Practice question
A lessor grants a binding first-refusal clause in a lease. While it remains effective, the lessor sells the covered property to a third party with full knowledge of the clause, without giving the lessee the required opportunity. The lessee timely seeks appropriate relief on the matching terms. Which statement is consistent with Equatorial?
- The third party's knowledge is necessarily irrelevant and damages are the only conceivable relief
- A sale in violation of the protected right can be rescissible in the established circumstances; the remedy is not limited categorically to damages
- The lease clause automatically makes the lessee owner before any sale
- Every such sale is nonexistent without any judicial assessment
- The lessee may acquire all the lessor's unrelated land
Legal references
- Equatorial Realty Development v. Mayfair Theater, GR 106063, November 21, 1996, main decision: https://lawphil.net/judjuris/juri1996/nov1996/gr_106063_1996.html
- Riviera Filipina v. Court of Appeals, GR 117355, April 5, 2002, main decision: https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/50682
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