SECOND DIVISION

[G.R. No. 137557. October 30, 2000]

DEVELOPMENT BANK OF THE PHILIPPINES, petitioner, vs. HON. COURT OF APPEALS and SPOUSES NILO and
ESPERANZA DE LA PEÑA, respondents.

DECISION
MENDOZA, J.:

This is a petition for review on certiorari of the decision,[1] dated August 7, 1998, and resolution,[2] dated February 11,
1999, of the Court of Appeals affirming with modification the decision of the Regional Trial Court, Branch 172, Valenzuela,
enjoining petitioner from rescinding the contract it had executed covering the sale of a parcel of land and ordering
respondent spouses, as vendees, to pay petitioner the amount ofP54,200.00.
The facts are undisputed:
Petitioner Development Bank of the Philippines is the owner of a parcel of land in Bulacan (now Lawang Bato,
Valenzuela, Metro Manila)[3]as evidenced by TCT No. 13351(202029). On August 8, 1983, it sold the land to respondent
spouses Nilo and Esperanza De La Peña under a Deed of Conditional Sale for P207,000.00.[4] The Deed of Conditional
Sale stipulated:

That the down payment shall be P41,400.00 and the balance of P165,600.00 to be paid in six (6) years on the semi-annual
amortization plan at 18% interest per annum. The first amortization of P23,126.14 shall be due and payable six (6) months from the
date of execution of the Deed of Conditional Sale and all subsequent amortizations shall be due and payable every six (6) months
thereafter;

After the execution of the contract, the spouses De La Peña constructed a house on the said lot and began living
there. They also introduced other improvements therein by planting fruit trees and building a small garage.[5] Pursuant to
their contract with the DBP, respondent spouses De La Peña made the following payments:

OR. NO. DATE AMOUNT

261122 June 22, 1983 P 36,000.00

355399 August 4, 1983 5,400.00

828029 March 22, 1984 6,000.00

862947 June 4, 1984 21,000.00

1230133 November 15, 1984 3,000.00

1365914 Feb. 8, 1985 6,000.00

1545272 March 11, 1985 6,000.00

1549511 April 8, 1985 6,000.00

1549641 May 3, 1985 6,000.00

1714171 July 9, 1985 11,400.00

1893683 November 29, 1985 11,400.00

2257661 July 3, 1986 10,000.00

2349229 September 3, 1986 15,000.00

2529065 November 4, 1986 16,000.00

2830513 August 18, 1987 21,000.00

3342166 October 12, 1988 10,000.00

3367193 January 10, 1989 10,000.00

3367500 February 10, 1989 10,000.00

3461778 March 9, 1989 18,000.00

3532008 April 10, 1989 18,800.00

3617235 August 28, 1989 P33,000.00

TOTAL P289,600.00[6]

After making the above payments, Esperanza De La Peña went to petitioner DBP and asked for the execution of a
Deed of Absolute Sale and for the issuance of the title to the property.[7] On January 5, 1989, however, respondent
spouses De La Peña were informed by DBP through a letter that there was still a balance of P221,86.85, broken down as
follows, owing from them:

Principal P 150,765.35

Regular Interest 57,121.13

Additional Interest 9,799.01

Penalty Charges 4,182.36

TOTAL P 221,867.85[8]

In another letter, dated July 11, 1989, DBP demanded from respondent spouses the payment of this amount, which
had increased toP225,855.86 as of June 30, 1989, otherwise, it would rescind the sale.[9] In reply, respondent spouses, in
a letter dated August 11, 1989, proposed a settlement of the amount through semi-annual payments over a period of five
years.[10]
As the parties failed to reach an agreement, respondent spouses filed a complaint against petitioner on January 30,
1990 for specific performance and damages with injunction before the Regional Trial Court, Valenzuela, Metro
Manila.[11] The case was assigned to Branch 172 of the court. The complaint was later amended to include a prayer for the
issuance of a temporary restraining order to enjoin the defendant from rescinding the sale and selling the land to
interested buyers.[12]
On March 30, 1993, the trial court rendered a decision, the dispositive portion of which reads:

