Agustina Liquette Tan v. Court of Appeals

Summary

This case involves a real estate sale contract where petitioner Agustina Tan sought to rescind her agreement to purchase spouses Singson's Baguio property for P1,750,000.00, claiming substantial breach due to the sellers' failure to deliver clear title on the agreed date. The property had various encumbrances including a DBP mortgage and levy notice. The RTC granted rescission, but the Court of Appeals reversed, ordering specific performance. The Supreme Court affirmed the CA with modification, ruling that the sellers' mere delay of a few days in clearing title was not substantial breach warranting rescission under Article 1191 of the Civil Code. The Court found that the sellers substantially complied with their obligations and were ready to perform, while the buyer failed to pay the balance despite demands. The decision emphasizes that rescission requires substantial, not slight or casual breach, and ordered the buyer to pay the balance within 90 days.