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SC clears two entities’ compromise over property dispute


THE Supreme Court (SC) has approved a compromise agreement between Malate Construction Development Corp. (MCDC) and Extraordinary Realty Agents & Brokers Cooperative that involved the former paying a reduced amount of P3 million over a property dispute.

In a five-page resolution, the SC Special Second Division said the agreement did not violate any laws or public policies.

“The parties not only consented to all the terms of the compromise agreement but even jointly clamored for its approval before the Court,” the tribunal said.

“Equally important, all the essential requisites of a  contract are present in the compromise agreement.”

The High Court said the case is now closed and terminated as the parties have settled the dispute.

In 2003, the two companies entered into a marketing agreement where the realty cooperative, the respondent, committed to promote and sell MCDC’s properties in Calamba, Laguna in exchange for a commission.

The dispute stemmed from MCDC refusing to pay the realty firm its commissions in 2005 and 2006, which prompted a damages lawsuit seeking the payment of P4.962,935.77 with interest.

In 2013, the Manila Regional Trial Court Branch 47 ruled in favor of the respondent and ordered the construction company to pay P4.069,919.88 million with a 12% interest.

The Court of Appeals affirmed the fees and imposed an additional 6% interest for each year after the decision was deemed final.

On Jan. 5, 2022, the High Court upheld the decision but absolved Giovanni Olivares, MCDC’s president, from liability for the unpaid commissions.

The two firms were unaware of the court’s decision when they entered into the compromise agreement on May 11 of that year.

The high tribunal said the agreement was still valid since both parties consented to the compromise even after the ruling attained finality.

“Verily, if a compromise agreement is allowed after a final judgment, then all the more should it be permitted before the judgment attains finality and more so, prior to the parties’ receipt of the ruling,” It said in the ruling. — John Victor D. Ordoñez

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