148 Buenviaje v. Spouses Salonga - DIGEST
148 Buenviaje v. Spouses Salonga - DIGEST
148 Buenviaje v. Spouses Salonga - DIGEST
Facts:
Sps. Salonga and Jebson Holdings entered into a Joint Venture Agreement (JVA) wherein the 3
parcels of land owned by the spouses were to be subdivided and to have built on them 10 high-end single
detached residential units to be known as Brentwoods Tagaytay Villas. It was understood that Jebson will
undertake the construction expenses of all units, secure the building and development permits, and the license
to sell from the Housing and Land Use Regulatory Board (HLURB), in exchange of ownership of 7 units (3,
4, 5, 6, 8, 9, and 10), while the spouses taking the remaining 3 units (1, 2, and 7). Subsequently, Jebson
entered into a contract to sell unit 5 to Dr. Buenviaje for P10.5M (+ 125K for retaining wall and air-
conditioning system expenses), notedly without the conformity of Sps. Salonga. Payment for 7.8M was done
via a “swapping arrangement,” where Dr. Buenviaje’s Garden Villas home worth 5.8M and his Tagaytay
Highlands Golf Share worth 2M as payment. The remainder was then to be paid periodically. Jebson,
however, failed to deliver Unit 5 to Dr. Buenviaje, allegedly because of the 1997 Asian Financial Crisis. This
prompted Dr. Buenviaje to demand the completion and delivery of the unit in 1999. Jebson asked for an
extension until early 2000, which even when accepted, they did not meet; hence, the filing of a Complaint
for Specific Performance with Damages was filed by Dr. Buenviaje against Jebson, Sps. Salonga, and Banez
before the HLURB Regional Field Office IV (HLURB RIV). Dr. Buenviaje prayed for the completion and
delivery, and in the alternative, for the rescission of the Contract to Sell. In their answer, Jebson argued that
they were ready to deliver, however, Sps. Salonga had not yet processed the consolidation of its parcels of
land and its subsequent partition into 10 lots. Sps. Salonga meanwhile assails that they had no privity of
contract with Dr. Buenviaje (and other similarly situated buyers) as the Contracts to Sell were unenforceable
on the ground that they were entered by Jebson into without their conformity. The HLURB-RIV ruled in
favor of Dr. Buenviaje, but such decision was reversed by the HLURB Board of Commissioners (HLURB-
BOC) on the ground that the swapping agreement entered into by the parties caused the lack of cash of Jebson
to complete the project. Hence, the HLURB-BOC, by still upholding the Contract to Sell, ordered the return
of the payments in kind to Dr. Buenviaje, ordered the same to pay Jebson in cash, ordered Jebson to finish
the project within six months as they were in the finishing stage already, and held Sps. Salonga not solidarily
liable with Jebson as they did not have anything to do with Jebson’s project. When elevated before the Office
of the President and the Court of Appeals, the two courts affirmed the HLURB-BOC decision in finding Sps.
Salonga free from liability, while also finding that the rescission prayed for by Dr. Buenviaje was not the
most economical solution to the instant case as the units are already in the finishing stage and subsequently
finding the rescission of the swapping arrangements proper.
Issue(s):
Ruling:
SC:
The SC ruled in favor of Dr. Buenviaje in finding the swapping agreement valid, while also finding
that specific performance was the proper remedy, ordering Jebson to complete the project.