Professional Documents
Culture Documents
Art. 2 NCC; Art.5 Labor Code; Sec. 3(1) & 4, Ch. 2, Book VII,
Administrative Code of 1987; BSP Circular 799
Effects and application of law
Tanada vs Tuvera, 136 SCRA 27 (1985)
Article 2 of the NCC does not preclude the requirement of publication in
the Official Gazette even if the law itself provides for the date of its
effectivity.
Tanada vs Tuvera,146 SCRA 446 (1986)
If the law provides for its own effectivity date, then it takes effect on the
said date, subject to the requirement of publication. The clause unless
otherwise provided refers to the date of effectivity and not the to the
requirement of publication itself, which cannot in any event be omitted.
Basa vs M ercado, 61 Phil 632
To be a newspaper of general circulation, it is enough that it is published
for the dissemination of local news and general information, that it has
bona fide subscription list of paying subscribers, and that it is published
at regular intervals.
PASEI vs. Torres, G.R. NO. 101279,Aug. 06, 1992 212 SCRA 298
Although the questioned circulars are a valid exercise of the police power
as delegated to the executive branch of Government, they are legally
invalid, defective and unenforceable for lack of proper publication and
filing in the Office of the National Administrative Register as required in
Article 2 of the Civil Code, Article 5 of the Labor Code and Sections 3(1)
and 4, Chapter 2, Book VII of the Administrative Code of 1987
Rep. vs. Extelcom, G.R. NO. 147096,Jan. 15, 2002 373 SCRA 316
Thus, publication in the Official Gazette or a newspaper of general
circulation is a condition sine qua non before statutes, rules or
regulations can take effect. There is nothing in the Administrative Code
1
of 1987 which implies that the filing of the rules with the UP Law Center
is the operative act that gives the rules force and effect.
Cojuangco, Jr. vs. Rep., G.R. NO. 180705, Nov. 27,2012 686 SCRA
472
In this case, while it incorporated the PCA-Cojuangco AG.R.eement by
reference, Section 1 of P.D. 755 did not in any way reproduce the exact
terms of the contract in the decree. Neither was acopy thereof attached to
the decree when published. We cannot, therefore, extend to the said
AG.R.eement the status of a law.
NMSM I vs. DND,G.R. NO. 187587,June 5, 2013 697 SCRA 359
The Court cannot rely on a handwritten note that was not part of
Proclamation No. 2476 as published. Without publication, the note never
had any legal force and effect.
Roy vs CA, G.R. NO 80718 Jan. 29, 1988
The term laws do not include decisions of the Supreme Court because
lawyers in the active practice must keep abreast of decisions, particularly
where issues have been clarified, consistently reiterated and published in
advanced reports and the SCRA.
Article 8. Stare Decisis; Case Law; See also Article 36, FC; article 9,
10, 11, 12 , 13, 14 NCC
Ting v. Velez-Ting, G.R. NO. 166562, M ar. 31, 2009 582 SCRA 694
The rule of stare decisis is not inflexible, whether it shall be followed or
departed from, is a question entirely within the discretion of the court,
which is again called upon to consider a question once decided. It is only
when a prior ruling of this Court is overruled, and a different view is
adopted, that the new doctrine may have to be applied prospectively in
favor of parties who have relied on the old doctrine and have acted in
good faith, in accordance therewith under the familiar rule of "lex
prospicit, non respicit
judgment and its authenticity must be proven as facts under our rules on evidence,
together with the alien s applicable national law to show the effect of the judgment
on the alien himself or herself. The recognition may be made in an action instituted
specifically for the purpose or in another action where a party invokes the foreign
decree as an integral aspect of his claim or defense. With respect to their properties
in the Philippines, Leticia filed a petition for judicial separation of conjugal
properties. The Court ruled that the Philippine courts did not acquire jurisdiction
over the California properties of David and Leticia. Indeed, Article 16 of the Civil
Code clearly states that real property as well as personal property is subject to the
law of the country where it is situated. Thus, liquidation shall only be limited to the
Philippine properties.
NORMA A. DEL SOCORRO, for and in behalf of her minor child RODERIGO
NORJO VAN WILSEM, vs. ERNST JOHAN BRINKMAN VAN WILSEM, G.R. No.
193707 , December 10, 2014
A foreigner was sued for support. The Supreme Court ruled that Article 195 of the
New Civil Code cannot apply to him, since Article 15 of the New Civil Code stresses
the principle of nationality. Philippine laws, specifically the provisions of the Family
Code relating to support, only apply to Filipino citizens. By analogy, the same
principle applies to foreigners such that they are governed by their national law
with respect to family rights and duties. Be that as it may, the accused, who is
residing in the Philippines, was held liable under under Section 5(e) and (i) of R.A.
No. 9
for unjustly refusing or failing to give support to petitioner s son on since
respondent is currently living in the Philippines, on the basis of the Territoriality
Principle in criminal law, in relation to Article 14 of the New Civil Code, applies to
the instant case, which provides that: "[p]enal laws and those of public security and
safety shall be obligatory upon all who live and sojourn in Philippine territory,
subject to the principle of public international law and to treaty stipulations."
NORMA A. DEL SOCORRO for and in behalf of her Minor Child RODERIGO
NORJO VAN WILSEM vs. ERNST JOHAN BRINKMAN VAN WILSEM, G.R. No.
193707, December 10, 2014
Van Dorn vs. Romillo G.R. NO.L-68470 October 8, 1985 139 SCRA
139
It is true that owing to the nationality principle embodied in Article 15 of
the Civil Code, only Philippine nationals are covered by the policy against
absolute divorces the same being considered contrary to our concept of
public policy and morality. Howe ver, aliens may obtain divor ces abroad,
which may be recognized in the Philippines, provided they are valid
according to their national law.
Pilapil vs. Ibay-Somera, G.R. NO. 80116 June 30, 1989 174 SCRA
652
Whether or not, the complainant, a foreigner, qualify as an offended
spouse having obtained a final divorce decree under his national law
prior to his filing the criminal complaint. The person who initiates the
adultery case must be an offended spouse, and by this is meant that he
is still married to the accused spouse, at the time of the filing of the
complaint.
Recio vs. Recio G.R. NO. 138322. October 2, 2001 366 SCRA 437
Whether or not the divorce must be proved before it is to be recognized
in the Philippines. Before a foreign divorce decree can be recognized by
our courts, the party pleading it must prove the divorce as a fact and
demonstrate its conformity to the foreign law allowing it. Presentation
solely of the divorce decree is insufficient.
Roehr v. Rodriguez,G.R. NO. 142820 ,Jun. 30, 2003 404 SCRA 495
As a general rule, divorce decrees obtained by foreigners in other
countries are recognizable in our jurisdiction, but the legal effects
thereof, e.g. on custody, care and support of the children, must still be
determined by our courts.
Morigo v. People, G.R. NO. 145226 , Feb. 6, 2004 422 SCRA 376
6
The principle of unjust enrichment requires two conditions: (1) that a person is
benefited without a valid basis or justification, and (2) that such benefit is derived at
the expense of another.
It does not, however, apply in this case since any benefit that the spouses Manzanilla
may obtain from the subject premises cannot be said to be without any valid basis
or justification. It is well to remind Waterfields that they violated the contract of
lease and that they failed to vacate the premises upon demand. Hence, the spouses
Manzanilla are justified in recovering the physical possession thereof and
consequently, in making use of the property. Besides, in violating the lease by failing
to pay the rent, Waterfields took the risk of losing the improvements it introduced
thereon in favor of the spouses Manzanilla.
RAUL SESBRENO VS. COURT OF APPEALS, G.R. No. 160689 March 26, 2014, J.
BERSAMIN
This case concerns the claim for damages of petitioner Raul H. Sesbreo founded on abuse
of rights. Sesbreo accused the violation of contract (VOC) inspection team dispatched by
the Visayan Electric Company (VECO) to check his electric meter with conducting an
unreasonable search in his residential premises. It is worth noting that the VOC inspectors
decided to enter the main premises only after finding the meter of Sesbreo turned upside
down, hanging and its disc not rotating. Their doing so would enable them to determine the
unbilled electricity consumed by his household. The circumstances justified their decision,
and their inspection of the main premises was a continuation of the authorized entry.
Although the act is not illegal, liability for damages may arise should there be an
abuse of rights. The concept of abuse of rights prescribes that a person should not
use his right unjustly or in bad faith; otherwise, he may be liable to another who
suffers injury. There is an abuse of rights if when the act is performed without
prudence or in bad faith. In order that liability may attach under the concept of
abuse of rights, the following elements must be present, to wit: (a) the existence of a
legal right or duty, (b) which is exercised in bad faith, and (c) for the sole intent of
prejudicing or injuring another. There is no hard and fast rule that can be applied to
ascertain whether or not the principle of abuse of rights is to be invoked. The
resolution of the issue depends on the circumstances of each case.
However, Sesbreo did not persuasively demonstrate that there was an intervention
of malice or bad faith on the part of (VOC) inspection team during the inspection of
the main premises, or any excessiveness committed by them in the course of the
inspection. But Sesbreo did not. On the other hand, the CA correctly observed that
the inspection did not zero in on Sesbreo s residence because the other houses
within the area were similarly subjected to the routine inspection. The court
eliminated any notion of malice or bad faith.
WILLAWARE PRODUCTS CORPORATION vs. JESICHRIS MANUFACTURING
CORPORATION, G.R. No. 195549, September 3, 2014, J. Peralta
8
The issue for resolution is: whether or not petitioner committed acts amounting to
unfair competition under Article 28 of the Civil Code.The instant case falls unde r
Article 28 of the Civil Code on human relations, and not unfair competition under
Republic Act No. 8293, as the present suit is a damage suit and the products are not
covered by patent registration. A fortiori, the existence of patent registration is
immaterial in the present case.
The concept of "unfair competition"under Article 28 is very much broader than that
covered by intellectual property laws. Under the present article, which follows the
extended concept of "unfair competition" in American jurisdictions, the term covers
even cases of discovery of trade secrets of a competitor, bribery of his employees,
misrepresentation of all kinds, interference with the fulfillment of a competitor s
contracts, or any malicious interference with the latter s business.
CARLOS A. LORIA vs. LUDOLFO P. MUOZ, G.R. No. 187240, October 15, 2014, J.
Leonen
The principle of unjust enrichment has two conditions. First, a person must have
been benefited without a real or valid basis or justification. Second, the benefit was
derived at another person s expense or damage. )n this case, Loria received
P2,000,000.00 from Muoz for a subcontract of a government project to dredge the
Masarawag and San Francisco Rivers in Guinobatan, Albay. However, contrary to the
parties agreement, Muoz was not subcontracted for the project. Nevertheless,
Loria retained the P2,000,000.00. Thus, Loria was unjustly enriched. He retained
Muoz s money without valid basis or justification. Under Article
of the Civil
Code of the Philippines, Loria must return the P2,000,000.00 to Muoz.
DOMINGO GONZALO VS.JOHN TARNATE JR., G.R. NO. 160600, JANUARY 15,
2014, J. Bersamin
Gonzalo, who was the sole contractor of the project in question, subcontracted the
implementation of the project to Tarnate in violation of the statutory prohibition.
Their subcontract was illegal because it did not bear the approval of the DPWH
Secretary. Necessarily, the deed of assignment was also illegal, because it sprung
from the subcontract. Thus, Tarnate and Gonzalo entered into an illegal contract.
While it is true that under Article 1412 (1) of the Civil Code, the guilty parties to an
illegal contract cannot recover from one another and are not entitled to an
affirmative relief because they are in pari delicto or in equal fault, the doctrine of in
pari delicto is not always rigid.
An accepted exception arises when its application contravenes well-established
public policy. In this jurisdiction, public policy has been defined as "that principle of
the law which holds that no subject or citizen can lawfully do that which has a
tendency to be injurious to the public or against the public good."
Under the principle of unjust enrichment exists then, Gonzalo would be unjustly
enriched at the expense of Tarnate, who provided the materials, if the latter was to
be barred from recovering because of the rigid application of the doctrine of in pari
delicto. The prevention of unjust enrichment called for the exception to apply in
Tarnate s favor.
Amonoy vs Gutierrez, 351 SCRA 731 (2001)
One who merely exercises ones rights does no actionable injury and
cannot be held liable for damages.
Albenson Enterprises Corp. vs CA,217 SCRA 18 (1993)
The elements of an abuse of right under article 19are the following: 1.
There is a legal right or duty; 2. Which is exercised in bad faith; 3. For
the sole intent of prejudicing or injuring another.
RCPI vs CA, 143 SCRA 657 (1986)
Dionela filed a complaint for damages against RCPI alleging that the
defamatory words on the telegram sent to him not only wounded his
feelings but also caused him undue embarrassment and affected his
business as well as because other people have come to know of said
defamatory words. There is a clear case of breach of contract by the
petitioner in adding extraneous and libelous matters in the message se nt
to Dionela.
Constantino vs M endez 209 SCRA 18 (1992)
Mere sexual intercourse is not by itself a basis for recovery. Damages
could only be awarded if sexual intercourse is not a product of
voluntariness and mutual desire.
10
UP v. Philab, G.R. NO. 152411, Sept. 29, 2004 439 SCRA 467
Whether or not UP is liable to pay PHILAB considering that it is only a
donee of FEMF, FEMF being the one which funded the project, and
despite being a donee, unjust enrichment still applies to UP. In order
that accion in rem verso may prosper, the essential elements must be
present: (1) that the defendant has been enriched, (2) that the plaintiff
has suffered a loss, (3) that the enrichment of the defendant is without
just or legal ground, and (4) that the plaintiff has no other action
based on contract, quasi-contract, crime or quasi-delict.
Beumer vs. Amores, G.R. NO. 195670, Dec. 03, 2012 686 SCRA 770
An action for recovery of what has been paid without just cause has been
designated as an accion in rem verso. This provision does not apply if, as
11
Padalhin vs. Lavia, G.R. NO. 183026,Nov. 14, 2012 685 SCRA 549
Nestor himself admitted that he caused the taking of the pictures of
Lavina's residence without the latter's knowledge and consent. Nestor
violated the New Civil Code prescriptions concerning the privacy of one's
residence and he cannot hide behind the cloak of his supposed
benevolent intentions to justify the invasion.
Civil Personality; Birth; Death; Arts 37, 38, 39 40, 41, 42; 390, 391,
712, 777 NCC; Art. 41, 96 &124, 99 & 126, 142 FC
12
13
Marriage Ceremony
Morigo vs People, 422 SCRA 376 (2004)
Petitioner and Lucia Barrette merely signed the marriage contract on
their own. The mere act of signing a marriage contract by the contracting
parties without the presence of the solemnizing officer will not result to
marriage.
