**Roberto R. David vs. Eduardo C. David: A Case of Property Repurchase Rights**
### Facts:
The dispute between Eduardo C. David and his cousin Roberto R. David, revolves around the exercise of a right to repurchase a property and assets initially sold. The property in question included a parcel of land in Baguio City along with two International CO 9670 Truck Tractors with Mi-Bed Trailers. This property was sold to Roberto by Eduardo and Edwin (Eduardo’s brother) acting on their behalf and that of their co-heirs for a total consideration of P6,000,000.00. The agreement, encapsulated in a deed of sale with assumption of mortgage, conditioned that Eduardo and Edwin could repurchase the properties within three years, with a specified interest. Although a memorandum of agreement (MOA) involving a different sale of the Baguio City lot to a third party was later executed, Eduardo sought to exercise his repurchase right, particularly with respect to one truck tractor and trailer not returned by Roberto. This led to a replevin suit filed by Eduardo to recover possession or, alternatively, the value of the items. The Regional Trial Court (RTC) ruled in favor of Eduardo, a decision later affirmed by the Court of Appeals (CA), prompting Roberto’s petition for review on certiorari to the Supreme Court.
### Issues:
1. Whether Eduardo effectively exercised his right to repurchase the properties in question.
2. Whether the execution of the memorandum of agreement (MOA) between Roberto and the third party novated the original deed of sale.
3. Whether the legal doctrines and articles pertaining to sales with the right to repurchase were appropriately applied in Eduardo’s favor.
### Court’s Decision:
The Supreme Court dismissed Roberto’s petition, affirming the decisions of both the RTC and the CA. It held that the factual findings of the lower courts—finding that Eduardo satisfied the conditions for the repurchase set forth in the deed of sale—were binding. The Court elaborated that Eduardo’s actions, including the payment of the repurchase price via deposit to Roberto’s account, constituted an effective exercise of the right to repurchase. It further determined that the MOA did not novate the original deed of sale, as the conditions for novation were not met, let alone addressed by Roberto substantively. Every legal issue raised was determined in favor of Eduardo’s actions and intentions to repurchase.
### Doctrine:
In sales with the right to repurchase, title and ownership immediately transfer to the buyer subject to a resolutory condition allowing the seller to repurchase the property within a stipulated period. Fulfilling the repurchase conditions effectively reverses the ownership transfer, reinstating the original seller’s ownership.
### Class Notes:
1. **Right to Repurchase**: Conditional sales involve the transfer of ownership with a resolutory condition that allows the original owner to regain ownership upon satisfying agreed conditions within a specified period.
2. **Doctrine of Novation**: For a novation to occur, there must be a clear and unequivocal agreement to extinguish the old obligation by creating a new one. Absence of any requisite element negates novation.
3. **Resolutory Conditions**: Actions that fulfill the conditions for the exercise of a right to repurchase must be clear, definite, and manifest to all parties involved.
4. **Effective Repurchase**: Payment or a valid tender of the full redemption price within the repurchase period constitutes an effective exercise of the right to repurchase.
### Historical Background:
The case highlights the complexity of property transactions within familial relationships and business partnerships, especially when conditional agreements like rights to repurchase are involved. It underscores the strict legal interpretation and requirements for the exercise of such rights, the importance of clarifying intentions through actions backed by legal stipulations, and the pivotal role of judiciary interpretation in resolving disputes arising from ambiguously executed agreements.
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