WHEREFORE, in view of the foregoing, judgment is hereby rendered,

1. Dismissing the complaint, as plaintiffs have still to pay the defendant the sum of P54,200.00 as interest to be able to sue for specific
performance;

2. The writ of preliminary injunction is hereby declared permanent;

3. Defendant to pay plaintiffs attorney’s fees in the amount of P30,000.00; and

4. Defendant to pay the costs of suit.

SO ORDERED.[13]

Petitioner filed an appeal with the Court of Appeals which rendered a decision, dated August 8, 1997, affirming with
modification the ruling of the trial court. The dispositive portion of its decision reads:

WHEREFORE, with the MODIFICATION that the grant of attorney’s fees is deleted, the appealed Decision is AFFIRMED. [14]

In its resolution, dated February 11, 1999, the Court of Appeals likewise denied petitioner’s motion for
reconsideration.[15]
Hence, this petition. Petitioner now contends:
1. BOTH THE TRIAL COURT AND THE COURT OF APPEALS GAVE A MANIFESTLY MISTAKEN AND ABSURD CONSTRUCTION OF
THE DEED OF CONDITIONAL SALE CONTRACT (ANNEX “E”).

2. THE HONORABLE COURT OF APPEALS GRAVELY ERRED AND COMMITTED REVERSIBLE ERROR WHEN IT AFFIRMED THE
TRIAL COURT’S ISSUANCE OF THE INJUNCTION AGAINST PETITIONER DBP PERMANENT.[16]

First. The Court of Appeals held:

A careful reading of the aforequoted provisions reveals that while the period of payment (six years) and the amount of the first
amortization (P23,126.14) are stipulated, the amount that the vendees should pay semi-annually is not specified. Since the Deed of
Conditional Sale executed by the parties is a contract of adhesion, i.e., a ready-made contract to which appellees merely affixed their
assent or “adhesion”, as the court a quo correctly found, a restrictive construction of the obscure provision regarding the amount of
semi-annual amortizations should be made against the drafter DBP (PAL vs. Court of Appeals, 255 SCRA 48, BPI Credit vs. Court of
Appeals, 204 SCRA 611; Maersk Lines vs. Court of Appeals, 222 SCRA 108; Angeles vs. Calasaz, 135 SCRA 323). It is not disputed
that appellant Bank was the party responsible for the preparation of the Deed of Conditional Sale. Any ambiguity in the contract
whose terms are susceptible of different interpretations must be read against appellant as the party which drafted the contract (Nacu
vs. Court of Appeals, 231 SCRA 237). Thus the contract of the parties must be interpreted, in so far as the manner and amounts of
amortization is concerned, to be at the option of the vendees, subject only to the condition that the latter should pay the balance of the
purchase price within a period of six years.[17]

The questioned provision states:

That the down payment shall be P41,400.00 and the balance of P165,600.00 to be paid in six (6) years on the semi-annual
amortization plan at 18% interest per annum. The first amortization of P23,126.14 shall be due and payable six (6) months from the
date of execution of the Deed of Conditional Sale and all subsequent amortizations shall be due and payable every six (6) months
thereafter;[18]