Infante vs Arenas, June 29, 1951
The failure of the solemnizing officer to ask the parties whether they take
each other as husband and wife cannot be regarded as a fatal omission if
the parties nonetheless signed the marriage contract in the presence of
the solemnizing officer. A declaration of word of mouth of what the
parties and already stated in writing would be a mere repetition, so that
its omission should not be regarded as fatal.
People v. Opea, L-34954, Feb. 20, 1981
If a man and a woman deport themselves as if they were husband and
wife, they are presumed to be validly and legally married to each other
and this presumption is not rebutted by a mere denial by the man (or
woman) of the fact of marriage.
17
18
Atty. Luna s subsequent marriage to Soledad was void for being bigamous, on the
ground that the marriage between Atty. Luna and Eugenia had not been dissolved
by the Divorce Decree rendered by the CFI of Sto. Domingo in the Dominican
Republic but had subsisted until the death of Atty. Luna
Given the subsistence of the first marriage between Atty. Luna and Eugenia, the
presumption that Atty. Luna acquired the properties out of his own personal funds
and effort remained. It should then be justly concluded that the properties in litis
legally pertained to their conjugal partnership of gains as of the time of his death.
Consequently, the sole ownership of the 25/100 pro indiviso share of Atty. Luna in
the condominium unit, and of the law books pertained to the respondents as the
lawful heirs of Atty. Luna.
EDELINA T. ANDO vs. DEPARTMENT OF FOREIGN AFFAIRS, G.R. No.
195432, August 27, 2014, CJ. Sereno
Petitioner questions the decision of the RTC, dismissing her petition for the
recognition of her second marriage as valid, for failing to comply with the
requirements set forth in Art. 13 of the Family Code that is obtaining a judicial
recognition of the foreign decree of absolute divorce in our country. The SC however
ruled that a divorce obtained abroad by an alien may be recognized in our
jurisdiction, provided the decree is valid according to the national law of the
foreigner. The presentation solely of the divorce decree is insufficient; both the
divorce decree and the governing personal law of the alien spouse who obtained the
divorce must be proven. Because our courts do not take judicial notice of foreign
laws and judgment, our law on evidence requires that both the divorce decree and
the national law of the alien must be alleged and proven and like any other fact.
Hence, instead of filing a petition for the recognition of her second marriage as valid,
petitioner should have filed a petition for the judicial recognition of her foreign
divorce from her first husband.
EDELINA T. ANDO v DEPARTMENT OF FOREIGN AFFAIRS, G.R No. 195432
August 27, 2014. J. SERENO
Edelina Tungol married a Japanese man, Yuichiro Kobayashi, in 2001. In 2004,
Kobayashi obtained a divorce valid under Japanese law. Believing the divorce
capacitated her to marry, Edelina married Masatomi Ando in 2005. When Edelina
applied for a renewal of her passport using Ando s last name, the DFA told her that
she needed to prove by a competent court decision that her second marriage to
Ando is valid until otherwise declared.
There appears to be insufficient proof or evidence presented on record of both the
national law of her first husband, Kobayashi, and of the validity of the divorce
decree under that national law. Hence, any declaration as to the validity of the
divorce can only be made upon her complete submission of evidence proving the
19
divorce decree and the national law of her alien spouse, in an action instituted in the
proper forum.
Rep. v. Orbecido, G.R. NO. 154380, Oct. 05, 2005 472 SCRA 114
Whether or not, a Filipino spouse of an alien, who is a Filipino at the
time of marriage, remarry after the latter acquires a foreign divorce that
allows her to remarry. The reckoning point is not the citizenship of the
parties at the time of the celebration of the marriage, but their
citizenship at the time a valid divorce is obtained abroad by the alien
spouse capacitating the latter to remarry.
Corpuz v. Sto. Tomas, G.R. NO. 186571, Aug. 11, 2010 628 SCRA
266
A judgment of divorce is a judicial decree, although a foreign one,
affecting a persons legal capacity and status that must be recorded. But
while the law requires the entry of the divorce decree in the civil registry,
the law and the submission of the decree by themselves do not ipso facto
authorize the decrees registration.
Classification of M arriages, Relationships. Parties In
NCC;FC;AM 02-11-10 SC
Interest;
Valid
Voidable
Void
Terminable
Others Classifications
Legal Separation
Separation in Fact
Common Law Relationship
Void M arriages vs Voidable M arriages
Suntay vs. Conjuangco-Suntay, 300 SCRA 760, 770 (1998)
The fundamental distinction between void and voidable marriages is that
a void marriage is deemed never to have taken place at all and cannot be
the source of rights. On the other hand, a voidable marriage, is
considered valid and produces all its civil effects, until it is set aside by
final judgment of a competent court in an action for annulment
20
21
Article 36, FC; AM 02-11-10 SC; See also Articles 48, 68-71, 220-221
& 225 FC
Psychological Incapacity Definition
Salita vs Hon. M agtolis ,June 13, 1994
The Committee did not give any examples of psychological incapacity for
fear that the giving of examples would limit the applicability of the
provision under the principle of ejusdem generis. Rather, the Committee
would like the judge to interpret the provision on a case-to-case basis,
guided by experience, the findings of experts and researchers in
psychological disciplines, and by decisions of church tribunals which,
although not binding on the civil courts, may be given persuasive effect
since the provision was taken from Canon Law.
Characteristics of Psychological Incapacity
Santos v. Court of Appeals, 240 SCRA 20 (1995)
The Supreme Court enumerated the three basic requirements of
psychological incapacity as a ground for declaration of nullity of the
marriage: (a) gravity; (b) juridical antecedence; and (c) incurability.
Guidelines in the interpretation and application of Article 36; AM
02-11-10 SC
VALERIO E. KALAW vs. MA. ELENA FERNANDEZ, G.R. No. 166357, January 14,
2015, J. Del Castillo
On reconsideration, the Supreme Court reversed its previous ruling and reinstated
the trial court s ruling granting the petition for nullity on the basis of Art. 36.
Psychological incapacity is the downright incapacity or inability to take cogniza nce
of and to assume the basic marital obligations. The burden of proving psychological
incapacity is on the plaintiff. The plaintiff must prove that the incapacitated party,
based on his or her actions or behavior, suffers a serious psychological disorder that
completely disables him or her from understanding and discharging the essential
obligations of the marital state. The psychological problem must be grave, must
have existed at the time of marriage, and must be incurable.
The courts are justified in declaring a marriage null and void under Article 36 o f the
Family Code regardless of whether it is the petitioner or the respondent who
imputes the psychological incapacity to the other as long as the imputation is fully
substantiated with proof. Indeed, psychological incapacity may exist in one party
alone or in both of them, and if psychological incapacity of either or both is
established, the marriage has to be deemed null and void.
22
23
Marable v. M arable G.R. NO. 178741, Jan. 17, 2011 639 SCRA 557
The appellate court correctly ruled that the report of Dr. Tayag failed to
explain the root cause of petitioners alleged psychological incapacity.
The evaluation of Dr. Tayag merely made a general conclusion that
petitioner is suffering from an Anti-social Personality Disorder but there
was no factual basis stated for the finding that petitioner is a socially
deviant person, rebellious, impulsive, self-centered and deceitful.
Ochosa v. Alano, G.R. NO. 167459 , Jan. 26, 2011 640 SCRA 517
In this case the court proved that respondent was the sex partner of
many military officials. In view of the foregoing, the badges of Bona s
alleged psychological incapacity, i.e., her sexual infidelity and
abandonment, can only be convincingly traced to the period of time after
her marriage to Jose and not to the inception of the said marriage.
Yambao v. REP., G.R. NO. 184063 , Jan. 24, 2011 640 SCRA 355
Article 36 contemplates incapacity or inability to take cognizance of
and to assume basic marital obligations and not merely difficulty,
refusal, or neglect in the performance of marital obligations or ill will.
Rep. v. Galang G.R. NO. 168335 , Jun. 6, 2011 650 SCRA 524
In like manner, Juvys acts of falsifying the respondents signature to
encash a check, of stealing the respondents ATM, and of squandering a
huge portion of the P15,000.00 that the respondent entrusted to her,
while no doubt reprehensible, cannot automatically be equated with a
psychological disorder, especially when the evidence shows that these
were mere isolated incidents and not recurring acts.
Aurelio v. Aurelio, G.R. NO. 175367 , Jun. 6, 2011 650 SCRA 561
Whether or not a petition for nullity of marriage on the ground of
psychological incapacity may be dismiss for failure to comply with the
guidelines set forth in the Molina Ruling. Let it be remembered that each
case involving the application of Article 36 must be treated distinctly and
judged not on the basis of a priori assumptions, predilections or
generalizations but according to its own attendant facts.
Kalaw v. Fernandez, G.R. NO. 166357 , Sept 19, 2011 657 SCRA 822
24
opinion for that purpose. Expert e vidence submitted here did not
establish the precise cause of the supposed psychological incapacity of
Dominic, much less show that the psychological incapacity existed at the
inception of the marriage.
Republic v. Encelan, G.R. NO. 170022 , Jan. 9, 2013 688 SCRA 215
In any event, sexual infidelity and abandonment of the conjugal dwelling,
even if true, do not necessarily constitute psychological incapacity; these
are simply grounds for legal separation. To constitute psychological
incapacity, it must be shown that the unfaithfulness and abandonment
are manifestations of a disordered personality that completely prevented
the erring spouse from discharging the essential marital obligations.
Evidentiary requirement
GLENN VIAS vs. MARY GRACE PAREL-VIAS, G.R. No. 208790, January 21,
2015, J. Reyes
The lack of personal examination or assessment by a psychologist or psychiatrist is
not necessarily fatal in a petition for the declaration of nullity of marriage. If the
totality of evidence presented is enough to sustain a finding of psychological
incapacity, then actual medical examination of the person concerned need not be
resorted to. In the case at bar, the assessment of the psychological incapacity of the
wife was based solely on the information provided by the husband whose bias in
favor of his cause cannot be doubted. While this circumstance alone does not
disqualify the psychologist for reasons of bias, her report, testimony and
conclusions deserve the application of a more rigid and stringent set of standards.
Hence, if the totality of the evidence presented provides inadequate basis to warrant
the conclusion that a psychological incapacity existed that prevented her from
complying with the essential obligations of marriage, the declaration of the nullity of
the marriage cannot be obtained. It has been settled that irreconcilable differences,
sexual infidelity or perversion, emotional immaturity and irresponsibility, and the
like, do not by themselves warrant a finding of psychological incapacity under
Article 36, as the same may only be due to a person s refusal or unwillingness to
assume the essential obligations of marriage and not due to some psychological
illness that is contemplated by said rule.
Ablaza v. Republic, G.R. NO. 158298 , Aug. 11, 2010 628 SCRA 27
Other than for purposes of remarriage, no judicial action is necessary to
declare a marriage an absolute nullity. For other purposes, such as but
not limited to determination of heirship, legitimacy or illegitimacy of a
child, settlement of estate, dissolution of property regime, or a criminal
case for that matter, the court may pass upon the validity of marriage
even in a suit not directly instituted to question the same so long as it is
essential to the determination of the case.
Atienza vs. Brillantes, Jr., 243 SCRA 32,35 (1995)
Article 40 is applicable to remarriages entered into after the effectivity of
the Family Code on August 3, 1988 regardless of the date of the first
marriage.
Mercado vs. Tan, 337 SCRA 122 (2000)
27
29
Rep. v. Tango, G.R. NO.161062 , Jul. 31, 2009 594 SCRA 560
By express provision of law, the judgment of the court in a summary
proceeding shall be immediately final and executory. As a matter of
course, it follows that no appeal can be had of the trial courts judgment
in a summary proceeding for the declaration of presumptive death of an
absent spouse under Article 41 of the Family Code
Navarro v. Domogtoy, A.M . NO.M TJ-96-1088, Jul. 19, 1996 259
SCRA 129
Even if the spouse present has a well-founded belief that the absent
spouse was already dead, a summary proceeding for the declaration of
presumptive death is necessary in order to contract a subsequent
marriage, a mandatory requirement which has been precisely
incorporated into the Family Code to discourage subsequent marriages
where it is not proven that the previous marriage has been dissolved or a
missing spouse is factually or presumptively dead, in accordance with
pertinent provisions of law.
Rep. v. Bermudez-Lorino, G.R. NO. 160258 , Jan. 19, 2005 449
SCRA 57
Although the result of the Court of Appeals denial of the appeal would
apparently be the same, there is a big difference between having the
supposed appeal dismissed for lack of jurisdiction by virtue of the fact
that the RTC decision sought to be appealed is immediately final and
executory, and the denial of the appeal for lack of merit. In the former,
the supposed appellee can immediately ask for the issuance of an Entry
30
of Judgment in the RTC, whereas, in the latter, the appellant can still
raise the matter to this Court on petition for review and the RTC
judgment cannot be executed until this Court makes the final
pronouncement.
Rep. v. Granada, G.R. NO. 187512, June 13, 2012 672 SCRA 432
As a matter of course, it follows that no appeal can be had of the trial
court's judgment in a summary proceeding for the declaration of
presumptive death of an absent spouse under Article 41 of the Family
Code. It goes without saying, however, that an aggrieved party may file a
petition for certiorari to question abuse of discretion amounting to lack of
jurisdiction.
Terminable M arriage; Art. 43 44 FC
Effects of termination of subsequent marriage
Effects of Bad Faith
Armas v. Calisterio, G.R. NO.136467, Apr. 06, 2000 330 SCRA 201
Bad faith imports a dishonest purpose or some moral obliquity and
conscious doing of wrong it partakes of the nature of fraud, a breach of a
known duty through some motive of interest or ill-will.
Voidable M arriages; Art. 45- 49 FC
Definition
Suntay vs. Cojuangco-Suntay, 300 SCRA 760, 771 (1998)
A voidable marriage is considered valid and produces all its civil effects
until it is set aside by final judgment of a competent court in an action
for annulment. The terms annul and null and void have different legal
connotations and implications. Annul means to reduce to nothing; to
nullify; to abolish; to do away with; whereas, null and void is something
that does not exist from the beginning.
