CASE BRIEF

2 Cdon 848/97


Parties:  The plaintiff v. business company A.,  M. and M. B.


Facts

The plaintiff purchased a house and a garden from the vendor - business company A. Instead of
transferring the estate to the plaintiff´s proprietorship , A sold object of the contract, made
with the plaintiff, to the second and third defendant, a married couple.  This second contract was
filed with registrar of estate and a petition was filed to put this new proprietorship in
compliance with law. The registrar gave a permission and a new ownership was officially established
in favour of the second and third defendant.


Legal issue

 The question raised by this case is whether the second contract is valid according to law or the
plaintiff can be found as an aggrieved party because of conduct of the first defendant and the
estate belongs to him. The plaintiff deems that, regardless of the second contract, estate is in
his proprietorship because the contract was completed and the second alienate is a breach of his
right to undisturbed exercise of his ownership.


Procedural history

 In the first instance court decided in favour of the plaintiff.  Court ruled that the second
contract between A. and the second and third defendant is void. According to this ruling, A. was
bound with the first contract and was not entitled to make a new contract in this matter. The
defendant did not agree and appealed against this judgement.

The second instance court reversed the ruling of the lower court and rejected the action. The court
found the second contract valid because any party involved in the first contract (the plaintiff and
A.) did not filed a petition with the registrar of estate. It was done by the second and third
defendant so their contract can not be found void. The plaintiff is only entitled to relief from A.
for loss. The case went to appeal again.

The third instance court uphold the ruling of the second instance court and finally ruled that
owners are M. and M. B.


Reasoning of the court

The third instance court argued that the contract of sale has got two phases. There is a titulus
(reason) which is a contract and a modus which causes the transfer. A titulus has got only bond
effect. The modus in this type of contract is to file the petition with the registrar of estate
what was done only by the second and the third defendant. According to this principle, obligation
from the first contract perished and as the second instance court has held, the plaintiff is only
entitled to relief from A. for loss. This contract can only be found void in case of resisting
against the statute or good manners what can not be used in this situation.

The court drew the conclusion that this case is about collision between obligation and property
right and the preference must be always given to the right of an owner.