Contrary to the ruling of the Court of Appeals that the above stipulation fails to specify the monthly amortization, we
find no ground for construing any ambiguity against the DBP as the party responsible therefor. As stipulated in the Deed
of Conditional Sale, the first amortization was in the amount of P23,126.14 to be paid six months from the date of the
execution of the contract. Subsequent amortizations were due and payable every six months thereafter. Such stipulation
cannot be construed other than that the subsequent amortizations should be in the same amount as the first, to be paid
every six months thereafter. There being no other basis for the payment of the subsequent amortizations, the reasonable
conclusion one can reach is that subsequent payments shall be made in the same amount as the first payment.
With regard to the remaining monetary obligation of the private respondents, the question is whether respondent
spouses could be held liable for the interests and penalty charges considering that they had already paid the full amount
of the principal obligation and petitioner DBP did not object to the late payments made by them.
The contract provided that “[t]he first amortization of P23,236.14 shall be due and payable six (6) months from the
date of execution of the Deed of Conditional Sale and all subsequent amortizations shall be due and payable every six (6)
months thereafter.” As the contract was executed on August 8, 1983, [19] the first amortization became due on February 8,
1994 while the next one fell due on August 8 of that year. The subsequent amortizations were to be paid every six months
thereafter, i.e., on February 8 and August 8 of the following years. Respondent spouses failed to comply with the schedule
of payment of amortizations, their payments having been actually made as follows:

OR. NO. DATE AMOUNT

261122 June 22, 1983 P 36,000.00

355399 August 4, 1983 5,400.00

828029 March 22, 1984 6,000.00

862947 June 4, 1984 21,000.00

1230133 November 15, 1984 3,000.00

1365914 Feb. 8, 1985 6,000.00

1545272 March 11, 1985 6,000.00

1549511 April 8, 1985 6,000.00

1549641 May 3, 1985 6,000.00

1714171 July 9, 1985 11,400.00

1893683 November 29, 1985 11,400.00

2257661 July 3, 1986 10,000.00

2349229 September 3, 1986 15,000.00

2529065 November 4, 1986 16,000.00

2830513 August 18, 1987 21,000.00

3342166 October 12, 1988 10,000.00

3367039 December 9, 1988 10,000.00

3367500 February 10, 1989 10,000.00

3461778 March 9, 1989 18,000.00

3532008 April 10, 1989 18,800.00

3617235 August 28, 1989 P 33,000.00

TOTAL P 289,600.00[20]

As private respondents failed to pay on time, they incurred additional interests and penalty charges which were
applied to the payments they already made, pursuant to their contract which provides in pertinent parts as follows:

8. That the sale shall be subject to penalty charges and additional interest as follows:

a) On sale accounts with amortizations (principal past due and/or regular interest) or portion thereof in arrears for thirty (30)
days or less:

i. Additional interest at the basic sale interest per annum computed on total amortizations past due, irrespective of age.

ii. No penalty charge.

b) On sale accounts with amortizations or portion thereof in arrears for more than thirty (30) days:

i. Additional interest as provided above, plus

ii. Penalty charge of 8% per annum.[21]

The payments made by respondent spouses were applied to their obligation, including interests, in the following
manner:[22]

DATE OR NUM-BER TOTAL PRINCIPAL REGULAR ADDITIO-NAL PENALTY ADVANCES/INT.

