REVA RAZ, PETITIONER, VS. THE INTERMEDIATE APPELLATE COURT, FOURTH CIVIL CASES DIVISION AND ENCARNACION VILLANUEVA, RESPONDENTS.

The subject of this petition is a Conditional Assignment of
Rights and Interests over a Foreclosure Judgment entered into between
petitioner Reva Raz and the
original private respondent herein, Encarnacion
Villanueva, on August 7, 1972.^[1]

The said judgment was rendered in favor of Villanueva on February 5, 1969, and ordered the
defendants therein to pay her the amount of P35,000.00, with 12% per annum
interest from August 7, 1965,
and other amounts, in default of which the property subject of the proceeding would
be sold at public auction to satisfy the amounts owing her.^[2]
This property was a parcel of land located at Quezon City which had been
mortgaged by the defendants to secure the payment of a loan she had extended to
them.  The judgment was pending appeal
before the respondent court at the time of the execution of the Conditional
Assignment.

By virtue of the Conditional Assignment, Villanueva transferred
all her rights and interests in the said judgment to Raz
in consideration of the sum of P75,000.00 to be paid by the petitioner as follows:

a)      The ASSIGNEE shall pay
the ASSIGNOR, her heirs and/or assigns the sum of TWENTY TWO THOUSAND
(P22,000.00), upon the signing of this
agreement.

b)      The ASSIGNEE shall pay
the ASSIGNOR, her heirs and/or assigns the sum of TWENTY THOUSAND (P20,000.00),
within one year from August 7, 1972,
and not later, August 7, 1973;

c)      The balance of THIRTY
THREE THOUSAND P33,000.00) plus costs mentioned in the said judgment shall be
paid within the next following year and not later, August 7, 1974.  It is further understood that the full
consideration mentioned in paragraph 3, and the costs mentioned in par. c,
hereof shall be fully liquidated
in two (2) years time from the signing of this agreement and not later, August 7,
1974.

It was also stipulated in Par. 3(d) of the agreement –

d)      That the ASSIGNOR
shall, as soon as the decision in the aforementioned case shall become final
and executory, proceed with the execution of the
judgment and the auction sale if allowed by law of the property subject matter
of the aforementioned case, and the ASSIGNOR and/or her heirs shall as soon as
the full consideration hereof is fully
satisfied, and if by operation of law shall become the legitimate owner
of the said property, execute a Deed of Sale in favor of the ASSIGNEE or her
heirs, and/or assigns in order to make this CONDITIONAL ASSIGNMENT OF RIGHTS AND INTERESTS permanent.  All expenses for such execution and auction
sale and other expenses necessary thereto shall be for the account of the
ASSIGNEE.

The petitioner paid the first installment of P22,000.00 on August 7, 1972, and the second
installment of P20,000.00 on August 7,
1973.  However, she refused
to pay the third installment of P33,000.00, which was supposed to be due on August 7, 1974, on the ground that
Villanueva had not complied with her obligation under their agreement.

On April 13, 1978,
the petitioner filed a complaint for specific performance and damages against
the private respondent, claiming that the latter had reneged on her duty to deliver
the property to the assignee in accordance with their agreement.

In her answer, Villanueva alleged that it was the petitioner who
had defaulted in her payments and thus given just cause for the rescission of
the agreement.  This was authorized in its
Par. 3(h) reading as follows:

h)      If for any reason, any of the above terms and conditions cannot
fully be complied, the same may be considered rescinded by either party, in
which event the ASSIGNOR shall return whatever money she or her heirs may have
received from the ASSIGNEE, and the said ASSIGNEE, shall relinquish any and all
rights which if any she or her heirs may have, and this contract shall forthwith be considered null and void and without
force and effect whatsoever.

To support her claim, Villanueva presented two letters^[3]
she said she had sent Raz, the first to remind her of
the third installment that had not yet been paid and the second to tender her
the refund of her earlier payments in view of the rescission of their contract.
These letters follow:

April 22, 1975

Reva Raz

16-A A. Matiyaga St.

