Enrique C. Abad v. Goldloop Properties

Summary

This case involves contract interpretation regarding a Deed of Conditional Sale for agricultural land between the Abad family and Goldloop Properties, Inc. When the buyer failed to pay the balance due to economic conditions, it demanded return of the P6,765,660 first payment under paragraph 8 of the contract. The sellers argued this obligation was conditional, requiring the buyer to first request an extension. All three court levels ruled in favor of the buyer, applying the literal interpretation rule under Article 1370 of the Civil Code. The Supreme Court held that when contract terms are clear and unambiguous, courts must enforce the literal meaning. The contract clearly distinguished between the forfeitable earnest money and the returnable first payment, creating an unconditional obligation to return the latter upon the buyer's failure to complete the purchase.