6-22-83 261122 P36,000.00 P36,000.00 ) Down- -

8-04-83 355399 5,400.00 5,400.00 ) Payment

3-22-84 828029 6,000.00 - P5,443.75 P490.35 P65.90 -

6-04-84 862947 21,000.00 10,409.95 9,460.25 645 .22 286.82 P197.76

11-15-84 230123 3,000.00 - 1,665.66 1,018.71 315.63 -

2-08-85 365914 6,000.00 - 4,837.37 804.84 357.79 -

3-11-85 1545272 6,000.00 - 5,006.03 891.28 102.69 -

4-08-85 1549510 6,000.00 - 5,103.08 697.54 199.38 -

5-03-85 1549641 6,000.00 - 5,324.97 524.97 150.06 -

7-09-85 1714171 11,400.00 4,428.85 5,514.20 1,133.31 323.94 -

11-29-85 1893683 11,000.00 - 6,352.80 3,757.49 889.91 -

7-03-86 2257661 10,000.00 - - 7,693.45 2,306.55 -

9-03-86 2349229 15,000.00 - 9,640.76 4,519.05 840.19 -

11-04-6 2529065 16,000.00 - 11,120.74 3,813.72 1,065.54 -

8-18-87 2830513 21,000.00 - - 5,664.24 5,335.76 -

10-13-88 3342166 10,000.00 - - - 10,000.00 -

12-09-88 3367039 10,000.00 - - 4,937.64 5,062.36 -

2-10-89 3367500 10,000.00 - - 8,805.08 1,194.92 -

3-10-89 3461778 18,000.00 - - 16,920.72 1,079.28 -

4-10-89 3532008 18,800.00 - 5,786.19 11,646.64 1,367.17 -

8-28-89 3617235 33,000.00 - 12,880.57 14,122.69 5,996.74 -

P289,600.00 P56,238.50 P88,136.37 P106,853.47 P38,173.90 P197.76

Hence, as of June 30, 1989, over and above their payments in the total amount of P289,600.00, respondent spouses still
owed DBP the amount of P225,855.86.[23] By August 15, 1990, this amount ballooned to P260,945.85, broken down as
follows:[24]

Amount of Loan P 207,000.00

UNMATURED OBLIGATION

Principal Matured (8-8-89)

MATURED OBLIGATION

Principal P 150,761.50

Advances 0.00

Regular Interest 57,113.73

AI on PPD & RI 37,086.71

RI on Advances 0.00

Penalty Charge 15,983.91

Sub Total 260,945.85

TOTAL OBLIGATION 260,945.85

Daily Interest on UP P 0.00

Daily Interest on PDO P 150.97

The Court of Appeals ruled:

It is to be noted that appellant did not question the tender of payment by the appellees-vendees in different amounts and on different
dates as aforestated. It did not call attention to the amortizations paid by vendees as being wrong or improper. Appellant in fact
unqualifiedly accepted the payments. This is tantamount to a waiver on its part to demand for the “correct amount of the amortization,
applying the ruling of the Supreme Court in Ocampo vs. Court of Appeals (233 SCRA 551) that the vendor’s unqualified acceptance
of payments after the expiration of the period precludes the vendor from raising the issue of late payments and constitutes a waiver of
the period. It was only after the appellees asked the appellant to execute the final Deed of Sale that the bank started to demand for
payment under its interpretation of the Deed of Conditional Sale threatening rescission thereof, otherwise. As the unqualified
acceptance of the payments constituted a waiver of the “correctness” of the amortizations, the same likewise constituted a waiver of
the ground to rescind under Art. 1592 of the Civil Code (Ocampo vs. CA, supra).

On the remaining monetary obligation of plaintiffs, we quote with favor and hereby adopt the following computation of the trial court:

“However, considering the terms of the Deed of Conditional Sale that plaintiffs must pay 18% per annum for the balance
of P165,600.00, that amount of interest is the only amount due from plaintiffs covering a period of six years, or a total
of P178,200.00. As plaintiffs had paid already a total of P289,600.00, the amount ofP165,000.00 must be deducted therefrom which
results to an overpayment of P124,000.00 on the principal. With this amount of P124,000.00 all what plaintiffs must pay will only be
the amount of P54,200.00 as interest due on the principal amount of P165,000.00.”[25]

