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ARTICLE/TOPIC: ARTICLE 1355 Effect of lesion or inadequacy of cause CASE TITLE: PORTLAND CEMENT CO. vs.

. DUMON, 61 SCRA 218 CASE FACTS: G.R. No. L-26738, November 29, 1974 CEBU PORTLAND CEMENT COMPANY, plaintiff-appellee, vs. TERESO DUMON, defendant-appellant Direct appeal to this Court by the defendant from the decision, dated November 6, 1965, and rendered by the Court of First Instance of Manila against him in its Civil Case No. 50484 (Cebu Portland Cement Company, plaintiff, versus Tereso Dumon, defendant), and from the subsequent order, dated August 9, 1966, denying his motion for reconsideration. This is an action for a sum of money filed by the Cebu Portland Cement Company (CEPOC), plaintiff, against Tereso Dumon, defendant praying that the defendant: (1) To pay plaintiff the sum of P274, 725.00 with legal interest thereon from March 8, 1962 when the first demand of payment was made until said amount is fully paid; (2) To pay the plaintiff the sum of equivalent to 25% of the amount due and demandable as liquidated damages and P5,000 as attorneys fees and necessary expenses of litigation. (3) To pay the cost of this suit; and (4) Such other relief as this Honorable Court may deem just and equitable in the premises. That plaintiff then agreed to conduct exploration work on the claims and to pay the defendant 100,000 bags of cement as consideration for the option to purchase the said claim, as shown in the plaintiffs letter dated October 19, 1961. And that the only consideration received by defendant from plaintiff for the option granted by him is the 99,000 bags of cement sued for in the complaint in this case. ISSUE: WON lesion or inadequacy of cause does not invalidate the contract? DECISION: Yes. Wherefore, the judgment of the trial court is modified by reversing the portion thereof sentencing appellant to pay appellee P260,988.75, dismissing the complaint of plaintiff-appellee, and eliminating the award of P13,736.25 damages to defendant-appellant. No costs. RATIO DECIDENDI: That the 100,000 bags of cement in question were delivered to appellant "in consideration of the option" and that the appellant would have to return the same only after the stipulated exploration has been undertaken by appellee are more than borne out by the aforequoted evidence. In other words, with the option to purchase having been actually given to and enjoyed by appellee, on the one hand, and with the delivery of the agreed number of bags of cement (minus 100) to appellant having been actually made by appellee, there can be no question as to the mutuality of the respective prestations and compliance therewith by both parties insofar as the option is concerned. The return of the cement in consideration of the exploration is a matter entirely independent of the option and the consideration therefor. From what appears from the evidence, it was the understanding of the parties that the obligation of CEPOC to make the exploration was definite and unconditional, whereas the return of the cement was conditioned upon the completion of the exploration. Whether this was a good bargain or not is not within our province to decide. Long ago, in Vales vs. Villa, 35 Phil. 769, We already disclaimed the role of being the guardian of the interests of parties to a contract thus:

All men are presumed to be sane and normal and subject to be moved by substantially the same motives. When of age and sane, they must take care of themselves. In their relations with others in the business of life, wits, sense, intelligence, training, ability and judgment meet and clash and contest, sometimes with gain and advantage of all, sometimes to a few only, with loss and injury to others. In these contests men must depend upon themselves upon their own abilities, talents, training, sense, acumen, judgment. The fact that one may be worsted by another, of itself, furnishes no cause of complaint. One man cannot complain because another is more able, or better trained, or has better sense or judgment than he has; and when the two meet on a fair field the inferior cannot murmur if the battle goes against him. The law furnishes no protection to the inferior simply because he is inferior, any more than it protects the strong because he is strong. The law furnishes protection to both alike to one no more or less than to the other. It makes no distinction between the wise and the foolish, the great and the small, the strong and the weak. The foolish may lose all they have to the wise; but that does not mean that the law will give it back to them again. ARTICLE 1355, Except in cases specified by law, lesion or inadequacy of cause shall not invalidate a contract, unless there has been fraud, mistake, or undue influence. In this case, as reasoned by the Supreme Court, Courts cannot follow every step of ones life and extricate him from bad bargains, protect him from unwise investments, relieve him from one-sided contracts, or annul the effects of foolish acts. Courts cannot constitute themselves guardians of everyone. Courts operate not because one person has been defeated or overcome by another, but because one person has been defeated or overcome illegally. Man can do foolish things, make ridiculous contracts, use miserable judgments, and lose money on themindeed all they have in the world but not for that alone can the law intervene and restore. There must be, in addition, a violation of law, the commission of what the law knows as an actionable wrong before the courts are authorized to lay hold of the situation and remedy it.

