Magoyag v. Maruhom (G.R. No. 179743; August 2, 2010)

CASE DIGEST: HADJA FATIMA GAGUIL MAGOYAG, joined by her husband, HADJI HASAN MADLAWI MAGOYAG, Petitioners, vs. HADJI ABUBACAR MARUHOM, Respondent. (G.R. No. 179743; August 2, 2010).

FACTS: Maruhom was awarded a market stall in Marawi City. He orally sold the same to Magoyag. Subsequently, he executed a Deed of Assignment in favor of Magoyag to confirm the sale. In the same deed, the stall was leased back to Maruhom. Maruhom stopped paying rental, thus, Magoyag demanded Maruhom to vacate the market stall.

ISSUE: Is the transaction was a contract of sale, thus allowing Magoyag to compel Maruhom to vacate the premises?

HELD: The transaction involved is a deed of sale.

A void contract is equivalent to nothing; it produces no civil effect. It does not create, modify, or extinguish a juridical relation. Parties to a void agreement cannot expect the aid of the law; the courts leave them as they are, because they are deemed in pari delicto or in equal fault. To this rule, however, there are exceptions that permit the return of that which may have been given under a void contract. One of the exceptions is found in Article 1412 of the Civil Code, which states:

Art. 1412. If the act in which the unlawful or forbidden cause consists does not constitute a criminal offense, the following rules shall be observed: (1) When the fault is on the part of both contracting parties, neither may recover what he has given by virtue of the contract, or demand the performance of the other's undertaking; (2) When only one of the contracting parties is at fault, he cannot recover what he has given by reason of the contract, or ask for the fulfillment of what has been promised him. The other, who is not at fault, may demand the return of what he has given without any obligation to comply with his promise. (Civil Code)

Under normal circumstances, the seller can be compelled to vacate the sold premises. However, in the case at hand, the market stall is owned by the City Government of Marawi, and may not be alienated without its consent. The sale being null and void, it may not be enforced; Maruhom should not vacate the premises.