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    Heirs of Salas V Laperal

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    Wilton Norman Jvmantoc
    This case discusses the validity of arbitration agreements under Philippine law. The heirs of Augusto Salas Jr. filed a complaint seeking rescission of contracts involving the sale of Salas' land by Laperal Realty Corp. Laperal Realty sought to compel arbitration based on an arbitration clause in their agreement with Salas. The Court ruled that while rescission claims are generally arbitrable, the arbitration clause did not apply to the lot buyers who were not party to the agreement. It was in the interest of justice for the court to hear the entire case against all respondents in a single proceeding rather than splitting it between arbitration and litigation.

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    Heirs of Salas V Laperal

    Uploaded by

    Wilton Norman Jvmantoc
    1K views2 pages
    This case discusses the validity of arbitration agreements under Philippine law. The heirs of Augusto Salas Jr. filed a complaint seeking rescission of contracts involving the sale of Salas' land by Laperal Realty Corp. Laperal Realty sought to compel arbitration based on an arbitration clause in their agreement with Salas. The Court ruled that while rescission claims are generally arbitrable, the arbitration clause did not apply to the lot buyers who were not party to the agreement. It was in the interest of justice for the court to hear the entire case against all respondents in a single proceeding rather than splitting it between arbitration and litigation.

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    This case discusses the validity of arbitration agreements under Philippine law. The heirs of Augusto Salas Jr. filed a complaint seeking rescission of contracts involving the sale of Salas' land by Laperal Realty Corp. Laperal Realty sought to compel arbitration based on an arbitration clause in their agreement with Salas. The Court ruled that while rescission claims are generally arbitrable, the arbitration clause did not apply to the lot buyers who were not party to the agreement. It was in the interest of justice for the court to hear the entire case against all respondents in a single proceeding rather than splitting it between arbitration and litigation.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    1K views2 pages

    Heirs of Salas V Laperal

    Uploaded by

    Wilton Norman Jvmantoc
    This case discusses the validity of arbitration agreements under Philippine law. The heirs of Augusto Salas Jr. filed a complaint seeking rescission of contracts involving the sale of Salas' land by Laperal Realty Corp. Laperal Realty sought to compel arbitration based on an arbitration clause in their agreement with Salas. The Court ruled that while rescission claims are generally arbitrable, the arbitration clause did not apply to the lot buyers who were not party to the agreement. It was in the interest of justice for the court to hear the entire case against all respondents in a single proceeding rather than splitting it between arbitration and litigation.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    Case:

    Heirs of Augusto L. Salas, Jr. vs Laperal Realty Corp., G.R. No. 135362,
    December 13, 1999

    Doctrine:
    The Court has recognized arbitration agreements as valid, binding, enforceable
    and not contrary to public policy so much that when there obtains a written provision for
    arbitration which is not complied with, the trial court should suspend the proceedings and
    order the parties to proceed to arbitration in accordance with the terms of their
    agreement.

    Facts:
    Salas Jr. was the registered owner of a vast tract of land in Lipa City, Batangas
    spanning 1,484,354 square meters. On May 15, 1987, he entered into an Owner-
    Contractor Agreement with respondent Laperal Realty Corporation to render and provide
    complete construction services on his land. On September 23, 1988, Salas, Jr. executed
    a Special Power of Attorney in favor of respondent Laperal Realty to exercise general
    control, supervision and management of the sale of his land, for cash or on installment
    basis. On June 10, 1989, Salas, Jr. left his home in the morning for a business trip to
    Nueva Ecija. He never returned. After 7 years, Teresita Diaz Salas filed with the Regional
    Trial Court of Makati City a verified petition for the declaration of presumptive death of
    her husband, Salas, Jr., who had then been missing for more than seven years. It was
    granted on December 12, 1996.

    Meantime, respondent Laperal Realty subdivided the land of Salas, Jr. and sold
    subdivided portions thereof to respondents Rockway Real Estate Corporation and South
    Ridge Village, Inc.; to respondent spouses Abrajano and Lava and Oscar Dacillo; and to
    respondents Eduardo Vacuna, Florante de la Cruz and Jesus Vicente Capalan (all of whom
    are hereinafter referred to as respondent lot buyers).

    On February 3, 1998, petitioners as heirs of Salas, Jr. filed in the Regional Trial
    Court of Lipa City a Complaint for declaration of nullity of sale, reconveyance, cancellation
    of contract, accounting and damages against herein respondents which was docketed as
    Civil Case No. 98-0047. On April 24, 1998, respondent Laperal Realty filed a Motion to
    Dismiss on the ground that petitioners failed to submit their grievance to arbitration as
    required under Article VI of the Agreement of their arbitration clause.

    Issue:
    Whether or not rescission is an arbitrable?

    Ruling:
    Yes.

    The petitioners' contention is without merit. For while rescission, as a general rule,
    is an arbitrable issue, they impleaded in the suit for rescission the respondent lot buyers
    who are neither parties to the Agreement nor the latter's assigns or heirs. Consequently,
    the right to arbitrate as provided in Article VI of the Agreement was never vested in
    respondent lot buyers.

    Respondent Laperal Realty, as a contracting party to the Agreement, has the right
    to compel petitioners to first arbitrate before seeking judicial relief. However, to split the
    proceedings into arbitration for respondent Laperal Realty and trial for the respondent lot
    buyers, or to hold trial in abeyance pending arbitration between petitioners and
    respondent Laperal Realty, would in effect result in multiplicity of suits, duplicitous
    procedure and unnecessary delay. On the other hand, it would be in the interest of justice
    if the trial court hears the complaint against all herein respondents and adjudicates
    petitioners' rights as against theirs in a single and complete proceeding.

    Digested by:
    Wilton Norman S. Jumantoc / JD-2 / Alternative Dispute Resolution

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