ARTICLE/TOPIC: ARTICLE 1355 Effect of lesion or inadequacy of cause CASE TITLE: ASKAY vs. COSALAN, 46 Phil. 179 CASE FACTS: G.R. No. 21943, September 15, 1924 ASKAY, plaintiff-appellant, vs. FERNANDO A. COSALAN, defendant-appellee The plaintiff in this case is Askay, an illiterate Igorrote between 70 and 80 years of age, residing in the municipal district of Tublay, Province of Benguet, who at various times has been the owner of mining property. The defendant is Fernando A. Cosalan, the nephew by marriage of Askay, and municipal president of Tublay, who likewise has been interested along with his uncle in mining enterprises. About 1907, Askay obtained title to the Pet Kel Mineral Claim located in Tublay, Benguet. On November 23, 1914, Askay sold this claim to Cosalan. Nine years later, in 1923, Askay instituted action in the Court of First Instance of Benguet to have the sale of the Pet Kel Mineral Claim declared null, to secure possession of the mineral claim, and to obtain damages from the defendant, and following trial before Judge of First Instance George R. Harvey, judgment was rendered dismissing the compalitn and absolving the defendant from the same, with costs against the plaintiff. On being informed of the judgment of the trial court, plaintiff attacked it on two grounds: The first, the jurisdictional, and the second, formal. Both motions were denied and an appeal was perfected. ISSUE: WON Judge George R. Harvey has jurisdiction to try the case? DECISION: Yes. RATIO DECIDENDI: Act No. 3107, amendatory of Section 155 of the Administrative Code, which authorizes a Judge of First Instance to be detailed by the Secretary of Justice to temporary duty, for a period which shall in no case exceed six months, in a district or province other than his own, for the purpose of trying all kinds of cases, excepting criminal and election cases, was not in force in fifteen days after the completion of the publication of the stature in the Official Gazette, or not until August 3, 1923. Act No. 3107, its final section provided that This Act shall take effect on its approval. The said Act was approved on March 17, 1923. Therefore, that Act No. 3107 went into effect on March 17, 1923, and that it was subsequent thereto, on April 16, 1923, that Judge Harvey was authorized to hold court at Baguio, beginning with May 2, 1923, appellants argument along this line is found to be without persuasive merit. ISSUE: WON the plaintiff has established his cause of action by preponderance of the evidence? DECISION: No. The Court concludes, therefore that the complaint was properly dismissed. As a result, judgment is affirmed with costs against the appellant. RATIO DECIDENDI:

Plaintiff contends that the sale of the Pet Kel Mineral Claim was accomplished through fraud and deceit on the part of the defendant. Plaintiff may be right but in our judgment he has failed to establish his claim. Fraud must be both alleged and proved. One fact exists in plaintiffs favor, and this is the age and ignorance of the plaintiff who could be easily by the defendant, a man of greater intelligence. Another fact is the inadequacy of the consideration for the transfer which, according to the conveyance, consisted of P1 and other valuable consideration, and which, according to the oral testimony, in reality consisted of P107 in cash, a bill-fold, one sheet, one cow, and two carabaos. Gross inadequacy naturally suggest fraud is some evidence thereof, so that it may be sufficient to show it when taken in connection with other circumstances, such as ignorance or the fact that one of the parties has an advantage over the other. ARTICLE 1355, Except in cases specified by law, lesion or inadequacy of cause shall not invalidate a contract, unless there has been fraud, mistake, or undue influence. In this case, the fact that the bargain is a hard one coupled with mere inadequacy of price when both parties are in a position to form an independent judgment concerning the transaction is not sufficient ground for the cancellation of a contract. However, if the defendant induced the plaintiff to sell the land through fraud, mistake, or undue influence, the contract may be annulled. In addition, against the plaintiff and in favor of the defendant, the Court had the document itself executed in the presence of witnesses and before a notary public and filed with the mining recorder. The notary public, Nicanor Sison, and one of the attesting presence of the plaintiff, Apolonio Ramos, testified to the effect that in the presence of the plaintiff and the defendant and of the notary public and the subscribing witnesses, the deed of sale was interpreted to the plaintiff and that thereupon he placed his thumb mark on the document. Two finger print experts, Dr. Charles S. Banks and A. Simkus, have declared in depositions that the thumb mark on Exhibit is that of Askay. No less than four other witnesses testified that at various times Askay had admitted to them that he had sold that Pet Kel Mine to Fernando Cosalan. Having waited nine years from the date when the deed was executed, nine years from the time Fernando A. Cosalan started developing the mine, nine years from the time Askay himself had been deprived of the possession of the mine, and nine years permitting of a third party to obtain a contract of lease from Cosalan, how can this court overlook plaintiff's silent acquiescence in the legal rights of the defendant?

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