Quezon City

Dear Mr. Raz:

I am writing you this
letter to remind you of your obligation under the Deed of Assignment we have
entered into.  You have not complied with
your promise to pay me the P33,000.00 the costs and expenses corresponding
thereto.

Hoping that you give
this matter your preferential attention. 
Final demand is hereby made that you pay the aforesaid amount otherwise I
will be constrained to rescind the contract and avail of my rights provided for
in the contract.

Truly yours,

(Sgd.)
ENCARNACION G. VILLANUEVA

x x
x

May 13, 1975

Mr. Reva C. Raz

16-A Matiyaga St.

Quezon City

Dear Mr. Raz:

I am writing you this
letter again to inform you that inasmuch that you failed to pay me the
P33,000.00 the costs and expenses corresponding thereto as provided in our
contract of August 7, 1972, I am making to you this formal tender of payment of the P42,000.00 you
paid me before.

Please give this matter your preferential
attention because if I will not hear from you within a period of two (2) days from receipt hereof I
will be constrained to consign aforesaid amount in court at your own costs.

Yours truly,

(Sgd.) ENCARNACION VILLANUEVA

For her part, Raz
contended that it was the private respondent who had incurred in delay and bad
faith.  The petitioner pointed out that
the motion to dismiss the appeal was filed by the appellants on August 16, 1972, and was granted by
the Court of Appeals in a resolution dated December 15, 1972. 
Yet it was only on August 16,
1973, that the private respondent filed a motion for execution of
the foreclosure judgment.

This motion was granted by the trial court on October 6, 1973.  The property was sold at public auction on January 23, 1975, and the certificate of sale was
issued in favor of Villanueva on February
25, 1975.  This was
registered on March 26, 1975,
and the period of redemption expired
one year later.  However, it was only on February 9, 1978, that the court, on Villanueva’s motion, ordered the
confirmation of the sale and a new certificate of title was issued in her name.

According to the petitioner, the two letters allegedly sent to her by the private respondents
should not have been admitted in evidence not only because there was no proof
that she had received them.  No less
importantly, their genuineness had not been established in accordance with Rule
132, Section 21, reading as follows:

Sec. 21.  Private writing,
its execution and authenticity, how proved. 
– Before any private writing may be received in evidence, its due
execution and authenticity must be proved either:

a)      By anyone who saw the
writing executed;

b)      By evidence of the
genuineness of the handwriting of the maker; or

c)      By a subscribing
witness.

The petitioner likewise submitted that the rescission of the
agreement was improper because it was Villanueva who had violated the contract
by refusing to deliver the property to her. 
Moreover, every rescission, even if extrajudicial, requires proper
notice to the other party, and there was no proof that such notice had been
served on her.

The Court has deliberated on the issues and the arguments of the
parties and finds that the respondent court^[4]
committed no reversible error in sustaining the trial court^[5]
and dismissing the appeal.

The petitioner was actually arguing against herself in invoking
Rule 132, Section 21, for one of the modes prescribed therein for proving the
execution and authenticity of any private writing is “by evidence of the
genuineness of the handwriting of the maker.” This mode must be read with
Section 23 of the same Rule, which says that –

x x x Evidence
respecting the handwriting may also be given by a comparison, made by the
witness or the court, with writings admitted or treated as genuine by the party
against whom the evidence is offered or proved to be genuine to the satisfaction of the judge.

We have made such comparison and find that the signature of Encarnacion G. Villanueva on the Conditional Assignment
(which is not disputed) is similar to the signatures affixed to the two letters
sent to the petitioner.  There is no
doubt that the agreement and the two letters were signed by private respondent Encarnacion G. Villanueva. 
Consequently, their authenticity and execution having been established,
we hold that the letters were admissible as evidence of the private respondent.

