G.R. No. 172983, 22 July 2015
The Central Bank of the Philippines (Central Bank) issued Monetary Board (MB) Resolution No. 699, placing Pacific Banking Corporation (PBC) under receivership. It formally invited banks to submit their proposals for the purchase of the assets and franchise of the various offices of the PBC and the assumption of an equivalent amount of the PBC s liabilities. Thus, the FEBTC submitted its bid. The FEBTC’s bid covered the purchase of the PBC’s non-fixed and fixed assets and the assumption of the PBC’s recorded liabilities which the Monetary Board accepted after finding it as the most advantageous.
The FEBTC as the buyer, the PBC as the seller, and the Central Bank entered into a Memorandum of Agreement (MOA) which stated that the parties shall execute an absolute purchase agreement covering all the assets of the PBC. They agreed, however, that the PBC assets submitted to the Central Bank as collaterals shall be excluded from the purchase.
The parties agreed that the effectivity date of the PA shall be the date of its approval by the Liquidation Court. PA was approved by the Monetary Board on October 24, 1986.
Respondent Philippine Deposit Insurance Commission (PDIC), thereafter, took over as the new PBC Liquidator. Liquidator Nañagas informed the FEBTC that all the fixed assets of the PBC can be purchased only at their present appraisal value which is much higher than their sound value. This move prompted the FEBTC to file before the RTC (the Liquidating Court) a motion to compel the Liquidator to execute the implementing deeds of sale over the disputed PBC fixed assets.
The RTC directed the PDIC to execute the implementing deeds of absolute sale in favor of the FEBTC; and order the FEBTC to pay the price for the fixed assets in the amount equivalent to their sound values as stated in the Asian Appraisal Report which was however, reversed by the CA.
Hence, this petition.
Whether or not the PDIC, as the Liquidator of the PBC, may be compelled to execute the deeds of sale.
The court ruled in the affirmative, as there was a perfected contract of sale over the disputed fixed assets.
It is well-established that a contract undergoes various stages that include its negotiation or preparation, its perfection, and finally, its consummation. Negotiation covers the period from the time the prospective contracting parties indicate interest in the contract to the time the contract is concluded (perfected). The perfection of the contract takes place upon the concurrence of its essential elements. A contract which is consensual as to perfection is so established upon a mere meeting of minds, i.e., the concurrence of offer and acceptance, on the object and on the cause or consideration. The consummation stage begins when the parties perform their respective undertakings under the contract, culminating in its extinguishment. Specifically, contracts of sale are perfected by mutual consent, when the seller obligates himself, for a price certain, to deliver and transfer ownership of a specified thing or right to the buyer over which the latter agrees.
Mutual consent, as a state of mind, may only be inferred from the confluence of two acts of the parties: an offer certain as to the object of the contract and its consideration, and an absolute acceptance of the offer, i.e., with respect to the exact object and consideration embodied in the offer. While it may not be possible to expect the acceptance to echo every nuance of the offer, it is imperative that it assents to those points in the offer that, under the operative facts of each contract, are not only material but motivating as well.
Simply put, a contract of sale is perfected upon the meeting of the minds of the parties on the essential elements of the contract, i.e., consent, object certain, and the consideration of the contract. Based on the above well-established principles, the Court rules that the essential elements of a contract of sale are present in the MOA as confirmed by the FEBTC’s bid and the provisions of the MOA and the PA.
Furthermore, a contract of sale is perfected by the meeting of the minds of the parties regardless of whether it was reduced to writing. A binding contract may exist between the parties whose minds have met, although they did not affix their signatures to any written document, as acceptance may be expressed or implied. The law or jurisprudence does not mandate that the contract of sale be put in writing before such contract can validly cede or transmit rights over a certain real property between the parties themselves. In view of the perfection of the contract of sale, the execution of the PA over the fixed assets, like the executed PA over the non-fixed assets, falls under the consummation stage and not the perfection stage.
Hence, the court GRANTED the FEBTC’s petition for review on certiorari, and REVERSED Decision of the Court of Appeals
*Case Digest by Radolfzell Adasa, JD – 4, Andres Bonifacio College, SY 2019 – 2020