The reliance on Ocampo v. Court of Appeals[26] is misplaced insofar as respondent court used the ruling in said case
to justify its positionthat petitioner waived “the correct amount of amortization” to be paid by private respondents. The case
of Ocampo did not involve interests to be paid by the buyer to the seller in case of late payments. That case involved a
judicial rescission made by the seller because of the first buyer’s late payments. In that case, the seller executed a
contract of sale in favor of the first buyer, stipulating therein that payments should be made in six months. The buyer failed
to pay the consideration in full within the period agreed upon. However, the seller accepted a partial payment of the
balance even if made after the expiration of the period. The buyer had her adverse claim annotated on the title of the
seller. Later, the seller sold the land to a second buyer who was able to secure a title in his name. This Court ruled in that
case that the seller was precluded from raising the issue of late payments because his unqualified acceptance of
payments after the expiration of the six-month period was a waiver of the period.The Court did not rule in that case that
acceptance of late payments was a waiver on the “correct amount of amortization” due to the seller. No mention in fact
was made by the Court in Ocampo of the interests to be paid by the buyer.
On the other hand, in this case, the interest and penalty charges to be paid by private respondents in case of delay in
payments were expressly stipulated in the Conditional Contract of Sale. Under the Civil Code, parties to a contract can
make stipulations therein provided they are not contrary to law, morals, good customs, public order or public
policy.[27] There being no question as to the validity of the Conditional Contract of Sale, the DBP correctly applied the
provision on interests and penalty charges when private respondents failed to pay on the dates agreed upon. No further
notice to private respondents had to be given to them.
The Court of Appeals likewise erred in disregarding paragraph 8 of the contract on interests and penalty charges and
concluding that the unpaid balance of private respondents was merely in the amount of P54,200.00. In determining the
amount of P54,200.00, both the trial court and respondent Court of Appeals erroneously took into account only the 18%
annual interest on the remaining balance of P165,000.00:
In computing the liability of private respondents, the trial court determined what constitutes 18% of the principal
amount of P165,600.00 and then multiplied such amount by six, the number of years the loan is to be paid, the product of
which was P178,200.00. From the payments made by private respondents in the amount of P289,600.00, the remaining
balance of P165,600.00 was deducted, which resulted in the overpayment of P124,000. This supposed overpayment
of P124,000.00 was then deducted from the amount of interest, as determined by the trial court, which is P178,200.00,
resulting in the difference of P54,200.00. This final amount of P54,200.00, decided by the trial court and affirmed by the
Court of Appeals, was the final remaining balance of private respondents. However, the computation is
erroneous. Following the method adopted by the trial court, the product of 18% of the principal amount of P165,600.00
(P29,808.00) multiplied by six is P178,848.00. Hence, from the amount of P178,848.00 must be subtracted the supposed
overpayment of P124,000.00, resulting in the difference of P54,848.00.[28]
Article 1374 of the Civil Code provides that “the various stipulations of a contract shall be interpreted together,
attributing to the doubtful ones that sense which may result from all of them taken jointly.” In the same vein, Rule 130, §11
of the Rules on Evidence states that “In the construction of an instrument where there are several provisions or
particulars, such a construction is, if possible, to be adopted as will give effect to all.” Accordingly, the annual interest of
18% must be construed together with paragraph 8 of the Deed of Conditional Sale imposing additional interests and
penalty in case of arrears in making payments. Hence, upon failure of private respondents to pay their amortizations on
the prescribed dates, they incurred interests and penalty charges at the stipulated rates. Private respondents cannot be
allowed to renege on their obligation on the ground that what they had paid was in excess of the principal obligation in the
amount of P207,000.00. Nor can private respondents demand fulfillment of petitioner’s obligation to execute a final deed
of sale and deliver the title to the land in their favor when they have not yet fully paid their principal obligation with the
accrued interests thereto. “[N]either the law nor the courts will extricate a party from an unwise or undesirable contract he
or she entered into with all the required formalities and with full awareness of its consequences.”[29]
Be that as it may, we find the interests to be excessive. It is noteworthy that the interests paid by private
respondents, which amounted to P233,361.50,[30] including therein the regular interest, additional interest, penalty charges,
and interest on advances, is more than the principal obligation in the amount of P207,000.00, which private respondents
owed. Moreover, the additional interest of 18% alone amounted to P106,853.45,[31] which is almost half of what was already
paid by private respondents.
Article 1229 of the Civil Code states that “Even if there has been no performance, the penalty may also be reduced
by the courts if it is iniquitous or unconscionable.” In Barons Marketing Corp. v. Court of Appeals,[32] the Court reduced the
25% penalty charge to cover the attorney’s fees and collection fees, which was in addition to the 12% annual interest, to
10% for being manifestly exorbitant. Likewise, inPalmares v. Court of Appeals,[33] the Court eliminated altogether the
payment of the penalty charge of 3% per month for being excessive and unwarranted under the circumstances. It ruled in
that case:

