Delayed Delivery and Rescission Rights in Pre-Selling Condominium Contracts
The Supreme Court held that a developer's failure to deliver a pre-selling condominium unit on time entitles the buyer to a refund of payments with interest.
A buyer who faithfully pays installments for a pre-selling condominium unit and then waits years for turnover may recover everything paid — with interest — when the developer misses the agreed delivery date. That is the thrust of Megaworld Globus Asia, Inc. v. Mila S. Tanseco, G.R. No. 181206 (October 9, 2009), where the Supreme Court ruled that a developer's unexplained delay cannot be excused by a regional financial crisis, and that a notice of turnover sent nearly three years late does not cure the breach.
The contract and the missed deadline
On July 7, 1995, Megaworld Globus Asia, Inc. and Mila S. Tanseco signed a Contract to Buy and Sell covering a 224-square-meter condominium unit in "The Salcedo Park," a pre-selling project along Senator Gil Puyat Avenue, Makati City. The price was P16,802,037.32, payable in a down payment, thirty equal monthly installments, and a balance of P2,520,305.63 due on October 31, 1998 — the stipulated delivery date.
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