The Court is also convinced that the two letters were correctly
sent to and personally delivered at the petitioner’s address as stated in the
Conditional Assignment, were actually received there and later presumably
conveyed to her.  Indeed, the signature
of the person who received the first letter closely resembles that of one of
petitioner’s counsel as an examination of her pleadings will reveal.^[6]
At any rate, even if they were not really transmitted to the petitioner and the
letters were correctly rejected as inadmissible, Raz
would still be bound by her own admission in the complaint, where she made the
following allegations in Par. 8:

a)      A week or so before
August 7, 1974,
defendant demanded from plaintiff the payment of the balance of P33,000.00 of
the consideration;

x x
x

e)      In view of plaintiff’s
insistence that the P33,000.00 would be paid only after defendant had obtained
ownership of the subject  property and
would thus be ready to execute the corresponding deed of sale, defendant
instead offered to return
the amount of P42,000.00
already paid to her by plaintiff and have the contract rescinded, clearly
revealing her interest not to recognize the aforesaid contract.  (Emphasis supplied.)

The last quoted-paragraph is especially telling because it belies
the petitioner’s insistence that she had not been notified of the
rescission.  By her own words, she has
admitted understanding the letter of May
13, 1975, as informing her that because of her failure to pay the
balance of the stipulated payment, the contract was being rescinded by the
private respondent.  As she herself
alleged, Villanueva “offered to return the amount of P42,000.00 already
paid to her by the plaintiff and have the contract rescinded.” This is a
judicial admission that the petitioner cannot now disavow.^[7]

While it is true that a certain degree of delay did accompany the
registration of the property in Villanueva’s name, this was not entirely
imputable to her.  Good faith is presumed
except in the face of the strongest evidence to the contrary, which is not
present here.  The Court also notes from
her conduct that the petitioner is not entirely blameless either.  Considering the investment she had made in
the land, having already paid thereon the sum of P33,000.00, we feel she should
have been more vigilant in the
protection of her interests.

The petitioner’s counsel repeatedly says it was informed of each development
in the sale and registration of the property “later on.”^[8]
By this vague statement, which suggests that it was not following up the matter
closely, it would absolve its client of all negligence.  We do not agree.

It seems to us that in view of her substantial stake in the
property, it behooved the petitioner to see to it that the private respondent
discharged her part of the bargain without delay, especially so since no
specific date was imposed upon the private respondent to transfer the land to
the petitioner.  If Raz
felt that Villanueva was dilly-dallying, she should have taken steps to make
her move faster (short of refusing to pay the last installment).  As the trial judge observed, “plaintiff
could very well have paid the whole amount and then substituted herself as
plaintiff in Civil Case No. 10109.” But she did not and just stood by,
waiting to hear of developments
“later on.”

The sum of it all is that the petitioner, in insisting on the
registration first in her name of the subject property before paying the
balance, was invoking a right not stipulated in the Conditional
Assignment.  What was clearly provided
therein was that the balance of P33,000.00 would be paid by her within two
years from the date of the agreement and not later than August 7, 1974. 
For her refusal to make this payment, the contract was, pursuant to its
terms, properly rescinded.

WHEREFORE, the petition is DENIED and the challenged
decision of the respondent court is AFFIRMED, with costs against the
petitioner.

SO ORDERED.

Narvasa, (Chairman), Gancayco, Griño-Aquino, and Medialdea, JJ., concur.

^[1]
Rollo, p. 36. 
Upon her death in 1979, Encarnacion Villanueva
was substituted by her daughter, Nora V. Daza.

^[2]
Annex “1;” Records, p. 124.

^[3]
Exhibits “6” and “7;” Records,
pp. 33, 34.  Reva
Raz is
erroneously addressed as “Mr.”

^[4]
Decision penned by Sison,
P.V., J. with Bidin and Veloso,
JJ. concurring.

^[5]
Decision penned by Judge Ernani Cruz Paño.

^[6]
Records, pp. 73, 80, 115, 134, 142, 145, 150, 156 and 189.

^[7]
Rule 129, Sec. 2, Rules of Court.

^[8]
Records, pp. 144-145.