- Citation
- G.R. No. 142310
- Court
- Supreme Court
- Division
- Second Division
- Ponente
- Callejo, Sr., J.
- Decided
- September 20, 2004
Summary
This case involves a complex real property dispute arising from a 1982 agreement where ARC sold a building floor to Engineer Peñaloza for P3,105,838 in installments. After Peñaloza took possession and made substantial payments, she discovered ARC had secretly mortgaged the property, leading to foreclosure and sale to GDCIA. The Supreme Court affirmed that a perfected contract existed, that Peñaloza rightfully suspended payments due to ownership disturbance, and that she was entitled to restitution of amounts paid. The Court rejected ARC's claims of contract nullification and damages, finding ARC acted in bad faith by mortgaging property already sold. GDCIA was protected as an innocent purchaser for value. The decision establishes important precedents on contract perfection, buyer's suspension rights under ownership disturbance, and protection of good faith purchasers in real estate transactions.