Republic of the Philippines An accepted unilateral promise to buy or to sell a determinate thing for a price certain is binding upon

to buy or to sell a determinate thing for a price certain is binding upon the
SUPREME COURT promissor if the promise is supported by a consideration distinct from the price.
Manila
In his complaint, plaintiff alleges that, by virtue of the option under consideration, "defendant agreed and committed to sell" and
EN BANC "the plaintiff agreed and committed to buy" the land described in the option, copy of which was annexed to said pleading as
Annex A thereof and is quoted on the margin. 1 Hence, plaintiff maintains that the promise contained in the contract is
"reciprocally demandable," pursuant to the first paragraph of said Article 1479. Although defendant had really "agreed,
promised and committed" herself to sell the land to the plaintiff, it is not true that the latter had, in turn, "agreed and committed
himself " to buy said property. Said Annex A does not bear out plaintiff's allegation to this effect. What is more, since Annex A
G.R. No. L-25494 June 14, 1972 has been made "an integral part" of his complaint, the provisions of said instrument form part "and parcel" 2 of said pleading.

NICOLAS SANCHEZ, plaintiff-appellee, The option did not impose upon plaintiff the obligation to purchase defendant's property. Annex A is not a "contract to buy and
vs. sell." It merely granted plaintiff an "option" to buy. And both parties so understood it, as indicated by the caption, "Option to
SEVERINA RIGOS, defendant-appellant. Purchase," given by them to said instrument. Under the provisions thereof, the defendant "agreed, promised and committed"
herself to sell the land therein described to the plaintiff for P1,510.00, but there is nothing in the contract to indicate that her
Santiago F. Bautista for plaintiff-appellee. aforementioned agreement, promise and undertaking is supported by a consideration "distinct from the price" stipulated for
the sale of the land.
Jesus G. Villamar for defendant-appellant.
Relying upon Article 1354 of our Civil Code, the lower court presumed the existence of said consideration, and this would seem
to be the main factor that influenced its decision in plaintiff's favor. It should be noted, however, that:

CONCEPCION, C.J.:p (1) Article 1354 applies to contracts in general, whereas the second paragraph of Article 1479 refers to "sales" in particular,
and, more specifically, to "an accepted unilateral promise to buy or to sell." In other words, Article 1479 is controlling in the case
at bar.
Appeal from a decision of the Court of First Instance of Nueva Ecija to the Court of Appeals, which certified the case to Us,
upon the ground that it involves a question purely of law.
(2) In order that said unilateral promise may be "binding upon the promisor, Article 1479 requires the concurrence of a
condition, namely, that the promise be "supported by a consideration distinct from the price." Accordingly, the promisee can not
The record shows that, on April 3, 1961, plaintiff Nicolas Sanchez and defendant Severina Rigos executed an instrument compel the promisor to comply with the promise, unless the former establishes the existence of said distinct consideration. In
entitled "Option to Purchase," whereby Mrs. Rigos "agreed, promised and committed ... to sell" to Sanchez the sum of other words, the promisee has the burden of proving such consideration. Plaintiff herein has not even alleged the existence
P1,510.00, a parcel of land situated in the barrios of Abar and Sibot, municipality of San Jose, province of Nueva Ecija, and thereof in his complaint.
more particularly described in Transfer Certificate of Title No. NT-12528 of said province, within two (2) years from said date
with the understanding that said option shall be deemed "terminated and elapsed," if "Sanchez shall fail to exercise his right to
buy the property" within the stipulated period. Inasmuch as several tenders of payment of the sum of Pl,510.00, made by (3) Upon the other hand, defendant explicitly averred in her answer, and pleaded as a special defense, the absence of said
Sanchez within said period, were rejected by Mrs. Rigos, on March 12, 1963, the former deposited said amount with the Court consideration for her promise to sell and, by joining in the petition for a judgment on the pleadings, plaintiff has impliedly
of First Instance of Nueva Ecija and commenced against the latter the present action, for specific performance and damages. admitted the truth of said averment in defendant's answer. Indeed as early as March 14, 1908, it had been held, in Bauermann
v. Casas, 3 that:

After the filing of defendant's answer admitting some allegations of the complaint, denying other allegations thereof, and
alleging, as special defense, that the contract between the parties "is a unilateral promise to sell, and the same being One who prays for judgment on the pleadings without offering proof as to the truth of his own allegations,
unsupported by any valuable consideration, by force of the New Civil Code, is null and void" on February 11, 1964, both and without giving the opposing party an opportunity to introduce evidence, must be understood to admit
parties, assisted by their respective counsel, jointly moved for a judgment on the pleadings. Accordingly, on February 28, 1964, the truth of all the material and relevant allegations of the opposing party, and to rest his motion for
the lower court rendered judgment for Sanchez, ordering Mrs. Rigos to accept the sum judicially consigned by him and to judgment on those allegations taken together with such of his own as are admitted in the pleadings. (La
execute, in his favor, the requisite deed of conveyance. Mrs. Rigos was, likewise, sentenced to pay P200.00, as attorney's Yebana Company vs. Sevilla, 9 Phil. 210). (Emphasis supplied.)
fees, and other costs. Hence, this appeal by Mrs. Rigos.
This view was reiterated in Evangelista v. De la Rosa 4 and Mercy's Incorporated v. Herminia Verde. 5
This case admittedly hinges on the proper application of Article 1479 of our Civil Code, which provides:
Squarely in point is Southwestern Sugar & Molasses Co. v. Atlantic Gulf & Pacific Co., 6 from which We quote:
ART. 1479. A promise to buy and sell a determinate thing for a price certain is reciprocally demandable.
The main contention of appellant is that the option granted to appellee to sell to it barge No. 10 for the sum However, this Court itself, in the case of Atkins, Kroll and Co., Inc. v. Cua Hian Tek, 8 decided later that Southwestern Sugar &
of P30,000 under the terms stated above has no legal effect because it is not supported by any Molasses Co. v. Atlantic Gulf & Pacific Co., 9 saw no distinction between Articles 1324 and 1479 of the Civil Code and applied
consideration and in support thereof it invokes article 1479 of the new Civil Code. The article provides: the former where a unilateral promise to sell similar to the one sued upon here was involved, treating such promise as an
option which, although not binding as a contract in itself for lack of a separate consideration, nevertheless generated a bilateral
"ART. 1479. A promise to buy and sell a determinate thing for a price certain is contract of purchase and sale upon acceptance. Speaking through Associate Justice, later Chief Justice, Cesar Bengzon, this
reciprocally demandable. Court said:

An accepted unilateral promise to buy or sell a determinate thing for a price certain is Furthermore, an option is unilateral: a promise to sell at the price fixed whenever the offeree should decide
binding upon the promisor if the promise is supported by a consideration distinct from to exercise his option within the specified time. After accepting the promise and before he exercises his
the price." option, the holder of the option is not bound to buy. He is free either to buy or not to buy later. In this case,
however, upon accepting herein petitioner's offer a bilateral promise to sell and to buy ensued, and the
respondent ipso facto assumed the obligation of a purchaser. He did not just get the right subsequently to
On the other hand, Appellee contends that, even granting that the "offer of option" is not supported by any buy or not to buy. It was not a mere option then; it was a bilateral contract of sale.
consideration, that option became binding on appellant when the appellee gave notice to it of its
acceptance, and that having accepted it within the period of option, the offer can no longer be withdrawn
and in any event such withdrawal is ineffective. In support this contention, appellee invokes article 1324 of Lastly, even supposing that Exh. A granted an option which is not binding for lack of consideration, the
the Civil Code which provides: authorities hold that:

"ART. 1324. When the offerer has allowed the offeree a certain period to accept, the "If the option is given without a consideration, it is a mere offer of a contract of sale,
offer may be withdrawn any time before acceptance by communicating such which is not binding until accepted. If, however, acceptance is made before a
withdrawal, except when the option is founded upon consideration as something paid withdrawal, it constitutes a binding contract of sale, even though the option was not
or promised." supported by a sufficient consideration. ... . (77 Corpus Juris Secundum, p. 652. See
also 27 Ruling Case Law 339 and cases cited.)