Upon the matter of penalty interest, we agree with the Court of Appeals that the economic impact of the penalty interest of three
percent (3%) per month on total amount due but unpaid should be equitably reduced. The purpose for which the penalty interest is
intended - that is, to punish the obligor - will have been sufficiently served by the effects of compounded interest. Under the
exceptional circumstances in the case at bar, e.g., the original amount loaned was only P15,000.00; partial payment of P8,600.00 was
made on due date; and the heavy (albeit still lawful) regular compensatory interest, the penalty interest stipulated in the parties’
promissory note is iniquitous and unconscionable and may be equitably reduced further by eliminating such penalty interest
altogether.[34]

In the instant case, private respondents made regular payments to petitioner DBP in compliance with their principal
obligation. They failed only to pay on the dates stipulated in the contract. This indicates the absence of bad faith on the
part of private respondents and their willingness to comply with the terms of the contract. Moreover, of their principal
obligation in the amount of P207,000.00, private respondents have already paid P289,600.00 in favor of petitioner. These
circumstances convince us of the necessity to equitably reduce the interest due to petitioner and we do so by reducing to
10% the additional interest of 18% per annum computed on total amortizations past due. The penalty charge of 8% per
annum is sufficient to cover whatever else damages petitioner may have incurred due to private respondents’ delay in
paying the amortizations, such as attorney’s fees and litigation expenses.
 Second. Petitioner contends that private respondents have not established a clear legal right so as to be entitled to
an injunction because they are still liable to pay additional interests in accordance with the contract executed between
them.[35] The contention has no merit.
In its order, dated March 8, 1990, the trial court issued a writ of preliminary injunction to prevent petitioner from
rescinding the contract with private respondents and selling the land to other interested persons. The trial court stated:

After studying the respective positions of both parties, the Court believes that plaintiffs are entitled to the writ of preliminary
injunction prayed for under Section 3 Rule 58 of the Revised Rules of Court. This is because the Court wants to thresh out the issue of
whether or not the Deed of Conditional Sale which plaintiffs contend is embodied in a contract of adhesion was really made for the
disadvantage, damage and prejudice of plaintiffs; the issue of whether or not despite the payment of P289,6000.00 by plaintiffs over
and above the stipulated consideration for the lot in the amount of P207,000.00, still entitles DBP to rescind the said Deed of
Conditional Sale and sell it to other persons. These two issues and other issues which it believes will come up as the case proceeds,
need be resolved first, before DBP is allowed to proceed with its intended rescission of the Contract and sale of the lot to other
persons, otherwise, in the event plaintiffs’ contention stand would be found meritorious and tenable, the judgment in their favor would
become moot and academic which would ultimately cause irreparable damage to them.

WHEREFORE, in view of the foregoing, let the Writ of Preliminary Injunction prayed for issue, provided plaintiffs post an injunction
bond in the amount of P200,000.00 conditional that it shall be liable together with the principals, spouses Nilo Dela Peña and
Esperanza Dela Peña, to defendant, in the event it shall be found out that plaintiffs are not entitled to the writ of preliminary injunction
prayed for.[36]

