Babao vs Perez, et.al. GR No. L-8334, December 28, 1957
Subject: Obligations and Contracts
FACTS
Celestina Perez was the owner of a
parcel of land. In 1924, when Santiago Babao married her niece Maria Cleofe,
Babao and Celestina Perez entered into a verbal agreement where Santiago bound
himself to (1) improve the land by levelling and clearing all forest trees and
planting coconuts, rice, corn and other crops and (2) act as the administrator
thereof during the lifetime of Perez. In consideration of which, Perez bound
herself to convey to Babao for his wife ½ of the land together with all of its
improvements upon her death. A few days before she died, Perez sold 127.5
hectares of the land depriving Babao of its possession and administration.
When Santiago
Babao died in 1948, Bienvenido Babao was appointed the judicial administrator
of his estate. He filed a case for the conveyance of the ½ portion of the land
and the annulment of the sales of the portion having been made fictitiously and
in the alternative, for judgment in favor of Babao for P47,000 the useful and
necessary expenses he incurred in improving the land.
While the case was
pending in the lower court, counsel for Perez filed a motion to dismiss on the
grounds that the alleged verbal agreement was unenforceable under the Statute
of Frauds. However, the trial court denined the motion because it appeared that
Babao fully complied with his part of the oral contract. The court held that
the Statute of Frauds cannot be invoked because of the performance by one party
of his part of the contract takes the case our of the statute.
ISSUE
Whether or not the
verbal agremeent falls within the prohibition of the Statute of Frauds and is
therefore, unenforceable.
RULING
Yes, it is
unenforceable.
Under the law (Art
1403, NCC), in the following cases an agreement hereafter made shall be
unenforceable by action, unless the same, or some note or memorandum, thereof,
be in writing, subscribed by the party charged, or by his agent; evidence,
therefore, of the agreement cannot be received without the writing, or a
secondary evidence of its contents.
In this case, the
contract is uneforceable and cannot be proved by parol or oral evidence. Even
if Babao had partially performed the contract within one year from the making
thereof, still the Statute would apply, because in order that partial
performance of the contract may take the case out of the operation of the
Statutem it must appeal clearly that full performance had been made by one
party within one year. All that is required is complete performance had been
made by one party, no matter how many years have to elapse before the agreement
is performed by one party will suffice. If anything remains still to be done
after the expiration of the year besides the mere payment of money, the Statute
will apply.
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