Characteristics of Voidable M arriages
Proper party to file annulment of M arriage
G.R.ounds
Ratification and prescription
Procedural rules of annulment of marriage and declaration of nullity
31
Marital rights including coverture and living in conjugal dwelling may not
be enforced by the extra-ordinary writ of habeas corpus. With his full
mental capacity coupled with the right of choice, Potenciano Ilusorio may
not be the subject of visitation rights against his free choice. Otherwise,
we will deprive him of his right to privacy.
Go vs. CA G.R. NO.114791, M ay 29, 1997 272 SCRA 752
Under Article 117 of the Civil Code (now Article 73 of the Family Code),
the wife may exercise any profession, occupation or engage in business
without the consent of the husband. In the instant case, we are
convinced that it was only petitioner Nancy Go who entered into the
contract with private respondent.
Family expenses and management of the household
TITLE IV. PROPERTY RELATIONS BET. HUSBAND & W IFE (Articles
74- 148)
CHAPTER 1. GENERAL PROVISIONS;
(Articles 74-81, FC; Art. 119, NCC)
Pre-nuptial
Agreement;
Concept
Property regime by default
Marriage settlement
Parties to M arriage settlement
Laws governing Property Relations
CHAPTER 2. DONATIONS BY REASON OF M ARRIAGE (Articles 82 87)
Donation Propter Nuptias
Serrano vs. Solomon, G.R. NO. L-12093, June 29, 1959
The following donations are not donations propter nuptias: (1) those made
in favor of the spouses after the celebration of marriage; (2) those
executed in favor of the future spouses but not in consideration of the
marriage; and (3) those Ggranted to persons other than the spouses even
though they may be founded on the marriage
Rules governing Donation propter nuptias
Heirs of Segunda M aningding vs. CA, 276 SCRA 601 (1997)
34
Even if the donation proper nuptias is void for failure to comply with
formal requisites, it could still constitute as legal basis for adverse
possession.
Valencia v. Locquiao, G.R. NO. 122134, Oct. 3, 200 412 SCRA 600
Under the Old Civil Code, donations propter nuptias must be made in a
public instrument in which the property donated must be specifically
described. However, Article 1330 of the same Code provides that
"acceptance is not necessary to the validity of such gifts". In
other words, the celebration of the marriage between the beneficiary
couple, in tandem with compliance with the prescribed form, was enough
to effectuate the donation propter nuptias under the Old Civil Code.
Donation between the parties
Donation of future properties
Revocation of Donation Propter Nuptias
Donation between Spouses
Agapay vs. Palang, G.R. NO. 116668 , Jul. 28, 1997 276 SCRA 340
Article 87 of the Family Code expressly provides that the prohibition
against donations between spouses now applies to donations between
persons living together as husband and wife without a valid marriage, for
otherwise, the condition of those who incurred guilt would turn out to be
better than those in legal union.
Arcaba vs. Batocael, G.R. NO.146683 , Nov.22, 2001 370 SCRA 414
Respondents having proven by a preponderance of evidence that Cirila
and Francisco lived together as husband and wife without a valid
marriage, the inescapable conclusion is that the donation made by
Francisco in favor of Cirila is void under Art. 87 of the Family Code.
CHAPTER 3. SYSTEM OF ABSOLUTE COMMUNITY (Articles 88-104);
R.A. 8369
Section 1. General Provisions (Articles 88-90)
Section 2. W hat constitutes Community Property (Articles 91-93)
Section 3. Charges Upon & Obligations of the Absolute Community
(Articles 94-95)
35
36
Concept
Homeowners Savings & Loan Bank vs. Dailo, 453 SCRA 283, 290
(2005)
The regime of conjugal partnership of gains is a special type of
partnership, where the husband and wife place in a common fund the
proceeds, products, fruits and income from their separate properties and
those acquired by either or both spouses through their efforts or by
chance.
Rules governing CPG
Commencement of CPG
Prohibition on waiver of Rights, Interest, Shares and Effects
Quiao vs. Quiao G.R. NO. 176556 , July 4, 2012 675 SCRA 642
In this provision, net profits "shall be the increase in value between the
market value of the community property at the time of the celebration of
the marriage and the market value at the time of its dissolution."
General Provisions
FRANCISCO LIM vs. EQUITABLE PCI BANK, now known as the BANCO DE ORO
UNIBANK INC., January 15, 2014, J. del Castillo
All property of the marriage is presumed to be conjugal, unless it is shown that it is
owned exclusively by the husband or the wife; that this presumption is not
overcome by the fact that the property is registered in the name of the husband or
the wife alone 2and that the consent of both spouses is required before a conjugal
property may be mortgaged. However, we find it iniquitous to apply the foregoing
presumption especially since the nature of the mortgaged property was never
raised as an issue before the RTC, the CA, and even before this Court. In fact,
petitioner never alleged in his Complaint that the said property was conjugal in
nature.
PHILIPPINE NATIONAL BANK v JOSE GARCIA and CHILDREN NORA GARCIA,
JOSE GARCIA, JR., BOBBY GARCIA and JIMMY GARCIA and HEIRS OF ROGELIO
GARCIA NAMELY: CELEDONIO GARCIA, DANILO GARCIA, ELSA GARCIA, FERMIN
GARCIA, HEHERSON GARCIA, GREGORIO GARCIA, IMELDA GARCIA and JANE
GARCIA, G.R No. 182839, June 2, 2014 J. BRION
37
Registration of a property alone in the name of one spo use does not destroy its
conjugal nature. What is material is the time when the property was acquired. The
registration of the property is not conclusive evidence of the exclusive ownership of
the husband or the wife. Although the property appears to be registered in the name
of the husband, it has the inherent character of conjugal property if it was acquired
for valuable consideration during marriage. In order to rebut the presumptive
conjugal nature of the property, the petitioner must present strong, clear and
convincing evidence of exclusive ownership of one of the spouses. The burden of
proving that the property belongs exclusively to the wife or to the husband rests
upon the party asserting it.
Dewara v. Lamela G.R. NO. 179010, Apr. 11, 2011 647 SCR A 483
All property of the marriage is presumed to belong to the conjugal
partnership, unless it be proved that it pertains exclusively to the
husband or to the wife. Registration in the name of the husband or the
wife alone does not destroy this presumption.
De Leon v. De Leon G.R. NO. 185063 , Jul. 23, 2009 593 SCRA 768
In the case at bar, ownership over what was once a PHHC lot and
covered by the PHHC-Bonifacio Conditional Contract to Sell was only
transferred during the marriage of Bonifacio and Anita. Evidently, title to
the property in question only passed to Bonifacio after he had fully paid
the purchase price on June 22, 1970.
Section 2. Exclusive Property of Each Spouse (Articles 109-115)
Villegas v. Lingan G.R. NO. 153839 , Jun. 29, 2007 526 SCRA 63
Consequently, as correctly held by the CA, Marilou acquired ownership
of the subject property. All rights and title of the judgment obligor are
transferred upon the expiration of the right of redemption. And where the
redemption is made under a property regime governed by the conjugal
partnership of gains, Article 109 of the Family Code provides that
property acquired by right of redemption is the exclusive property of the
spouses redeeming the property.
38
For the presumption to apply, it is not e ven necessary to prove that the
property was acquired with funds of the partnership. In fact, e ven when
the manner in which the property was acquired does not appear, the
presumption applies and it will be considered conjugal property.
Imani v. MBTC, G.R. NO.187023,Nov. 17, 2010 635 SCRA 357
The party who invokes it must first prove that the property was acquired
during the marriage. Proof of acquisition during the coverture is a
condition sine qua non to the operation of the presumption in favor of
the conjugal partnership.
Pisuea vs. Heirs of Petra Unating, G.R. NO. 132803 , Aug. 31, 1999
313 SCRA 384
The words "married to" were merely descriptive of Petra Unating's status
at the time the lot was awarded and registered in her name. Since Petra
Unating did not leave any other property, will or debt upon her demise in
1948, the property in question was thus inherited by her children, Felix
and Catalina Villar; and her husband, Aquilino Villar.
Improvement on Separate Property
Determination of Ownership
Ferrer v. Ferrer, G.R. NO.166496 , Nov. 29, 2006 508 SCRA 570
The obligation to reimburse rests on the spouse upon whom ownership
of the entire property is vested. There is no obligation on the part of the
purchaser of the property, in case the property is sold by the ownerspouse.
Section 4.Charges Upon & Oblig.of the Conjugal Partnership (Articles
121-123)
Alipio vs. Court of Appeals, G.R. NO. 134100, Sept. 29, 2000.
A creditor cannot sue the surviving spouse of a decedent in an ordinary
proceeding for the collection of a sum of money chargeable against the
conjugal partnership and that the proper remedy is for him to file a claim
in the settlement of estate of the decedent.
Homeowners Savings & Loan Bank vs. Dailo, 453 SCRA 283 (2005)
39
The burden of proof that the debt was contracted for the benefit of the
conjugal partnership of gains lies with the creditor-party litigant claiming
as such.
Ayala Investment & Development Corp. vs. Court of Appeals, 286
SCRA 272 (1998)
Where the husband contracts obligations on behalf of the family
business, the law presumes, and rightly so, that such obligation will
redound to the benefit of the conjugal partnership.
Ching vs. CA, G.R. NO. 124642 , Feb. 23, 2004 423 SCRA 356
The barefaced fact that the shares of stocks were registered in the
corporate books of Citycorp Investment Philippines solely in the name of
the petitioner-husband does not constitute proof that the petitionerhusband, not the conjugal partnership, owned the same.
Carlos vs. Abelardo, G.R. NO. 146504 , Apr. 09, 2002 380 SCRA 361
On the same principle, acknowledgment of the loan made by the
defendant-wife binds the conjugal partnership since its proceeds
redounded to the benefit of the family. Hence, defendant-husband and
defendant-wife are jointly and severally liable in the payment of the loan.
SBTC v. M ar Tierra Corp., G.R. NO. 143382 , Nov. 29, 2006 508
SCRA 419
To hold the conjugal partnership liable for an obligation pertaining to the
husband alone defeats the objective of the Civil Code to protect the
solidarity and well being of the family as a unit. The underlying concern
of the law is the conservation of the conjugal partnership. Hence, it limits
the liability of the conjugal partnership only to debts and obligations
contracted by the husband for the benefit of the conjugal partnership.
Ros v. PNB Laoag Br., G.R. NO.170166, Apr. 06, 2011 647 SCRA 334
It is enough that the benefit to the family is apparent at the signing of
the contract. From the very nature of the contract of loan or services, the
family stands to benefit from the loan facility or services to be rendered
to the business or profession of the husband.
40
Pana v. Heirs of Jose Juanite G.R. NO. 164201,Dec. 10, 2012 687
SCRA 414
Contrary to Efrens contention, Article 121 above allows payment of the
criminal indemnities imposed on his wife, Melecia, out of the partnership
assets even before these are liquidated. Indeed, it states that such
indemnities "may be enforced against the partnership assets after the
responsibilities enumerated in the preceding article have been covered."
No prior liquidation of those assets is required.
41
Tinitigan vs. Tinitigan, Sr., NO. L- 45418, October 30, 1980, 100
SCRA 619.
A husband may sell property belonging to the conjugal partnership even
without the consent of the wife if the sale is necessary to answer for a big
conjugal liability which might endanger the familys economic standing.
This is one instance where the wifes consent is not required and,
impliedly, no judicial intervention is necessary.
Spouses Guiang vs. Court of Appeals, G.R. No. 125172. June 26,
1998,
Under the Civil Code, the encumbrance or alienation of a conjugal real
property by the husband absent the wifes consent, is voidable and not
void.
Roxas vs. CA G.R. NO. 92245, Jun. 26, 1991 198 SCRA 541
The joinder of the wife, although unnecessary for an oral lease of
conjugal realty which does not exceed one year in duration, is required in
a lease of conjugal realty for a period of more than one year, such a lease
being considered a conveyance and encumbrance within the provisions
of the Civil Code requiring the joinder of the wife in the instrument by
which real property is conveyed or encumbered
Guiang vs. CA, G.R. NO. 125172, Jun. 26, 1998 291 SCRA 372
The sale of a conjugal property requires the consent of both the husband
and the wife. The absence of the consent of one renders the sale null and
void, while the vitiation thereof makes it merely voidable. Only in the
latter case can ratification cure the defect.
Jader-M analo vs. Camaisa, G.R. NO. 147978, Jan. 23, 2002 374
SCRA 498
Respondent Norma Camaisa admittedly did not give her written consent
to the sale. Even G.R.anting that respondent Norma actively participated
in negotiating for the sale of the subject properties, which she denied,
her written consent to the sale is required by law for its validity.
42
43
After the marriage of petitioner and respondent has been declared void, petitioner
filed a complaint for the partition of the house and lot obtained by them during their
marriage. The SC ruled that what governs them is Art. 147 of the Family Code. Under
this article, property acquired by both spouses through their work and industry
shall be governed by the rules on equal co-ownership. Any property acquired during
the union is prima facie presumed to have been obtained through their joint efforts.
A party who did not participate in the acquisition of the property shall be
considered as having contributed to the same jointly if said party's efforts consisted
in the care and maintenance of the family household. Efforts in the care and
maintenance of the family and household are regarded as contributions to the
acquisition of common property by one who has no salary or income or work or
industry. In the case at bar since the former spouses both agreed that they acquired
the subject property during the subsistence of their marriage, it shall be presumed
to have been obtained by their joint efforts, work or industry, thus, the property is
jointly owned by them in equal shares. MARIETTA N. BARRIDO vs. LEONARDO V.
NONATO, G.R. No. 176492, October 20, 2014, J. Peralta
MBTC v. Pascual, G.R. NO. 163744, Feb. 29, 2008 547 SCRA 246
Termination of Conjugal Property Regime does not ipso facto End the
Nature of Conjugal Ownership. While the declared nullity of marriage of
Nicholson and Florencia severed their marital bond and dissolved the
conjugal partnership, the character of the properties acquired before
such declaration continues to subsist as conjugal properties until and
after the liquidation and partition of the partnership.
Dio v. Dio, G.R. NO. 178044, Jan. 19, 2011 640 SCRA 178
The trial court erred in ordering that a decree of absolute nullity of
marriage shall be issued only after liquidation, partition and distribution
of the parties properties under Article 147 of the Family Code. The ruling
has no basis because Section 19(1) of the Rule does not apply to cases
governed under Articles 147 and 148 of the Family Code.
Espinosa v. Omaa, AC. 9081, Oct 12, 2011 659 SCRA 1
Extrajudicial dissolution of the conjugal partnership without judicial
approval is void. The Court has also ruled that a notary public should
not facilitate the disintegration of a marriage and the family by
encouraging the separation of the spouses and extrajudicially dissolving
the conjugal partnership, which is exactly what Omaa did in this case.