There is no question that under article 1479 of the new Civil Code "an option to sell," or "a promise to buy
or to sell," as used in said article, to be valid must be "supported by a consideration distinct from the price." "It can be taken for granted, as contended by the defendant, that the option contract
This is clearly inferred from the context of said article that a unilateral promise to buy or to sell, even if was not valid for lack of consideration. But it was, at least, an offer to sell, which was
accepted, is only binding if supported by consideration. In other words, "an accepted unilateral promise accepted by letter, and of the acceptance the offerer had knowledge before said offer
can only have a binding effect if supported by a consideration which means that the option can still be was withdrawn. The concurrence of both acts the offer and the acceptance could
withdrawn, even if accepted, if the same is not supported by any consideration. It is not disputed that the at all events have generated a contract, if none there was before (arts. 1254 and 1262
option is without consideration. It can therefore be withdrawn notwithstanding the acceptance of it by of the Civil Code)." (Zayco vs. Serra, 44 Phil. 331.)
appellee.
In other words, since there may be no valid contract without a cause or consideration, the promisor is not bound by his promise
It is true that under article 1324 of the new Civil Code, the general rule regarding offer and acceptance is and may, accordingly, withdraw it. Pending notice of its withdrawal, his accepted promise partakes, however, of the nature of an
that, when the offerer gives to the offeree a certain period to accept, "the offer may be withdrawn at any offer to sell which, if accepted, results in a perfected contract of sale.
time before acceptance" except when the option is founded upon consideration, but this general rule must
be interpreted as modified by the provision of article 1479 above referred to, which applies to "a promise to This view has the advantage of avoiding a conflict between Articles 1324 on the general principles on contracts and 1479
buy and sell" specifically. As already stated, this rule requires that a promise to sell to be valid must be on sales of the Civil Code, in line with the cardinal rule of statutory construction that, in construing different provisions of
supported by a consideration distinct from the price. one and the same law or code, such interpretation should be favored as will reconcile or harmonize said provisions and avoid a
conflict between the same. Indeed, the presumption is that, in the process of drafting the Code, its author has maintained a
We are not oblivious of the existence of American authorities which hold that an offer, once accepted, consistent philosophy or position. Moreover, the decision in Southwestern Sugar & Molasses Co. v. Atlantic Gulf & Pacific
cannot be withdrawn, regardless of whether it is supported or not by a consideration (12 Am. Jur. 528). Co., 10 holding that Art. 1324 is modified by Art. 1479 of the Civil Code, in effect, considers the latter as an exception to the
These authorities, we note, uphold the general rule applicable to offer and acceptance as contained in our former, and exceptions are not favored, unless the intention to the contrary is clear, and it is not so, insofar as said two (2)
new Civil Code. But we are prevented from applying them in view of the specific provision embodied in articles are concerned. What is more, the reference, in both the second paragraph of Art. 1479 and Art. 1324, to an option or
article 1479. While under the "offer of option" in question appellant has assumed a clear obligation to sell promise supported by or founded upon a consideration, strongly suggests that the two (2) provisions intended to enforce or
its barge to appellee and the option has been exercised in accordance with its terms, and there appears to implement the same principle.
be no valid or justifiable reason for appellant to withdraw its offer, this Court cannot adopt a different
attitude because the law on the matter is clear. Our imperative duty is to apply it unless modified by Upon mature deliberation, the Court is of the considered opinion that it should, as it hereby reiterates the doctrine laid down in
Congress. the Atkins, Kroll & Co. case, and that, insofar as inconsistent therewith, the view adhered to in the Southwestern Sugar &
Molasses Co. case should be deemed abandoned or modified.
WHEREFORE, the decision appealed from is hereby affirmed, with costs against defendant-appellant Severina Rigos. It is so Reyes, J.B.L., Makalintal, Zaldivar, Teehankee, Barredo and Makasiar, JJ., concur.
ordered.
Castro, J., took no part.