Rebecca C. Young, et.al. vs Court of Appeals, et.al., GR No. 79518, January 13, 1989
Subject: Obligations and Contracts
Facts
The
Defendant Philippine Holding, Inc. is the former owner of a piece of land. The
owner Philippine Holding, Inc. secured an order from the City Engineer of
Manila to demolish the building situated on that land. Antonio Young, then a
tenant, filed an action to annul the City Engineer's demolition As an incident
in said case, the parties submitted a Compromise Agreement to the Court.
Paragraph 3 of said agreement provides that plaintiff (Antonio S. Young) and
Rebecca Young and all persons claiming rights under them bind themselves to
voluntarily and peacefully vacate the premises which they were occupying as
lessees which are the subject of the condemnation and demolition order and to
surrender possession. A case was filed to the RTC and Young contended that even
assuming that her supposed right of first refusal is a stipulation for the
benefit of a third person, she did not inform the obligor of her acceptance as
required by the second paragraph of Article 1311 of the Civil Code. The claim
of Rebecca C. Young was rejected by the
trial court on the following grounds: (1) that she was not a party in the Civil
Case No. 123883, wherein subject compromise agreement was submitted and
approved by the trial court apart from the fact that she did not even affix her
signature to the said compromise agreement; (2) that Rebecca Young had failed
to present any evidence to show that she had demanded from the
defendants-owners, observance of her right of first refusal before the said
owners sold units 1356, 1358 and 1360; (3) that even assuming that her supposed
right of first refusal is a stipulation for the benefit of a third person, she
did not inform the obligor of her acceptance as required by the second
paragraph of Article 1311 of the Civil Code. Chui Wan and Felisa Tan Yu and
Rebecca C. Young, assisted by her husband, appealed to the Court of Appeals
which dismissed the same on August 7, 1987, for lack of merit.
Issue
Whether or not a stipulation pour autrui is applicable
in this case.
Ruling
Yes.
Under the law, the requisites of a stipulation pour
autrui or a stipulation in favor of a third person are the following: (1) there
must be a stipulation in favor of a third person; (2) the stipulation must be a
part, not the whole, of the contract; (3) The contracting parties must have
clearly and deliberately conferred a favor upon a third person, not a mere
incidental benefit or interest; (4) the third person must have communicated his
acceptance to the obligor before its revocation; and, (5) neither of the
contracting parties bears the legal representation or authorization of the
third party.
In this case, such a stipulation is binding on said
third person, although he may not be a signatory to the contract.
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