The "Kasunduan Ng Paghihiwalay" has no legal effect and is against
public policy.
44
45
whether the parties have the right to freely divide among themselves the
subject properties. Moreover, to follow petitioners argument would be to
allow respondent not only to admit against his own interest but that of
his legal spouse as well, who may also be lawfully entitled co-ownership
over the said properties.
Cario v. Cario, G.R. NO. 132529, Feb. 02, 2001 351 SCRA 127
As to the property regime of petitioner Susan Nicdao and the deceased,
Article 147 of the Family Code governs. This article applies to unions of
parties who are legally capacitated and not barred by any impediment to
contract marriage, but whose marriage is nonetheless void for other
reasons, like the absence of a marriage license
San Luis v. San Luis G.R. NO. 133743, Feb. 06, 2007 514 SCRA 294
In the instant case, respondent would qualify as an interested person
who has a direct interest in the estate of Felicisimo by virtue of their
cohabitation, the existence of which was not denied by petitioners. If she
proves the validity of the divorce and Felicisimos capacity to remarry,
but fails to prove that her marriage with him was validly performed
under the laws of the U.S.A., then she may be conside red as a co-owner
under Article 144 76 of the Civil Code
47
Arriola v. Arriola, G.R. NO. 177703, Jan. 28, 2008 542 SCRA 666
Furthermore, Articles 152 and 153 specifically extend the scope of the
family home not just to the dwelling structure in which the family resides
48
but also to the lot on which it stands. Thus, applying these concepts, the
subject house as well as the specific portion of the subject land on which
it stands are deemed constituted as a family home by the deceased and
petitioner Vilma from the moment they began occupying the same as a
family residence 20 years back
Modequillo vs. Breva, G.R. No. 86355, M ay 31, 1990.
There is no need to constitute the same judicially or extrajudicially as
required in the Civil Code. If the family actually resides in the premises,
it is, therefore, a family home as contemplated by law
Patricio vs. Dario, G.R. NO. 170829, November 20, 2006.
Three requisites must concur before a minor beneficiary is entitled to the
benefits of Art. 159: (1) the relationship enumerated in Art. 154 of the
Family Code; (2) they live in the family home, and (3) they are dependent
for legal support upon the head of the family.
Cabang v. Basay, G.R. NO. 180587, M ar. 20, 2009 582 SCRA 172
The family home must be established on the properties of (a) the absolute
community, or (b) the conjugal partnership, or (c) the exclusive property
of either spouse with the consent of the other. It cannot be established
on property held in co-ownership with third persons. However, it can be
established partly on community property, or conjugal property and
partly on the exclusive property of either spouse with the consent of the
latter.
Olivia De M esa v. Acero, G.R. NO. 185064 Jan. 16, 2012 663 SCRA
40
The family homes exemption from execution must be set up and proved
to the Sheriff before the sale of the property at public auction. The
petitioners now are barred from raising the same. Failure to do so estop
them from later claiming the said exemption.
Manacop vs. CA, 277 SCRA 57 (1997)
Articles 152 and 153 of the Family Code do not have a retroactive effect
such that all existing family residences are deemed to have been
constituted as family homes at the time of their occupation prior to the
effectivity of the Family Code and are exempt from execution for the
payment of obligations incurred before the effectivity of the Family Code.
49
Benitez-Badua vs. CA G.R. NO. 105625, Jan. 24, 1994 229 SCRA 468
Article 170 of the Family Code is inapplicable to this case because this is
not an action to impugn the legitimacy of a child, but an action of the
private respondents to claim their inheritance as legal heirs of their
childless deceased aunt. They do not claim that petitioner Violeta
Cabatbat Lim is an illegitimate child of the deceased, but that she is not
the decedent's child at all.
Liyao vs. Tanhoti-Liyao,G.R. NO. 138961, M ar. 07, 2002 378 SCRA
563
The grounds for impugning the legitimacy of the child mentioned in
Article 255 of the Civil Code may only be invoked by the husband, or in
proper cases, his heirs under the conditions set forth under Article 262
of the Civil Code.
Labagla vs. Santiago, G.R. NO. 132305, Dec. 04, 2001 371 SCRA 360
A baptismal certificate, a private document, is not conclusive proof of
filiation. More so are the entries made in an income tax return, which
only shows that income tax has been paid and the amount thereof.
Macadangdang vs. Court of Appeals, 100 SCRA 73
In this case the husband and the wife continued to live in the same
province after their alleged separation, the Court did not discount the
possibility of physical access to each other considering their proximity to
50
each other and considering further that the wife still visited and
recuperated in her mothers house where her spouse resided with their
children.
Andal vs. M acaraig, 89 Phil 165
The court held that just because tuberculosis is advanced in a man does
not necessarily mean that he is incapable of sexual intercourse. There
are cases where persons suffering from tuberculosis can do the carnal
act even in the most crucial stage of health because then they seemed to
be more inclined to sexual intercourse.
Tison vs CA, 276 SCRA 582 (1997)
The issue of legitimacy cannot be attacked collaterally.
CHAPTER 2. PROOF OF FILIATION (Articles 172-174)
RODOLFO S. AGUILAR vs. EDNA G. SIASAT, G.R. No. 200169, January 28, 2015, J.
Del Castillo
The filiation of illegitimate children, like legitimate children, is established by (1) the
record of birth appearing in the civil register or a final judgment; or (2) an
admission of legitimate filiation in a public document or a private handwritten
instrument and signed by the parent concerned. In the absence thereof, filiation
shall be proved by (1) the open and continuous po ssession of the status of a
legitimate child; or (2) any other means allowed by the Rules of Court and special
laws. The due recognition of an illegitimate child in a record of birth, a will, a
statement before a court of record, or in any authentic writing is, in itself, a
consummated act of acknowledgment of the child, and no further court action is
required. In fact, any authentic writing is treated not just a ground for compulsory
recognition; it is in itself a voluntary recognition that does not require a separate
action for judicial approval.
It must be concluded that Rodolfo who was born during the marriage of Alfredo
Aguilar and Candelaria Siasat-Aguilar and before their respective deaths has
sufficiently proved that he is the legitimate issue of the Aguilar spouses. He
correctly argues, Alfredo Aguilar s SSS satisfies the requirement for proof of filiation
and relationship to the Aguilar spouses under Article 172 of the Family Code; by
itself, said document constitutes an admission of legitimate filiation in a public
document or a private handwritten instrument and signed by the parent
concerned.
51
Solinap vs. Locsin Jr. G.R. NO. 146737 , Dec. 10, 2001 371 SCRA
711
Whether or not the certificate of live birth (Exhibit D) as presented by the
respondent, including the photograph showing that he and his mother
attended the deceased funeral, is sufficient to proof filiation of the
petitioner to the deceased. A birth certificate offers only prima facie
evidence of filiation and may be refuted by contrary evidence.
Verceles v. Posada, G.R. NO.159785, Apr. 27, 2007 522 SCRA 518
The court held that the due recognition of an illegitimate child in a record
of birth, a will, a statement before a court of record, or in any authentic
writing is, in itself, a consummated act of acknowledgement of the child,
and no further court action is required
De Asis vs CA, 303 SCRA 176
Paternity or filiation, or the lack of it, is a relationship that must be
judicially established and it is for the court to declare its existence or
absence.
Lucas v. Lucas, G.R. NO. 190710, Jun. 6, 2011 650 SCRA 667
Although a paternity action is civil, not criminal, the constitutional
prohibition against unreasonable searches and seizures is still
applicable, and a proper showing of sufficient justification under the
particular factual circumstances of the case must be made before a court
may order a compulsory blood test.
Rodriguez vs. CA, G.R. NO. 85723, Jun. 19, 1995 245 SCRA 150
When a recognition has been made by one parent, the name of the other
parent may be revealed in an action by the child to compel such other
parent to recognize him also.
Heirs of Cabais vs. CA, G.R. NO. 106314-15,Oct. 08, 1999 316 SCRA
338
A baptismal certificate, a private document, which, being hearsay, is not
a conclusive proof of filiation.
Cenido vs. Apacionado, G.R .NO. 132474, Nov. 19, 1999 318 SCRA
688
Under the law, this statement must be made personally by the parent
himself or herself, not by any brother, sister or relative; after all, the
52
Tayag v. Tayag-Gallor, G.R. NO. 174680, M ar. 24, 2008 549 SCRA 68
Petitioner, however, overlooks the fact that respondents successional
rights may be established not just by a judicial action to compel
recognition but also by proof that she had been voluntarily acknowledged
and recognized as an illegitimate child. Respondent in this case had not
been given the opportunity to present evidence to show whether she had
been voluntarily recognized and acknowledged by her deceased father
because of petitioners opposition to her petition and motion for hearing
on affirmative defenses.
Puno v. Puno Ent. Inc., G.R. NO. 177066, Sept. 11, 2009 599 SCRA
585
A certificate of live birth purportedly identifying the putative father is not
competent evidence of paternity when there is no showing that the
putative father had a hand in the preparation of the certificate. The local
civil registrar has no authority to record the paternity of an illegitimate
child on the information of a third person.
Gotardo v. Buling, G.R. NO. 165166, Aug. 15, 2012 678 SCRA 436
We have held that such other proof of one's filiation may be a "baptismal
certificate, a judicial admission, a family bible in which [his] name has
been entered, common reputation respecting his pediG.R.ee, admission
by silence, the testimonies of witnesses, and other kinds of proof
admissible under Rule 130 of the Rules of Court." In this case, the
respondent established a prima facie case that the petitioner is the
putative father of Gliffze through testimony that she had been sexually
involved only with one man, the petitioner, at the time of her conception.
Rodulfo corroborated her testimony that the petitioner and the
respondent had intimate relationship.
Lucas v. Lucas, G.R . NO. 190710, Jun. 6, 2011 650 SCRA 667
Although a paternity action is civil, not criminal, the constitutional
prohibition against unreasonable searches and seizures is still
53
Guy v. CA, G.R. NO. 163707, Sept. 15, 2006 502 SCRA 151
It is clear therefore that the resolution of the issue of prescription
depends on the type of evidence to be adduced by private respondents in
proving their filiation. However, it would be impossible to determine the
same in this case as there has been no reception of evidence yet.
De La Cruz v. Gracia G.R. NO. 177728, Jul. 31, 2009 594 SCRA 648
Where the private handwritten instrument is the lone piece of evidence
submitted to prove filiation, there should be strict compliance with the
requirement that the same must be signed by the acknowledging parent.
Where the private handwritten instrument is accompanied by other
relevant and competent evidence, it suffices that the claim of filiation
therein be shown to have been made and handwritten by the
acknowledging parent as it is merely corroborative of such other
evidence.
Uy v. Chu, G.R. NO. 183965, Sept. 18, 2009 600 SCRA 806
It is settled, then, in law and jurisprudence, that the status and filiation
of a child cannot be compromised. Public policy demands that there be
no compromise on the status and filiation of a child. Paternity and
filiation or the lack of the same, is a relationship that must be judicially
54
Republic vs. M iller, G.R. NO.125932, Apr. 21, 1999 306 5CRA 183
An alien qualified to adopt under the Child and Youth Welfare Code,
which was in force at the time of the filing of the petition, acquired a
vested right which could not be affected by the subsequent enactment of
a new law disqualifying him.
Republic vs. Toledano, G.R. NO.94147, Jun. 08, 1994 233 SCRA 9
The Family Code reiterated the rule by requiring that husband and wife
"must" jointly adopt, except in the cases mentioned before. Under the
said new law, joint adoption by husband and wife is mandatory
Cang vs. CA, G.R. NO.105308, Sept. 25, 1998 296 SCRA 128
Physical estrangement alone, without financial and moral desertion, is
not tantamount to abandonment. While admittedly, petitioner was
physically absent as he was then in the United States, he was not remiss
in his natural and legal obligations of love, care and support for his
children.
In re: Adoption of M ichelle & M ichael Lim G.R. NO.168992-93, M ay
21, 2009 588 SCRA 98
The filing of a case for dissolution of the marriage between petitioner and
Olario is of no moment. It is not equivalent to a decree of dissolution of
marriage. Until and unless there is a judicial decree for the dissolution of
the marriage between petitioner and Olario, the marriage still subsists.
That being the case, joint adoption by the husband and the wife is
required.
56
Republic vs. CA & Bobiles, G.R. NO.92326, Jan. 24, 199 2 205 SCRA
356
Under the Child and Youth Welfare Code, private respondent had the
right to file a petition for adoption by herself, without joining her
husband therein. When Mrs. Bobiles filed her petition, she was
exercising her explicit and unconditional right under said law.
Lahom vs. Sibulo, G.R. NO. 143989, July 14, 2003
R.A. NO. 8552 has unqualifiedly withdrawn from an adopter a
consequential right to rescind the adoption decree even in cases where
the adoption might clearly turn out to be undesirable.
TITLE VIII. SUPPORT
Concept of Support
G.R.ounds for Action for Support
Right to support
Order of liability for support
Contractual support vs Legal Support
Mangonon v. CA, G.R. NO. 125041 , June.30, 2006 494 SCRA 1
The grandparents are liable to support their grandchildren if the parent
cannot give support or sufficient support.
Lim v. Lim, G.R. NO. 163209, Oct. 30, 2009 604 SCRA 691
The inability of the parents to sufficiently provide for their children shifts
a portion of their obligation to the ascendants in the nearest degree, both
in the paternal (petitioners) and maternal lines, following the ordering in
Article 199.
Gan vs. Reyes, G.R. NO.145527, M ay.28, 2002 382 SCRA 357
A judgment ordering for support is immediately executory despite
pendency of appeal.
De Asis vs. CA, G.R. NO.127578, Feb. 15, 1999 303 SCRA 176
Whether or not, a renunciation of the existence of filiation of the child
and the putative father, made by the mother, is valid. It is true that in
order to claim support, filiation and,or paternity must first be shown
between the claimant and the parent, however, paternity and filiation or
the lack of the same is a relationship that must be judicially established
and it is for the court to declare its existence or absence.
57
59
It was improper for BBB, knowing that CCC was not his biological son, to have CCC
legitimated after the celebration of BBB and AAA s marriage. The legal process of
legitimation was trifled with when BBB voluntarily but falsely acknowledged CCC as
his son. The principle of estoppel under Article 1431 thus applies, and it now bars
BBB from making an assertion contrary to his previous representations. He should
not be allowed to evade a responsibility arising from his own misrepresentations.
