Nonato v. IAC · G.R. L-67181

Petitioner: Nonato
Respondent: IAC
Citation: G.R. No. L-67181
Court: Supreme Court
Decided: November 22, 1985

Whether a vendor who cancelled an installment sale by repossessing the vehicle can still demand payment of the unpaid balance of the purchase price

Summary

The Supreme Court reversed lower courts' decisions in this installment sale dispute involving spouses Nonato and Investor's Finance Corporation. The Nonatos purchased a Volkswagen on installment but defaulted on payments. IFC repossessed the vehicle in March 1978 but still demanded payment of the unpaid balance. The Court applied Article 1484 of the Civil Code, which provides three alternative remedies for vendors in installment sales: exact fulfillment, cancel the sale, or foreclose chattel mortgage. The Court found that IFC's repossession with a redemption notice constituted cancellation of the sale, barring any further collection action. The decision reinforced that these remedies are alternative, not cumulative, establishing important precedent for installment sale disputes and protecting buyers from double recovery by sellers.

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The Maceda Law (Republic Act 6552)

By the Intellegal Editorial Board · November 22, 1985

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