AYALA CORPORATION vs. ROSA-DIANA REALTY AND DEVELOPMENT CORPORATION | G.R. No. 134284 | December 1, 2000

AYALA CORPORATION vs. ROSA-DIANA REALTY AND DEVELOPMENT CORPORATION
G.R. No. 134284, December 1, 2000 
Facts

Petitioner Ayala Corporation was the registered owner of a parcel of land located in Alfaro Street, Salcedo Village, Makati City. On April 20, 1976, Ayala sold the lot to Manuel Sy married to Vilma Po and Sy  Ka Kieng married to Rosa Chan.  The Deed of Sale executed between Ayala and the buyers contained Special Conditions of Sale and Deed Restrictions.  Among the Special Conditions of Sale were: a) the vendees shall build on the lot and submit the building plans to the vendor before September 30, 1976 for the latter‘s approval b) the construction of the building shall start on or before March 30, 1977 and completed before 1979.  Before such completion, neither the deed of sale shall be registered nor the title released even if the purchase price shall have been fully paid and c) there shall be no resale of the property. 
Issue

Whether or not the deed of restriction can be enforced by Ayala Corporation. 
Ruling

Contractual obligations between parties have the force of law between them and absent any allegation that the same are contrary to law, morals, good customs, public order or public policy, they must be complied with in good faith. The party guilty of violating the deed of restrictions may only be held alternatively liable for substitute performance of its obligation, that is, for the payment of damages. 

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