He is bound by the effects of the legitimation process. CCC remains to be BBB s son,
and pursuant to Article 179 of the Family Code, the former is entitled to the same
rights as those of a legitimate child, including the receipt of his father s support.
Duty of Representation
Lindain v. CA, G.R. NO. 95305 , Aug. 20, 199 212 SCRA 725
Under the law, a parent, acting merely as the legal (as distinguished
from judicial) administrator of the property of his/her minor children,
does not have the power to dispose of, or alienate, the property of said
children without judicial approval.
Neri v. Heirs of Hadji Yusop, G.R. No 194366, Oct. 10, 2012 683
SCRA 253
Administration includes all acts for the preservation of the property and
the receipt of fruits according to the natural purpose of the thing. Any
act of disposition or alienation, or any reduction in the substance of the
patrimony of child, exceeds the limits of administration. Thus, a father or
60
OR
TERMINATION
OF
PARENTAL
Bondagjy vs. Bondagjy, G.R. NO. 140817, Dec. 07, 2001 371 SCRA
64
Indeed, what determines the fitness of any parent is the ability to see to
the physical, educational, social and moral welfare of the children, and
the ability to give them a healthy environment as well as physical and
financial support taking into consideration the respective resources and
social and moral situations of the parents.
Cang vs CA,296 SCRA 128
In reference to abandonment of a child by his parent, the act of
abandonment imports any conduct of the parent which evinces a settled
purpose to forego all parental duties and relinquish all parental claims to
the child. It means neglect or refusal to perform the natural and legal
obligations of care and support which parents owe their children.
Title X. EMANCIPATION AND AGE OF MAJORITY; See RA 6809;
2176 & 2180 NCC
Concept
Effects of Emancipation
Title XI SUMMARY JUDICIAL PROCEEDINGS IN THE FAM ILY LAW
Family Courts Act and SC AM Orders and Circulars
CHAPTER 1. SCOPE OF APPLICATION (Article 238)
CHAPTER 2. SEPARATION IN FACT BETWEEN HUSBAND AND W IFE
(Articles 239-248)
See RA 9262 (Anti Violence against W omen and Children [VAWC])
and Implementing Rules &
Regulations
CHAPTER 3. INCIDENTS
(Articles 249-252)
INVOLVING
PARENTAL
AUTHORITY
61
See RA 9262 (Anti Violence against W omen and Children [VAW C]) &
IRR
A.M . NO. 02-11-12-SC- Re: Proposed Rule on Provisional Orders
(M arch 4, 2003)
A.M . NO. 03-02-05-SC- Re: Proposed Rule on Guardianship of M inors
(April 1, 2003)
A.M . NO. 03-04-SC- Re: Proposed Rule on Custody of M inors and
Writ of
Habeas Corpus in Relation to Custody of M inors (April 30, 2003)
CHAPTER 4. OTHER MATTERS
PROCEEDINGS (Article 253)
SUBJECT
TO
SUMMARY
Uy (Jardeleza) vs. CA, G.R. NO. 109557, Nov. 29, 2000 346 SCRA
246
Rule 95 of the ROC, not the Rule on Summary Proceedings in the Family
Code, shall apply in a sale of a conjugal property where one spouse is is
an incompetent. A comatose spouse is incompetent.
Republic v. Tango, G.R. NO.161062, Jul. 31, 2009 594 SCRA 560
By express provision of law, the judgment of the court in a summary
proceeding shall be immediately final and executory. As a matter of
course, it follows that no appeal can be had of the trial courts judgment
in a summary proceeding for the declaration of presumptive death of an
absent spouse under Article 41 of the Family Code.
Rep. v. Bermudez-Lorino G.R. NO. 160258 , Jan. 19, 2005 449 SCRA
5
In Summary Judicial Proceedings under the Family Code, there is no
reglementary period within which to perfect an appeal, precisely because
judgments rendered thereunder, by express provision of Section 247,
Family Code, supra, are "immediately final and executory". It was
erroneous, therefore, on the part of the RTC to give due course to the
Republics appeal and order the transmittal of the entire records of the
case to the Court of Appeals.
62
P ROP ERTY
Concept of Property
Classification of Property
Immovable vs M ovable Properties
Laurel vs. Abrogar,
Jan.
13,
2009
64
Inc.,
vs.
CBAA, M ay
31,
1982
CBAA,
M ay
31,
1982
While the two storage tanks are not embedded in the land, they may,
nevertheless, be considered as improvements on the land, enhancing its
utility and rendering it useful to the oil industry. It is undeniable that the
two tanks have been installed with some deG.R.ee of permanence as
receptacles for the considerable quantities of oil needed by Meralco for its
operations.
Rights as property
MBTC v. Alejo, 364 SCRA 812, 819 (2001)
A real estate mortgage is a real right and a real property by itself.
65
Jura Regalia simply means that the State is the original proprietor of all
lands and, as such, is the general source of all private titles. Thus,
pursuant to this principle, all claims of private title to land, save those
acquired from native title, must be traced from some grant, whether
express or implied, from the State. Absent a clear showing that land had
been let into private ownership through the States imprimatur, such
land is presumed to belong to the State
Public ownership vs State Ownership
Public Service vs Public Use
Villarico v. Sarmiento, 442 SCRA 110, 115 2004
Public use means use which is not confined to privileged individuals,
but is open to the indefinite public.
Characteristics of Properties of Public Dominion
Menchavez vs Teves, Jr, 449 SCRA 380
Properties of public dominion may not be alienated but may be subject to
joint venture, or production-sharing agreements with private individuals
or corporations for their exploration, development and utilization.
Dacanay vs Asistio,Jr 208 SCRA 404
66
20,
2010
To qualify as foreshore land, it must be shown that the land lies between
the high and low water marks and is alternately wet and dry according to
the flow of the tide. The land's proximity to the waters alone does not
automatically make it a foreshore land.
Binalay v. M analo, 195 SCRA 374, 384 (1991)
67
The buyer did not acquire private ownership of the bed of the eastern
branch of the Cagayan River even if it was included in the deeds of
absolute sale executed by the sellers since the sellers could not have
validly sold land that constituted property of public dominion.
Hilario vs City of M anila, G.R. No. L-19570, April 27, 1967
The phrase banks of a river is understood to be those lateral strips
orzones of its beds which are washed by the stream only during such
highfloods as do not cause inundations. In other words, the banks refer
to the lateral lines or strips reached by the waters when the river is at
high tide.
Manila International Airport Authority vs. CA, 495 SCRA 591
No one can dispute that properties of public dominion mentioned in
Article 420 of the Civil Code, like roads, canals, rivers, torrents, ports
and bridges constructed by the State, are owned by the State. The term
ports includes seaports and airports. The MIAA Airport Lands and
Buildings constitute a port constructed by the State.
Reclaimed Properties
Republic vs. Paraaque, G.R. NO. 191109,July 18, 2012
677 SCRA 246
The subject reclaimed lands are still part of the public domain,
owned by the State and, therefore, exempt from payment of real
estate taxes. Here, the subject lands are reclaimed lands,
specifically portions of the foreshore and offshore areas of Manila
Bay. As such, these lands remain public lands and form part of
the public domain.
fundamental that before any land may be declassified from the forest
G.R.oup and converted into alienable or disposable land for
aG.R.icultural or other purposes, there must be a positive act from the
government.
Laurel v. Garcia,187 SCRA 797
Any conveyance of a real property falling under the patrimonial property
of the State must be authorized and approved by a law enacted by the
Congress.
Property for public use of Provinces, Cities, and Municipalities
Patrimonial Property of Political Subdivision
Title II Ownership
Ownership in General
DEPARTMENT OF EDUCATION, represented by its REGIONAL DIRECTOR
TERESITA DOMALANTA vs. MARIANO TULIAO, G.R. No. 205664, June 9, 2014, J.
Mendoza
In actions for recovery of possession, the plaintiff must show proof to support his
claim of his right to possession of the property. The defendant in turn must show
proof to controvert the plaintiff s claim; otherwise the court will rule for the
plaintiff. Thus, when a landowner filed an action for recovery of possession against a
public school which built a gymnasium on a parcel of land which the owner allowed
the school to use as an access road for the schoolchildren, and the plaintiff showed
as evidence tax declarations and a certificate of title over the property, the lone
testimonial evidence the DepEd presented is not sufficient to controvert the
landowner s case. )n addition, the landowner s claim is not barred by laches when
the school s possession of the property is not adverse, and when the landowner
brought suit two years after he learned that the school is constructing a gymnasium
over the property.
HEIRS OF PACIANO YABAO, represented by REMEDIOS CHAN vs. PAZ LENTEJAS
VAN DER KOLK, G.R. No. 207266, June 25, 2014, J. Mendoza
A tax declaration is not a proof of ownership; it is not a conclusive evidence of
ownership of real property. In the absence of actual, public, and adverse possession,
the declaration of the land for tax purposes does not prove ownership.
69
70
thereon is not admissible, except only for the purpose of determining the issue of
possession."
Concept of Ownership
Attributes of Ownership
Recovery of Property
Accion Reinvindicatoria; Ejectment
THE HEIRS OF EUGENIO LOPEZ, SR. NAMELY, OSCAR M. LOPEZ,
MANUEL M. LOPEZ AND PRESENTACION L. PSINAKIS, vs. THE
HONORABLE FRANCISCO QUERUBIN, IN HIS CAPACITY AS PRESIDING
JUDGE OF THE REGIONAL TRIAL COURT OF ANTIPOLO, BRANCH 74,
THE HEIRS OF ALFONSO SANDOVAL AND HIS WIFE ROSA RUIZ,
REPRESENTED BY THEIR ATTORNEY-IN-FACT, MRS. IMELDA RIVERA,
G.R. No. 155405/HEIRS OF EUGENIO LOPEZ, vs. ALFONSO SANDOVAL AND
ROMAN OZAETA, JR., G.R. No. 164092, MARCH 18, 2015, J. Leonardo-de
Castro
One who claims to be the owner of a property that is possessed by another must
bring the appropriate judicial action for its physical recovery. The term "judicial
process" could mean no less than an ejectment suit or reinvindicatory action in
which the ownership claims of the contending parties may be properly heard and
adjudicated.
Del Fierro v. Seguiran G.R. NO. 152141,Aug. 8, 2011 The first
requisite in an accion reinvindicatoria requires that the person who
claims that he has a better right to the property must first fix the identity
of the land he is claiming by describing the location, area and boundaries
thereof. Anent the second requisite, i.e., the claimant's title over the
disputed area, the rule is that a party can claim a right of ownership only
over the parcel of land that was the object of the deed.
Del
Rosario
NO. 170575,June
v. Roxas
8, 2011
Foundation,
G.R.
In forcible entry, the possession is illegal from the beginning and the only
issue is who has the prior possession de facto. In unlawful detainer,
possession was originally lawful but became unlawful by the expiration
or termination of the right to possess and the issue of rightful possession
is the one decisive, for in such action, the defendant is the party in
71
20,
2011
property motorized deep wells but were prevented from doing so by the
authorities precisely because of the construction and existence of the
tunnels underneath the surface of their property.
4. To prove good faith, the following conditions must be present: (a) the seller is the
registered owner of the land; (b) the owner is in possession thereof; and (3) at the
time of the sale, the buyer was not aware of any claim or interest of some other
person in the property, or of any defect or restriction in the titleof the seller or in his
capacity to convey title to the property. All these conditions must be present,
otherwise, the buyer is under obligation to exercise extra ordinary diligence by
scrutinizing the certificates of title and examining all factual circumstances to enable
him to ascertain the seller s title and capacity to transfer any interest in the
property.
74
Definition
Kinds of Accession
Right of Accession with respect to what is produced by property
Accession Discreta
Kinds of Fruits
Right of Accession with respect to immovable property
Accession Continua
Fundamental rules
Industrial Accession
Building, Planting, and Sowing (BPS)
Rules in BPS in the presence of good faith and bad faith
Concept of Good Faith
Rules governing BPS
Floreza v. Evangelista, 96 SCRA 130
The rule under article 448 of the NCC applies only when the builder,
planter or sower believes he had the right so to build, plant or sow
because he thinks he owns the land or believes himself to have a claim of
title.
Mercado v. CA, 162 SCRA 75, 85 1988
To be deemed a builder in good faith, it is essential that a person asserts
title to the land on which he builds, i.e., it is essential that he be a
possessor in concept of owner and that he be unaware that there exists
in his title or mode of acquisition any flaw which invalidates it.
Bulacanag v. Francisco, 122 SCRA 498, 502 (1983)
Article 448 applies only to a case where one builds on land in the belief
that he is the owner thereof and it does not apply where ones only
interest in the land is that of a lessee under a rental contract.
75
Since the subject land was the direct result of the dumping of sawdust
by the Sun Valley Lumber Co., the accretion was man-made, hence, Art.
457 does not apply. Ergo, the subject land is part of the public domain.
Roxas v. Tuason, 9 Phil. 408.
The right of the owners of the bank adjacent to rivers to the accretion
which they receive by virtue of the action of the waters of the river is ipso
jure and there is no need of an action of the owner of the bank to possess
the new addition since it belongs to him by the very fact of the addition.
Cureg v. IAC, 177 SCRA 313 (1989)
The accretion to registered land does not preclude acquisition of the
additional area by another person through prescription.
Avulsion
Definition
Avulsion vs Alluvion
Rules Governing Avulsion
Change of course of River
Agne v. Director of Lands, 181 SCRA 793, 805 (1990)
There need be no act on their part to subject the old river bed to their
ownership, as it is subject thereto ipso jure from the moment the mode of
acquisition becomes evident, without need of any formal act of
acquisition. Such abandoned riverbed had fallen to the private ownership
of the owner of the land through which the new river bed passes even
without any formal act of his will and any unauthorized occupant thereof
will be considered as a trespasser.
Formation of Island
Right of Accession with respect to M ovable Property
Adjunction or Conjunction
Rules governing Adjunction or Conjunction
Presence and absence of badfaith
77
Commixtion or Confusion
Specification
Chapter 3 Quieting of Title
Action to Quiet Title
HEIRS OF PACIFICO POCIDO, ET AL. VS. ARSENIA AVILA AND EMELINDA CHUA G.R. No.
