- Petitioner
- Hadja Fatima Gaguil Magoyag
- Respondent
- Hadji Abubacar Maruhom
- Citation
- G.R. No. 179743
- Court
- Supreme Court
- Division
- Second Division
- Ponente
- Nachura, J.
- Decided
- August 2, 2010
Summary
This Supreme Court case involved a dispute over Market Stall No. CTD 1583 in Marawi City's Reclamation Area. Respondent Maruhom, who was awarded the stall by the city government in 1982, executed a Deed of Assignment in 1985 transferring it to petitioners Magoyag for P20,000.00 with a leaseback arrangement. When Maruhom stopped paying rentals in 1993, petitioners sued for possession. The Court of Appeals incorrectly interpreted the transaction as a loan with mortgage. The Supreme Court corrected this, holding it was clearly a sale based on unambiguous contract terms. However, since the stall was city-owned and Maruhom was merely a grantee prohibited from selling without consent, the Deed of Assignment was declared void ab initio. Under Article 1412 of the Civil Code governing void contracts, respondent was ordered to return the P20,000.00 with interest, as petitioners were not at fault for the prohibition.