Case Digest: WENONAH L. MARQUEZ AZARCON v. HOUSING AND LAND USE ARBITER, et al.

WENONAH L. MARQUEZ AZARCON v. HOUSING AND LAND USE ARBITER, et al.

399 SCRA 365 (2003)

The agreement of the parties becomes the law between them and the same shall stand in the absence of evidence showing that it is contrary to public policy.

Sagana Construction and Development Corporation (Sagana) and Wenonah Marquez-Azarcon (Azarcon) entered into a contract to sell a house and lot (subject property). Azarcon‘s loan application was disapproved, however, on account partly of Sagana‘s failure to submit certain requirements including the title to the subject property which had been burned and was pending reconstitution. Consequently, Azarcon offered to pay the balance in cash but Sagana refused to accept the same unless she pays interest.

As Azarcon refused to pay interest on the balance of the purchase price, she filed a complaint against Sagana before the Housing and Land Use Regulatory Board (Board). After hearing, a Housing and Land Use Arbiter (HLA) rendered a decision ordering Azarcon to pay the balance of the purchase price, and Sagana to deliver the Deed of Sale and the title covering the subject property.

Upon reconsideration, the Board deleted a previous order for Azarcon to pay interest. The Board also required Azarcon to pay rentals during the time of her occupancy which shall form part of the purchase price of the premises. Azarcon thus filed a Petition for Certiorari with the Court of Appeals alleging therein that the Order issued by the HLA varied the terms of the Board decision and, as such, the Board acted with grave abuse of discretion amounting to lack of jurisdiction. CA nevertheless dismissed the petition holding that the HLA decision is in accordance with the Board Resolution. Hence, this petition.

ISSUE:

Whether or not the Court of Appeals erred in dismissing the case

HELD:

The dispute arises from the parties‘ conflicting understanding or interpretation of the phrase ―the said amount of rental shall form part of the purchase price as adjusted‖ found in the fallo, Azarcon contending that the payment of rentals is an alternative to the payment of the balance of the purchase price, and SAGANA contending that the rental payments shall be in addition to the balance of the purchase price.

Of the parties‘ interpretations, Sagana‘s is contrary to their agreement. They agreed upon the purchase price of the subject property in 1995 when they entered into the contract to sell. The amount agreed upon became the law between them. In the absence of any showing that the agreement is contrary to law, courts are without power to alter what parties have clearly, voluntarily and knowingly agreed upon.

It is clear that the payment of rentals was devised by the Board merely as an interim scheme, until a substitute method of payment of the balance of the purchase price was agreed upon by the parties.

Since Azarcon fully paid the balance of the purchase price less than three months after the Board decision was promulgated on May 10, 1993, that part of the decision respecting ―payment through other means‖ devised by the Board for Azarcon to, in the meantime, ―pay rentals as equitable payment for the use of the premises, which can be applied to the balance of the purchase price,‖ had become functus oficio.

To hold otherwise would be to fault Azarcon in whom none was, as reflected above, found by the Board. It would also gloss over Azarcon‘s initial payment of a substantial amount when they entered into the contract to sell and her tender of payment of the balance which was, however, rejected by Sagana. It would thus ignore the interest of justice and equity which underlies all systems of justice.

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