199146, March 19, 2014, J. Carpio
The DENR Decision was affirmed by the Office of the President which held that lands
within the Baguio Townsite Reservation belong to the public domain and are no
longer registrable under the Land Registration Act. The Office of the President
ordered the disposition of the disputed property in accordance with the applicable
rules of procedure for the disposition of alienable public lands within the Baguio
Townsite Reservation, particularly Chapter X of Commonwealth Act No. 141 on
Townsite Reservations and other applicable rules. Having established that the
disputed property is public land, the trial court was therefore correct in dismissing
the complaint to quiet title for lack of jurisdiction. The trial court had no jurisdiction
to determine who among the parties have better right over the disputed property
which is admittedly still part of the public domain.
For an action to quiet title to prosper, two indispensable requisites must concur,
namely: (1) the plaintiff or complainant has a legal or equitable title to or interest in
the real property subject of the action; and (2) the deed, claim, encumbrance, or
proceeding claimed to be casting cloud on the title must be shown to be in fact
invalid or inoperative despite its prima facie appearance of validity or efficacy. The
first requisite was not complied with. Petitioners alleged open, continuous,
exclusive, and uninterrupted possession of the subject property is belied by the fact
that respondents, in 2005, entered into a Contract of Lease with the Avico Lending
Investor Co. over the subject lot without any objection from the petitioners.
Petitioners inability to offer evidence tending to prove that Bienvenido and
Escolastica Ibarra transferred the ownership over the property in favor of
petitioners is likewise fatal to the latter s claim.
78
Considering that the action for annulment and cancellation of title filed by the
respondents is substantially in the nature of an action for reconveyance based on an
implied or constructive trust, combined with the fact that the respondents have
always been in possession of the subject property, the Court treated Civil Case No.
18421 as an action to quiet title, the filing of which does not prescribe.
Requisites
HERMINIO M. DE GUZMAN, FOR HIMSELF AND AS ATTORNEY-IN-FACT OF:
NILO M. DE GUZMAN, ANGELINO DE GUZMAN, JOSEFINO M. DE GUZMAN,
ESTRELLA M. DE GUZMAN, TERESITA DE GUZMAN, ELSA MARGARITA M. DE
GUZMAN, EVELYN M. DE GUZMAN, MA. NIMIA M. DE GUZMAN, ANTOLIN M. DE
GUZMAN, AND FERDINAND M. DE GUZMAN vs. TABANGAO REALTY
INCORPORATED, G.R. No. 154262, February 11, 2015, J. Leonardo-De Castro
The petitioners allege that they are the owners of the disputed property. This
allegation is anchored on the assertion that at the time of the death of their parents,
the disputed property is still under the latter s name. The Supreme Court ruled that
for an action to quiet title to prosper, two indispensable requisites must concur: (1)
the plaintiff or complainant has a legal or equitable title or interest in the real
property subject of the action; and (2) the deed, claim, encumbrance, or proceeding
claimed to be casting a cloud on his title must be shown to be in fact invalid or
inoperative despite its prima facie appearance of validity or legal efficacy.
Petitioners Complaint in Civil Case No. TM-1118 failed to allege these two requisites
for an action to quiet title.
CLT REALTY DEVELOPMENT CORPORATION vs. PHIL-VILLE DEVELOPMENT
AND HOUSING CORPORATION, REPUBLIC OF THE PHILIPPINES (THROUGH
THE OFFICE OF THE SOLICITOR GENERAL) AND THE REGISTER OF DEEDS OF
METRO MANILA DISTRICT III, CALOOCAN, G.R. No. 160728, March 11, 2015, J.
Leonardo-De Castro
Thus, both requisites in order for an action for quieting of title to prosper have been
met in this case: (1) Phil-Ville had established its equitable title or interest in the 16
parcels of land subject of the action; and (2) TCT No. T-177013, found to overlap
titles to said properties of Phil-Ville, was previously declared invalid.
Chung Jr. vs. M ondragon, G.R. 179754,Nov.
21,
2012
The issues in a case for quieting of title are fairly simple; the plaintiff
need to prove only two things, namely: "(1) the plaintiff or complainant
has a legal or an equitable title to or interest in the real property subject
of the action; and (2) that the deed, claim, encumbrance or proceeding
claimed to be casting a cloud on his title must be shown to be in fact
79
11,
2012
Under Articles 476 and 477 of the Civil Code, the two (2) indispensable
requisites in an action to quiet title are: (1) that the plaintiff or
complainant has a legal or an equitable title to or interest in the real
property subject of the action; and (2) that a deed, claim, encumbrance
or proceeding is claimed to be casting cloud on his title.
In this case, an action to quiet title is not the proper remedy because
petitioner no longer had any legal or equitable title to or interest in the
lots. The petitioners status as possessor and owner of the lots had be en
settled in the final and executory December 4, 1985 decision of the
Bureau of Lands that the DENR Secretary and the OP affirmed on
appeal. Thus, the petitioner is not entitled to the possession and
ownership of the lots.
80
A stipulation in a contract requiring a co-owner to secure an authority from his coowners for the alienation of his share, as seemingly indicated in this case, should be
considered mere surplusage and does not, in any way, affect the validity or the
enforceability of the contract. Pursuant to Article 493, a co-owner has the right to
alienate his proindiviso share in the co-owned property even without the consent of
his co-owners.
REYNALDO DELA ROSA, Namely: TEOFISTA DELA ROSA, JOSEPHINE SANTIAGO
AND JOSEPH DELA ROSA v MARIO A. BA TONGBACAL, IRENEO BATONGBACAL,
JOCELYN BA TONGBACAL, NESTOR BATONGBACAL AND LOURDES BA
TONGBACAL, G.R No. 179205, July 30, 2014 J. PEREZ
A contract of sale is a consensual contract, which becomes valid and binding upon
the meeting of minds of the parties on the price and the object of the sale. The mere
inadequacy of the price docs not affect its validity when both parties are in a
position to form an independent judgment concerning the transaction, unless fraud,
mistake or undue influence indicative of a defect in consent is present. A contract
may consequently be annulled on the ground of vitiated consent and not due to the
inadequacy of the price. In the case at bar, however, no evidence to prove fraud,
mistake or undue influence indicative of vitiated consent is attendant.
RAUL V. ARAMBULO AND TERESITA DELA CRUZ VS. GENARO NOLASCO AND JEREMY
SPENCER NOLASCO, G.R. No. 189420
March 26, 2014, J. Perez
Extinguishment of Co-ownership
VILMA QUINTOS, represented by her Attorney-in-Fact FIDEL I. QUINTOS, JR.;
FLORENCIA I. DANCEL, represented by her Attorney-in-Fact FLOVY I. DANCEL;
and CATALINO L. IBARRA v PELAGIA I. NICOLAS, NOLI L. IBARRA, SANTIAGO L.
IBARRA, PEDRO L. IBARRA, DAVID L. IBARRA, GILBERTO L. IBARRA, HEIRS OF
AUGUSTO L. IBARRA, namely CONCHITA R., IBARRA, APOLONIO IBARRA, and
NARCISO IBARRA, and the spouses RECTO CANDELARIO and ROSEMARIE
CANDELARIO. G.R No. 210252, June 16, 2014. J. VELASCO, JR.
A partition case of a land co-owned by ten siblings was dismissed for the failure of
the parties and counsels to appear despite due notice under Rule 17, Section 3 of the
Rules of Court. Later, in a quieting of title case involving the same property, the
siblings demanded partition. The occupant of the lot claimed that the action for
partition is barred by res judicata.
It is indeed true that dismissal with prejudice under the above-cited rule amply
satisfies one of the elements of res judicata. However, dismissal with prejudice
under Rule 17, Sec. 3 of the Rules of Court cannot defeat the right of a co -owner to
ask for partition at any time, provided that there is no actual adjudication of
ownership of shares yet.
A perusal of Article 494 of the Civil Code shows that the law generally does not favor
the retention of co-ownership as a property relation, and is interested instead in
ascertaining the co-owners specific shares so as to prevent the allocation of
portions to remain perpetually in limbo. Thus, the law provides that each co-owner
may demand at any time the partition of the thing owned in common.
Between dismissal with prejudice under Rule 17, Sec. 3 and the right granted to co owners under Art. 494 of the Civil Code, the latter must prevail. To construe
otherwise would diminish the substantive right of a co-owner through the
promulgation of procedural rules. Such a construction is not sanctioned by the
principle, which is too well settled to require citation, that a substantive law cannot
be amended by a procedural rule. This is supported by Art. 496 of the New Civil
Code.
Thus SC held that Art. 494is an exception to Rule 17, Sec. 3 of the Rules of Court to
the effect that even if the order of dismissal for failure to prosecute is silent on
83
Sanchez v. Court of Appeals, 404 SCRA 541, 548, June 20, 2003
Co-ownership is a form of trust and every co-owner is a trustee for the
others, hence, the relationship of such co-owner to the other co-owners
is fiduciary in character and attribute.
Pangan v. Court of Appeals, 166 SCRA 375, 382, Oct. 17, 1988
If the co-owner actually holding the property asserts exclusive dominion
over it against the other co-owners, the corollary of the rule is that he
can acquire sole title to it after the lapse of the prescribed prescriptive
period.
Heirs of Flores Restar v. Heirs of Dolores R. Cichon 475 SCRA 731,
Nov. 22, 2005
While the action to demand partition of a co-owned property does not
prescribe, a co-owner may acquire ownership thereof by prescription
where there exists a clear repudiation of the co-ownership, and the coowners are apprised of the claim of adverse and exclusive ownership.
Delima v. Court of Appeals, 201 SCRA 641, Sept. 24, 1991
From the moment one of the co-owners claims that he is the absolute
and exclusive owner of the properties and denies the others any share
therein, the question involved is no longer one of partition but of
ownership
Maritegui v. Court of Appeals 205 SCRA 337,
84
M ar.
21,
2011
The first phase of a partition and,or accounting suit is taken up with the
determination of whether or not a co-ownership in fact exists, and a
partition is proper (i.e., not otherwise legally proscribed) and may be
made by voluntary aG.R.eement of all the parties interested in the
property. This phase may end with a declaration that plaintiff is not
entitled to have a partition either because a co-ownership does not exist,
or partition is legally prohibited.
Cruz v.
Feb.
12,
2008
The Court ruled that PNB has the right to the writ. The allegedly invalidity of the sale
between PNB and Atty. Garay is not a ground to oppose or defer the issuance of the
Writ of Possession as this does not affect PNB s right to possess the subject
property. As the registered owner, PNB is entitled to the possession of the subject
property as a matter of right.
NORMA V. JAVATE vs. SPOUSES RENATO J. TIOTUICO AND LERMA C. TIOTUICO,
G.R. No. 187606, March 09, 2015, J. Peralta
If the purchaser is a third party who acquired the property after the redemption
period, a hearing must be conducted to determine whether possession over the
subject property is still with the mortgagor or is already in the possession of a third
party holding the same adversely to the defaulting debtor or mortgagor. In the
instant case, while respondents' petition for the issuance of a writ of possession was
filed ex-parte, a hearing was, nonetheless, conducted when the RTC gave
petitioner her day in court by giving her the opportunity to file various pleadings to
oppose respondent's petition. Moreover, there is no dispute that petitioner
remained in possession of the subject property prior to the issuance of the
questioned writ of possession. It is, thus, clear that respondents' resort, as a
subsequent or third-party purchaser, the petition for the issuance of a writ of
possession is proper.
MARCELA M. DELA CRUZ VS. ANTONIO O. HERMANO, ET AL. G.R. No. 160914.
March 25, 2015, J. Sereno
To prove their claim of having a better right to possession, respondents submitted
their title thereto and the latest Tax Declaration prior to the initiation of the
ejectment suit. The CA erred in considering those documents sufficient to prove
respondents prior physical possession. Similarly, tax declarations and realty tax
payments are not conclusive proofs of possession. They are merely good indicia of
possession in the concept of owner based on the presumption that no one in one s
right mind would be paying taxes for a property that is not in one s actua l or
constructive possession.
The respondents have claimed from the inception of the controversy up to now that
they are using the property as their vacation house, this claim, however, is not
substantiated by any corroborative evidence. Their uncorroborated claim of that
fact, even if made under oath, is self-serving. . The respondents failed to discharge
their burden of proving the element of prior physical possession.
Concept of Possession
Elements of Possession
86
Kinds of Possession
Possession in Good Faith and Bad Faith
PNB v. De Jesus, G.R. NO. 149295, September 23, 2003 - One is
considered in good faith if he is not aware that there exists in his title or
mode of acquisition any flaw which invalidates it.
Parilla v. Pilar, G.R. NO. 167680, Nov. 30, 2006 - One whose interest
is merely that of a holder, such as a mere tenant, agent or usufructuary,
is not qualified to become a possessor builder in good faith.
Abalos
v.
Heirs
of
Torio,
G.R.
NO. 175444,
Dec.
14,
2011 - Acts of possessory character
executed due to license or by mere tolerance of the owner are inadequate
for purposes of acquisitive prescription. Possession, to constitute the
foundation of a prescriptive right, must be en concepto de dueo, or, to
use the common law equivalent of the term, that possession should be
adverse, if not, such possessory acts, no matter how long, do not start
the running of the period of prescription.
Chapter 2 Acquisition of Possession
ANACLETO C. MANGASER, REPRESENTED BY HIS ATTORNEY-IN-FACT
EUSTAQUIO DUGENIAvs. DIONISIO UGAY, G.R. No. 204926, December 03, 2014,
J. Mendoza
For a forcible entry suit to prosper, the plaintiffs must allege and prove: (a) that they
have prior physical possession of the property; (b) that they were deprived of
possession either by force, intimidation, threat, strategy or stealth; and, (c) that the
action was filed within one (1) year from the time the owners or legal possessors
learned of their deprivation of the physical possession of the property.
There is only one issue in ejectment proceedings: who is entitled to physical or
material possession of the premises, that is, to possession de facto, not possession
de Jure? Issues as to the right of possession or ownership are not involved in the
action; evidence thereon is not admissible, except only for the purpose of
determining the issue of possession.
As a rule, the word "possession" in forcible entry suits indeed refers to nothing more
than prior physical possession or possession de facto, not possession de Jure or legal
possession in the sense contemplated in civil law. Title is not the issue, and the
absence of it "is not a ground for the courts to withhold relief from the parties in an
ejectment case."
87
Possession can be acquired by juridical acts. These are acts to which the law gives
the force of acts of possession. Examples of these are donations, succession,
execution and registration of public instruments, inscription of possessory
information titles and the like. The reason for this exceptional rule is that possession
in the eyes of the law does not mean that a man has to have his feet on every square
meter of ground before it can be said that he is in possession. It is sufficient that
petitioner was able to subject the property to the action of his will.
