consideration, invoking his
failure to encash the two checks. Petitioners Cause of Action was to file
criminal actions against Josie Rey under B.P. 22 which he did. The filing of
criminal cases was a tacit admission by petitioner that there was a
consideration of the pacto de retro sale.

The Decision of the Court of Appeals dated August 29, 1994 is hereby AFFIRMED. The
petition for review is hereby DENIED DUE COURSE for lack of merit.

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