FACTS:

The case involves a dispute between Domingo A. Dizon and Elpidio R. Dizon over the sale of a house and lot located in Tondo, Manila. Domingo purchased the property from Elpidio, who failed to deliver the property to him. It was revealed that Elidio did not have written authority from his co-owner brother, Ricardo, to sell his half share of the property. Domingo filed a complaint for specific performance and sum of money with damages against Elpidio. The trial court eventually rendered a decision rescinding the contract of sale and ordering Elpidio to pay Domingo sums of money and attorney's fees. A writ of execution was issued, and the auction sale of Elpidio's properties was scheduled. Domingo emerged as the highest bidder at the auction sale and offered a bid of P180,000. In the afternoon of the same day, the sheriff presented a supplemental minutes of the auction sale, showing that Domingo's counsel submitted a new bid of P1,690,074.41. Elpidio refused to sign the supplemental sale, claiming that it was a new sale and he would have difficulty redeeming the property for the higher amount. Elpidio filed a motion to quash the supplemental sale, but the trial court denied it, stating that it benefitted Elpidio. Elpidio appealed to the Court of Appeals, which granted the petition and set aside the trial court's orders. The appellate court considered the supplemental sale invalid as it was made after the auction sale had been perfected. Petitioner filed a motion for reconsideration, but it was denied. Hence, the present petition before the Supreme Court.

ISSUES:

1. Whether or not the supplemental sale executed after the auction sale of the properties was valid;

2. Whether or not the trial court gravely abused its discretion in upholding the validity of the supplemental sale.

RULING:

1. The supplemental sale executed after the auction sale of the properties was not valid. The auction sale had already been perfected when the sheriff declared the petitioner as the highest bidder and it ended at 10:25 a.m. Since the auction sale was already considered perfected, a supplemental sale with a higher consideration at the instance of only one party (petitioner) could no longer be validly executed.

2. The trial court gravely abused its discretion in upholding the validity of the supplemental sale. The Court of Appeals correctly set aside the trial court's orders and declared the supplemental sale as invalid.

PRINCIPLES:

• In a sale by auction, the sale is perfected when the auctioneer announces its perfection by the fall of the hammer or in any other customary manner. Until such announcement is made, any bidder may retract his bid, and the auctioneer may withdraw the goods from the sale, unless the auction has been announced to be without reserve. (Article 1476, paragraph 2 of the Civil Code)

• A supplemental sale executed after the perfection of the auction sale, with a higher consideration at the instance of only one party, is not valid.