CARMENCITA SUAREZ VS. MR. AND MRS. FELIX E. EMBOY JR. AND MARILOU P. EMBOYDELANTAR G.R. No. 187944 March 12, 2014, J. Reyes
In a complaint for unlawful detainer, the following key jurisdictional facts must be
alleged and sufficiently established: (1) initially, possession of property by the
defendant was by contract with or by tolerance of the plaintiff;(2) eventually, such
possession became illegal upon notice by plaintiff to defendant of the termination of
the latter s right of possession;
thereafter, the defendant remained in possession
of the property and deprived the plaintiff of the enjoyment thereof; and (4) within
one year from the last demand on defendant to vacate the property, the plaintiff
instituted the complaint for ejectment.
In the case at bar, the first requisite mentioned above is markedly
absent. Carmencita failed to clearly allege and prove how and when the
respondents entered the subject lot and constructed a house upon it. Carmencita
was likewise conspicuously silent about the details on who specifically permitted
the respondents to occupy the lot, and how and when such tolerance came
about. Instead, Carmencita cavalierly formulated a legal conclusion, sans factual
substantiation, that a the respondents initial occupation of the subject lot was
lawful by virtue of tolerance by the registered owners, and (b) the respondents
became deforciants unlawfully withholding the subject lot s possession after
Carmencita, as purchaser and new registered owner, had demanded for the former
to vacate the property. It is worth noting that the absence of the first requisite
assumes even more importance in the light of the respondents claim that for
decades, they have been occupying the subject lot as owners thereof.
SPOUSES EDMUNDO DELA CRUZ AND AMELIA CONCIO-DELA CRUZ VS. SPOUSES
RUFINO R. CAPCO AND MARTY C. CAPCO G.R. No. 176055, March 17, 2014
"The only issue in an ejectment case is the physical possession of real property
possession de facto and not possession de jure." But "[w]here the parties to an
ejectment case raise the issue of ownership, the courts may pass upon that issue to
determine who between the parties has the better right to possess the property."
Here, both parties anchor their right to possess based on ownership, i.e., the spouses
Dela Cruz by their own ownership while the spouses Capco by the ownership of
Rufino as one of the heirs of the alleged true owner of the property. Thus, the MeTC
88
and the RTC correctly passed upon the issue of ownership in this case to determine
the issue of possession. However, it must be emphasized that "[t]he adjudication of
the issue of ownership is only provisional, and not a bar to an action between the
same parties involving title to the property."
BONIFACIO PIEDAD, MARIA PIEDAD represented by INSPIRACION DANAO
v SPOUSES VICTORIO GURIEZA and EMETERIA M. GURIEZA, G.R No.
207525, June 18, 2014. J. PERLAS-BERNABE
Unlawful detainer is an action to recover possession of real property from one who
unlawfully withholds possession thereof after the expiration or termination of his
right to hold possession under any contract, express or implied. An ejectment case,
based on the allegation of possession by tolerance, falls under the category of
unlawful detainer. Where the plaintiff allows the defendant to use his/her property
by tolerance without any contract, the defendant is necessarily bound by an implied
promise that he/she will vacate on demand, failing which, an action for unlawful
detainer will lie. In unlawful detainer actions, the Court shall solely resolve the issue
as to who between the parties has the better right of possession de facto over the
subject lot. Corollary thereto, issues pertaining to ownership are better threshed out
in another action instituted for such purpose.
FE U. QUIJANO v ATTY. DARYLL A. AMANTE, G.R No. 164277, October 8, 2014. J.
BERSAMIN
Where the plaintiff does not prove her alleged tolerance of the defendant's
occupation, the possession is deemed illegal from the beginning. Hence, the action
for unlawful detainer is an improper remedy. But the action cannot be considered as
one for forcible entry without any allegation in the complaint that the entry of the
defendant was by means of force, intimidation, threats, strategy or stealth .
ROBERT AND NENITA DE LEON, vs. GILBERT AND ANALYN DELA LLANA, G.R.
No. 212277, February 11, 2015, J. Perlas-Bernabe
An unlawful detainer complaint was filed by Gilbert dela Llana against petitioner
Robert de Leon and Gil de Leon. Robert and Gil contend that the lease contract was
simulated. It is quite apparent that the MCTC-Nabunturan-Mawab actually intended
to mean that the undated lease contract subject of this case was absolutely
simulated. Its pronouncement that the parties did not intend to be bound by their
agreement is simply inconsistent with relative simulation.
Bunyi v.
Factor, G.R. NO.
591 SCRA 350
172547,
Jun.
30,
2009
89
175604,
Apr.
10,
2008
v.
109595,
Apr.
27,
2000
90
them, then she deserves to be respected and restored to her lawful possession as
provided in Article 539 of the New Civil Code.
SUBIC BAY LEGEND RESORTS AND CASINOS, INC. vs. BERNARD C. FERNANDEZ,
G.R. No. 193426, September 29, 2014, J. Del Castillo
Though casino chips do not constitute legal tender, there is no law which prohibits
their use or trade outside of the casino which issues them. In any case, it is not
unusual nor is it unlikely that respondent could be paid by his Chinese client at
the former's car shop with the casino chips in question; said transaction, if not
common, is nonetheless not unlawful. These chips are paid for anyway petitioner
would not have parted with the same if their corresponding representative
equivalent in legal tender, goodwill, or otherwise was not received by it in return
or exchange. Given this premise that casino chips are considered to have been
exchanged with their corresponding representative value it is with more reason
that the Court should require petitioner to prove convincingly and persuasively that
the chips it confiscated from the Fernandez brothers were indeed stolen from it; if
so, any Tom, Dick or Harry in possession of genuine casino chips is presumed to
have paid for their representative value in exchange therefor. If SBL cannot prove its
loss, then Art. 559 cannot apply; the presumption that the chips were exchanged for
value remains.
PENTA PACIFIC REALTY CORPORATION vs. LEY CONSTRUCTION AND
DEVELOPMENT CORPORATION, G.R. No. 161589, November 24, 2014, J.
Bersamin
Penta Pacific leased its properties to Ley Construction. Both parties then entered
into a contract to sell. Ley Construction failed to pay its amortizations prompting
Penta Pacific to file an action for ejectment.
The MeTC correctly exercised its authority in finding for the petitioner as the
plaintiff. In unlawful detainer, the possession was originally lawful but became
unlawful by the expiration or termination of the right to possess; hence, the issue of
rightful possession is decisive for, in the action, the defendant is in actual possession
and the plaintiffs cause of action is the termination of the defendant's r ight to
continue in possession.
A defendant's claim of possession de jure or his averment of ownership does not
render the ejectment suit either accion publiciana or accion reivindicatoria. The suit
remains an accion interdictal, a summary proceeding that can proceed
independently of any claim of ownership. Even when the question of possession
cannot be resolved without deciding the issue of ownership, the issue of ownership
is to be resolved only to determine the issue of possession.
91
V.
614
80298,
Apr.
26,
1990
Actual delivery of the books having been made, Cruz acquired ownership
over the books which he could then validly transfer to the private
respondents. The fact that he had not yet paid for them to EDCA was a
matter between him and EDCA and did not impair the title acquired by
the private respondents to the books.
BPI Family
v.
123498,
Nov.
23,
2007
Bad faith does not simply connote bad judgment or negligence; it imports
a dishonest purpose or some moral obliquity and conscious doing of
wrong; it partakes of the nature of fraud. We have held that it is a breach
of a known duty through some motive of interest or ill will.
Title VI Usufruct
Characteristics and Nature
Rights and Obligations of the Parties
Title VII. Easements or Servitude
Mere convenience for the dominant estate is not what is required by law as the basis
of setting up a compulsory easement. Even in the face of necessity, if it can be
satisfied without imposing the easement, the same should not be imposed.
Based on the Ocular )nspection Report, petitioner s property had another outlet to
the highway. In between her property and the highway or road, however, is an
irrigation canal, which can be traversed by constructing a bridge, similar to what
was done by the owners of the nearby properties.
There is, therefore, no need to utilize respondents property to serve petitioner s
needs. Another adequate exit exists. Petitioner can use this outlet to access the
public roads.
Restrictive Covenant
Fajardo v. Freedom
which one may use his own property, do not result in true easements,
but a case of servitudes (burden), sometimes characterized to be negative
easements or reciprocal negative easements.
Abellana v. CA, G.R. NO.
112331,
M ay
29,
1996
Unisource v.
173252,
Jul.
17,
2009
Classification of Nuisance
LINDA RANA vs. TERESITA LEE WONG, SPS. SHIRLEY LEE ONG and
RUBEN ANG ONG and SPS. ROSARIO and WILSON UY; SPS. ROSARIO and
WILSON UY; WILSON UY as attorney-in-fact of TERESITA LEE WONG, and
SPS. SHIRLEY LEE ONG and RUBEN ANG ONG vs. SPS. REYNALDO and
LINDA LANA, G.R. No. 192861; G.R. No. 192862, June 30, 2014, J. Perlas -Bernabe
It is a standing jurisprudential rule that unless a nuisance is a nuisance per se, it may
not be summarily abated. Aside from the remedy of summary abatement which
should be taken under the parameters stated in Articles 704 (for public nuisances)
and 706 (for private nuisances) of the Civil Code, a private person whose property
right was invaded or unreasonably interfered with by the act, omission,
establishment, business or condition of the property of another may file a civil
action to recover personal damages. Abatement may be judicially sought through a
civil action therefor if the pertinent requirements under the Civil Code for summary
abatement, or the requisite that the nuisance is a nuisance per se, do not concur. To
note, the remedies of abatement and damages are cumulative; hence, both may be
demanded.
LINDA RANA v TERESITA WONG, G.R No. 192861, June 30, 2014. J. PERLASBERNABE
The spouses Wong and the spouses Rana are neighbors who live across a road from
each other. The Ranas elevated and cemented the road without consultation from
the spouses Wong. Wong et al availed of the remedy of judicial abatement and
damages against Spouses Rana, claiming that the elevated and cemented portion are
nuisances that curtailed their use and enjoyment of their properties.
With respect to the elevated and cemented subject portion, the Court finds that the
same is not a nuisance per se. By its nature, it is not injurious to the health or
comfort of the community. It was built primarily to facilitate the ingress and egress
of Sps. Rana from their house which was admittedly located on a higher elevation
than the subject road and the adjoining Uy and Wong-Ong properties. Since the
subject portion is not a nuisance per se, it cannot be summarily abated. The
demolition order secured by Wong was thus unwarranted, entitling the spouses
Rana to nominal and temperate damages.
CRISOSTOMO B. AQUINO v MUNICIPALITY OF MALAY, AKLAN, represented by
HON. MAYOR JOHN P. YAP, SANGGUNIANG BA YAN OF MALAY, AKLAN,
represented by HON. EZEL FLORES, DANTE PASUGUIRON, ROWEN AGUIRRE,
WILBEC GELITO, JUPITER GALLENERO, OFFICE OF THE MUNICIPAL ENGINEER,
95
182567,
Jul.
13,
2009
96
Quezon
11,
2011
The wing walls do not per se immediately and adversely affect the safety
of persons and property. The fact that an ordinance may declare a
structure illegal does not necessarily make that structure a nuisance.
Perez v.
M adrona G.R. NO. 184478,
M ar.
21,
2012 Respondents fence is not a nuisance per se. By its nature, it is not
injurious to the health or comfort of the community. It was built
primarily to secure the property of respondents and prevent intruders
from entering it.
Donation
CHARLES BUMAGAT, JULIAN BACUDIO, ROSARIO PADRE, SPOUSES ROGELIO
and ZOSIMA PADRE, and FELIPE DOMINCIL v REGALADO ARRIBAY, G.R No.
194818, June 9, 2014. J. DEL CASTILLO
Under Article 749 and 709 of the Civil Code, it may be inferred that as between the
parties to a donation of an immovable property, all that is required is for said
donation to be contained in a public document. Registration is not necessary for it to
be considered valid and effective. However, in order to bind third persons, the
donation must be registered in the Registry of Land Titles and Deeds. Although the
non-registration of a deed of donation shall not affect its validity, the necessity of
registration comes into play when the rights of third persons are affected, as in the
case at bar.
In this case, the donation executed by Gonzales in favor of his grandchildren,
although in writing and duly notarized, has not been registered in accordance with
law. Hence, while the deed of donation is valid between the donor and the donees,
such deed, however, did not bind the tenants-farmers who were not parties to the
donation. Non-registration of a deed of donation does not bind other parties
ignorant of a previous transaction. It is of no moment that the right of the tenantfarmers in this case was created by virtue of a decree or law. They are still
considered "third persons" contemplated in our laws on registration, for the fact
remains that these tenant-farmers had no actual knowledge of the deed of donation.
REPUBLIC OF THE PHILIPPINES, REPRESENTED BY THE SECRETARY OF
AGRICULTURE vs. FEDERICO DACLAN, JOSEFINA COLLADO, AND HER HUSBAND
FEDERICO DACLAN AND MINVILUZ DACLAN, AS SURVIVING HEIRS OF
97
DECEASED JOSE DACLAN, G.R. No. 197115 (consolidated), March 23, 2015, J.
Del Castillo
The Daclans lament the supposed failure of the Province to provide agricultural
extension and on-site research services and facilities as required under the )RR of
the LGC of 1991, which failure they believe, constituted a violation of the stipulation
contained in the deeds of donation to develop and improve the livestock industry of
the country. Yet this cannot be made a ground for the reversion of the donated
lands; on the contrary, to allow such an argument would condone undue
interference by private individuals in the operations of government. The deeds of
donation merely stipulated that the donated lands shall be used for the
establishment of a breeding station and shall not be used for any other purpose, and
that in case of non-use, abandonment or cessation of the activities of the BAI,
possession or ownership shall automatically revert to the Daclans. It was never
stipulated that they may interfere in the management and operation of the breeding
station. Even then, they could not directly participate in the operations of the
breeding station.
Nature of Donations
Classification of Donations
Persons who may giver or receive a Donation
Formalities of Donation
ESPERANZA C. CARINAN vs. SPOUSES GAVINO CUETO and CARMELITA CUETO, G.R. No.
198636, October 8, 2014, J. Reyes
In order to sufficiently substantiate her claim that the money paid by the
respondents was actually a donation, petitioner should have also submitted in court
a copy of their written contract evincing such agreement. As earlier ruled by the
Court, a donation must comply with the mandatory formal requirements set forth by
law for its validity. When the subject of donation is purchase money, Article 748 of
the NCC is applicable. Accordingly, the donation of money as well as its acceptance
should be in writing. Otherwise, the donation is invalid for non-compliance with the
formal requisites prescribed by law.