In its decision, dated March 30, 1993, the trial court declared permanent the writ of preliminary injunction issued in
favor of private respondents.[37] Its ruling was subsequently affirmed by the Court of Appeals.[38]
Two requisites are necessary if a preliminary injunction is to issue, namely: (1) the existence of a right to be
protected and (2) the facts against which the injunction is to be directed are violative of said right. [39]
As to the question whether private respondents have a right to be protected, we hold that they do. Injunction may be
resorted to for the preservation or protection of the rights of the complainant and for no other purpose during the
pendency of the principal action.[40] In the case at bar, private respondents applied for an injunction in order to prevent
petitioner DBP from rescinding the sale and selling the land to other interested buyers. They are entitled to such writ
because petitioner DBP had no right to rescind the sale and deprive them of any right of possession over the property.
In the first place, there was no substantial breach in the performance of private respondents’ obligation. Article 1191
of the Civil Code provides that “The power to rescind obligations is implied in reciprocal ones, in case one of the obligors
should not comply with what is incumbent upon him. The injured party may choose between the fulfillment and the
rescission of the obligation, with the payment of damages in either case. He may also seek rescission, even after he has
chosen fulfillment, if the latter should become impossible. . . .” Rescission of a contract will not be permitted for a slight or
casual breach, but only such substantial and fundamental breach as would defeat the very object of the parties in making
the agreement.[41] Private respondents made regular payments to petitioner DBP. Their fault consisted only of their failure
to pay the installments on the dates stipulated in the contract, for which they were charged additional interests and penalty
charges. In the second place, private respondents stopped their payments to the DBP only after they had
paid P289,600.00 because of their belief that they had already complied with their obligation to petitioner. Lastly,
notwithstanding private respondents’ delay in paying the amortizations, petitioner DBP unqualifiedly accepted the
payments made by them. Hence, petitioner lost its right to rescind the sale on the basis of such late payments. In an
analogous case, we held:

In the instant case, the sellers gave the buyers until May 1979 to pay the balance of the purchase price. After the latter failed to pay
installments due, the former made no judicial demand for rescission of the contract nor did they execute any notarial act demanding
the same, as required under Article 1592. Consequently, the buyers could lawfully make payments even after the May 1979 deadline,
as in fact they paid several installments, an act which cannot but be construed as a waiver of the right to rescind. When the sellers,
instead of availing of their right to rescind, accepted and received delayed payments of installments beyond the period stipulated, and
the buyers were in arrears, the sellers in effect waived and are now estopped from exercising said right to rescind. [42]

Private respondents, therefore, had the right to prevent the former from rescinding the sale and selling the property in
question. The first requisite had been met.
As to the second requisite, it was expressly stipulated in the contract that should rescission take place, private
respondents, as the vendees, shall waive whatever right they may have acquired over the property and that all sums of
money paid by them shall be considered and treated as rentals for the use of the property. In addition, private
respondents shall vacate the property, waiving whatever expenses they may have incurred in the property in the form of
improvement or under any concept, without any right of reimbursement. [43] Clearly, the act sought to be enjoined by the
injunction was violative of the rights that private respondents have acquired over the property. What they stood to lose in
case petitioner decides to rescind the sale is material and substantial. Not only would they forfeit all the payments they
have made in favor of petitioner, they would also lose their right of possession over the property.
There was indeed an urgent and permanent necessity for the issuance of the writ to protect private respondents’
rights over the property.
As held in one case:[44]

The controlling reason for the existence of the judicial power to issue the writ is that the court may thereby prevent a threatened or
continuous irremediable injury to some of the parties before their claims can be thoroughly investigated and advisedly adjudicated. It
is to be resorted only when there is a pressing necessity to avoid injurious consequences which cannot be remedied under any standard
of compensation.
 Had no injunction been issued petitioner would have rescinded the sale and sold the property to other parties, and
private respondents would have lost what they have paid to petitioner and any right they may have acquired over the
property even without the benefit of a trial. The complaint of respondent spouses would have been rendered moot and
academic as the property would be in possession of an innocent purchaser for value and private respondents would be
powerless to recover the same. Such a situation cannot be countenanced. Hence, we hold that both the trial court and the
Court of Appeals correctly issued the writ of preliminary injunction against petitioner.
WHEREFORE, the decision of the Court of Appeals is hereby AFFIRMED with the MODIFICATION that the
additional interest is reduced to 10% per annum computed on total amortizations past due, irrespective of age.
SO ORDERED.
Bellosillo, J., (Chairman), Quisumbing, Buena, and De Leon, Jr., JJ., concur.