Verbal sale

Dear Atty. Angela,

A year ago, I bought a house and lot from a seller for P5 million but without any formal written agreement. I’ve already paid him P2 million and promised to pay the balance in installments. I have with me the title to the property, acknowledgment receipts, paid the Real Property Tax, and even renovated the house. Suddenly, I found out that the seller passed away and his children did not know of our agreement. They are now contesting my ownership and wants me to return possession and cancel the sale made. Do I have a valid claim over the property?

Gito

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Dear Gito,

Articles 1358 and 1403 (2) (e) of the Civil Code provides that contracts for the sale of real property must be made in a public document and subscribed upon; otherwise, it cannot be enforced. This requirement, however, does not affect the validity of contracts since the law does not require a public instrument to validate the agreement but only to ensure its efficacy so that parties may be bound by it.

Thus, the scope of is limited to the enforcement of an unwritten contact and does not apply to contract that have been partially or totally implemented.

In the case of Ocampo v. Batara-Sapad, G.R. No. 256343 (2 April 2025), the Supreme Court held that, “[u]nder Articles 1477 and 1496 of the Civil Code, ownership of the thing sold is vested in the buyer upon delivery. Article 1582 of the same Code obligates the buyer to accept delivery and pay the price of the thing sold.” Further, records here show that 1) the buyer had already partially paid; 2) buyers already assumed possession of the property; and 3) seller and buyer did not stipulate any terms for the sale apart from the purchase price and payments through installment.

Under Article 1497 of the Civil Code, the object of a sale contract is deemed delivered when it is placed in the control and possession of the buyer. Here, the buyer having taken possession, is a holder of the title, paid real property taxes, and made improvements on the same are strong signs that a verbal sale had taken place.

Thus, you as the buyer already living in the property could use these evidence of the verbal sale agreement as basis for ownership, even without a written contract. Nonetheless, you are bound to pay the remaining balance to complete the sale and obtain full rights to the property.

Atty. Angela Antonio