Bible Baptist Church v. Court of Appeals

Summary

Bible Baptist Church entered a 15-year lease with the Villanuevas, paying P84,000 upfront to redeem the mortgaged property and receiving an option to buy for P1.8 million. When the church sought to exercise the option, the property owners refused. All three court levels consistently ruled against the church, holding that the option clause was unenforceable under Article 1479 of the Civil Code for lack of separate consideration. The Supreme Court emphasized that the P84,000 advance payment was merely prepaid rent that had been fully utilized, not a distinct consideration supporting the option. This case clarifies that option contracts require separate, valuable consideration explicitly specified in the agreement, distinct from rental or purchase price payments.