Effects and limitation of Donation
a separate instrument is either not given to the donor or else noted in the
deed of donation, and in the separate acceptance.
Villanueva vs. Spouses Branoco, G.R. No. 172804, January 24, 2011
When the donor used the words that the gift "does not pass title during
my lifetime; but when I die, she shall be the true owner of the two
aforementioned parcels"] the donor meant nothing else than that she
reserved of herself the possession and usufruct of said two parcels of
land until her death, at which time the donee would be able to dispose of
them freely.
Central Philippines University vs. CA, G.R. No. 112127 July 17,
1995
If there was no fulfillment or compliance with the condition, the donation
may now be revoked and all rights which the donee may have acquired under it
shall be deemed lost and extinguished.
Insular
Life
v.
44059,
Oct.
28,
1977
v.
Sept.
30,
2008
126444,
Dec.
4,
1998.
Since no period was imposed by the donor on when must the donee
comply with the condition, the latter remains the owner so long as he
has tried to comply with the condition within a reasonable period. Only
then - when the non-fulfillment of the resolutory condition was brought
99
PRESCR IP TION
METROPOLITAN FABRICS INC. ET AL. VS. PROSPERITY CREDIT RESOURCES
ENC. ET AL. G.R. No. 154390 March 17, 2014, J. Bersamin
With the contract being voidable, petitioners action to annul the real estate
mortgage already prescribed. Article 1390, in relation to Article 1391 of the Civil
Code, provides that if the consent of the contracting parties was obtained through
fraud, the contract is considered voidable and may be annulled within four years
from the time of the discovery of the fraud. The discovery of fraud is reckoned from
the time the document was registered in the Register of Deeds in view of the rule
that registration was notice to the whole world. Thus, because the mortgage
involving the seven lots was registered on September 5, 1984, they had until
September 5, 1988 within which to assail the validity of the mortgage. But their
complaint was instituted in the RTC only on October 10, 1991.Hence, the action,
being by then already prescribed, should be dismissed.
RURAL BANK OF CABADBARAN, INC v JORGITA A. MELECIO-YAP, LILIA
MELECIO PACIFICO (deceased, substituted by her only child ERILL* ISAAC M.
PACIFICO, JR.), REYNALDO A. MELECIO DELOSO, and SARAH MELECIO PALMAGIL, G.R No. 178451, July 30, 2014. J. PERLAS-BERNABE
In this case, the complaint for nullification of the SPA was filed before the RTC on
April 17,1996, or barely three years from the discovery of the averred forgery in
1993, which is within the four-year prescriptive period provided under Article 1146
of the Civil Code to institute an action upon the injury to their rights over the subject
properties. A delay within the prescriptive period is sanctioned by law and is not
considered to be a delay that would bar relief. Laches applies only in the absence of
a statutory prescriptive period.
SPOUSES FRANCISCO SIERRA (substituted by DONATO, TERESITA, TEODORA,
LORENZA, LUCINA, IMELDA, VILMA, and MILAGROS SIERRA) and ANTONINA
SANTOS, SPOUSES ROSARIO SIERRA and EUSEBIO CALUMA LEYVA, and
SPOUSES SALOME SIERRA and FELIX GATLABAYAN (substituted by BUENA
VENTURA, ELPIDIO, PAULINO, CATALINA, GREGORIO, and EDGARDO
GATLABAYAN, LORETO REILLO, FERMINA PEREGRINA, and NIDA HASHIMOTO)
vs. PAIC SAVINGS AND MORTGAGE BANK, INC., G.R. No. 197857, September 10,
2014, J. Perlas- Bernabe
100
Since the complaint for annulment was anchored on a claim of mistake, i.e., that
petitioners are the borrowers under the loan secured by the mortgage, the action
should have been brought within four (4) years from its discovery. As mortgagors
desiring to attack a mortgage as invalid, petitioners should act with reasonable
promptness, else its unreasonable delay may amount to ratification. Verily, to allow
petitioners to assert their right to the subject properties now after their unjustified
failure to act within a reasonable time would be grossly unfair to PSMB, and
perforce should not be sanctioned. As such, petitioners' action is already barred by
laches, which, as case law holds, operates not really to penalize neglect or sleeping
on one's rights, but rather to avoid recognizing a right when to do so would result in
a clearly inequitable situation.
INTELLECTUAL PROPERTY
SHANG PROPERTIES REALTY CORPORATION (formerly THE SHANG GRAND
TOWER CORPORATION) and SHANG PROPERTIES, INC. (formerly EDSA
PROPERTIES HOLDINGS, INC.), v ST. FRANCIS DEVELOPMENT CORPORATION,
G.R No. 190706, July 21, 2014. J. PERLAS-BERNABE
St. Francis Development Corporation SFDC uses the mark ST. FRANC)S to
identify numerous development projects at Ortigas Center. When Shang Properties
Realty (SPR) used the marks The St. Francis Towers and The St. Francis ShangriLa Place, SFDC filed a complaint for intellectual property violation for unfair
competition and damages.
For unfair competition to be established, there must be a showing that SPR
employed means to induce the public towards a false belief that it was offering
SFDC s goods/services. Here, this was not proven.
On the contrary, the Court upheld SPR s use of the St. Francis mark since the use
was meant not to ride on SFDC s goodwill, but merely to identify, or at least
associate, their real estate project/s with its geographical location. In the real estate
business, here can be no description of its geographical origin as precise and
accurate as that of the name of the place where they are situated.
ILLAWARE PRODUCTS CORPORATION V JESICHRIS MANUFACTURING
CORPORATION, G.R No. 195549, September 3, 2014. J. PERALTA
In order to qualify the competition as "unfair," it must have two characteristics: (1)
it must involve an injury to a competitor or trade rival, and (2) it must involve acts
which are characterized as "contrary to good conscience," or "shocking to judicial
sensibilities," or otherwise unlawful; in the language of our law, these include force,
intimidation, deceit, machination or any other unjust, oppressive or high-handed
101
method. The public injury or interest is a minor factor; the essence of the matter
appears to be a private wrong perpetrated by unconscionable means.
It is evident that petitioner Willaware is engaged in unfair competition as shown by
his act of suddenly shifting his business from manufacturing kitchenware to plasticmade automotive parts; his luring the employees of the respondent to transfer to his
employ and trying to discover the trade secrets of the respondent.
ABS-CBN CORPORATION, vs. FELIPE GOZON, GILBERTO R. DUAVIT, JR.,
MARISSA L. FLORES, JESSICA A. SOHO, GRACE DELA PEA-REYES, JOHN OLIVER
T. MANALASTAS, JOHN DOES AND JANE DOES, G.R. No. 195956, March 11, 2015,
J. Leonen
Several employees of GMA-7 were charged with copyright infringement. ABS-CBN
claims that news footage is subject to copyright and prohibited use of copyrighted
material is punishable under the Intellectual Property Code. It argues that the new
footage is not a "newsworthy event" but "merely an account of the arrival of Angelo
dela Cruz in the Philippines the latter being the newsworthy event".
The Supreme Court held that the news footage is copyrightable. he news footage is
copyrightable.
The Intellectual Property Code is clear about the rights afforded to authors of
various kinds of work. Under the Code, "works are protected by the sole fact of their
creation, irrespective of their mode or form of expression, as well as of their content,
quality and purpose." These include "[audio-visual works and cinematographic
works and works produced by a process analogous to cinematography or any
process for making audiovisual recordings."
It is true that under Section 175 of the Intellectual Property Code, "news of the day
and other miscellaneous facts having the character of mere items of press
information" are considered unprotected subject matter. However, the Code does
not state that expression of the news of the day, particularly when it underwent a
creative process, is not entitled to protection.
GMA-7's rebroadcast of ABS-CBN's news footage without the latter's consent is not
an issue. The mere act of rebroadcasting without authority from the owner of the
broadcast gives rise to the probability that a crime was committed under the
Intellectual Property Code.
Respondents cannot invoke the defense of good faith to argue that no probable
cause exists.Infringement under the Intellectual Property Code is malum prohibitum.
The Intellectual Property Code is a special law.
TAIWAN KOLIN CORPORATION, LTD VS. KOLIN ELECTRONICS CO., INC G.R. No.
209843. March 25, 2015, J. Velasco Jr.
102
The issue to be resolved in the case at bar is whether or not petitioner is entitled to
its trademark registration of KOL)N over its specific goods of television sets and
DVD players. Petitioner postulates, in the main, that its goods are not closely related
to those of Kolin Electronics. On the other hand, respondent hinges its case on the
CA s findings that its and petitioner s products are closely-related. Thus, granting
petitioner s application for trademark registration, according to respondent, would
cause confusion as to the public.
The Supreme Court held that identical marks may be registered for products for the
same classification. Mere uniformity in categorization, by itself, does not
automatically preclude the registration of what appears to be an identical mark, if
that be the case. In fact, SC, in a long line of cases, has held that such circumstance
does not necessarily result in any trademark infringement. It is hornbook doctrine
that emphasis should be on the similarity of the products involved and not on the
arbitrary classification or general description of their properties or characteristics.
The mere fact that one person has adopted and used a trademark on his goods
would not prevent the adoption and use of the same trademark by others on
unrelated articles of a different kind.
It is erroneous to conclude that all electronic products are related and that the
coverage of one electronic product necessarily precludes the registration of a
similar mark over another. In this digital age wherein electronic products have not
only diversified by leaps and bounds, and are geared towards interoperability, it is
difficult to assert readily, as respondent simplistically did, that all devices that
require plugging into sockets are necessarily related goods. In addition, Supreme
court rule that there is no confusing similarity between the marks, given that the
products covered by the trademark, i.e., jeans, were, at that time, considered pricey,
typically purchased by intelligent buyers familiar with the products and are more
circumspect, and, therefore, would not easily be deceived.Hence, petitioner's
trademark registration not only covers unrelated good, but is also incapable of
deceiving the ordinary intelligent buyer.
OBLIGA TIONS
I. DEFINITION
MAKATI STOCK EXCHANGE vs. CAMPOS, G.R. NO. 138814, April 16,
2009
Respondent used the terms "right and obligation" in his Petition from
which he concluded that that such Petition sufficiently states a cause of
action. Right and obligation are legal terms with specific legal meaning;
103
For failure to pay on time the amortization, SSS imposed the 12%
penalty contained in the penal clause of the contract entered into
between the parties. Inpositive obligations, (to give and to do), the
penalty is demandable when the debtor is in mora; hence, the necessity
of demand by the debtor unless the same is excused.
104
2. CIVIL OBLIGATIONS
ANSAY vs. NDC, G.R. NO. L-13667, April 29, 1960
Delfin, the father, was held jointly and severally liable with his minor son
Dante arising from the criminal act committed by the latter. The civil
liability which the law imposes upon the father and, in case of his death
or incapacity, the mother, for any damages that may be caused by the
minor children who live with them, is a necessary consequence of the
parental authority they exercise over them which imposes upon the
parents the "duty of supporting them, keeping them in their company,
educating them in proportion to their means", while, on the other hand,
gives them the "right to correct and punish them in moderation" .
2. OBLIGATIONS ARISING FROM CONTRACTS
106
METROPOLITAN BANK AND TRUST COMPANY vs. ANA GRACE ROSALES AND
YO YUK TO, G.R. No. 183204, January 13, 2014 J. del Castillo
Petitioner bank uses as basis for its refusal The (old Out clause found in the
agreement it entered into with respondents. The Supreme Court held that the (old
Out clause applies only if there is a valid and existing obligation arising from any of
the sources of obligation enumerated in Article 115779of the Civil Code, to wit: law,
contracts, quasi-contracts, delict, and quasi-delict. No such ground exists in this
case, hence the bank is guilty of breach of contract when it unjustifiably refused to
release respondents deposit despite demand.
SALUDAGA vs. FEU, G.R. NO. 179337 April 30, 2008
Cruz alleged that Tuason had been enriched at the expense of Cruz by
virtue of an agreement made by Cruz and the Deudors in the clearing,
improving, subdividing and selling the large tract of land for the reasons
that said improvements are being used and enjoyed by Tuason. A
107
B. SOLUTIO INDEBITI
ANDRES vs. M ANUFACTURERS HANOVER & TRUST CORPORATION,
G.R. NO. 82670 September 15, 1989
The City Treasurer of Manila refused to refund the retail dealer's tax
erroneously paid by the petitioner on it's belief that it was not exempted
from such, on the ground that the tax was voluntarily paid and not
under protest which was a condition sine qua non in order that a legal
basis may arise. Voluntariness is incompatible with mistake being a
108
NPC as a result of its inability to maintain the level of water in its dam
brought damages to defendants but asserts that the damages, if any,
were due to the heavy rains and should be regarded as a fortuitous
event.
Negligence or imprudence is human factor which makes the
whole occurrence humanized, as it were, and removed from the rules
applicable to acts of God
JIMENEZ vs. CITY OF M ANILA, G.R. NO. 71049, M ay 29, 1987
City of Manila is likewise liable for damages under Article 2189 of the
Civil Code, respondent City having retained control and supervision over
the Sta. Ana Public Market and as tort-feasor under Article 2176 of the
Civil Code on quasi-delicts Respondent City of Manila and Asiatic
Integrated Corporation being joint tort-feasors are solidarily liable under
Article 2194 of the Civil Code.
JIMENEZ vs. CITY OF M ANILA, G.R. NO. 71049, M ay 29, 1987
Petitioner fell into the open drainage holes, causing him physical
injuries, in a public market being managed by Asiatic Integrated
Corporation but such public market is still under the control and
supervision of the City of Manila. As a defense against liability on the
basis of a quasi-delict, one must have exercised the diligence of a good
father of a family. (Art. 1173 of the Civil Code).
VI. NATURE AND EFFECTS OF OBLIGATION
A. OBLIGATION TO GIVE A DETERM INATE THING vs A GENERIC
THING
SANCHEZ vs. RIGOS, G.R. NO. L-25494 June 14, 1972
that the genus of a thing can never perish, (Genus nunquan perit) and
an obligation to pay money is generic; therefore, it is not excused by
fortuitous loss of any specific property of the debtor.
GAISANO CAGAYAN, INC. vs INSURANCE COMPANY OF NORTH
AMERICA, G. R. NO. 147839, June 8, 2006
Petitioners argument is that it is not liable for the unpaid accounts
because the fire is a fortuitous event. The rule that an obligor should be
held exempt from liability when the loss occurs thru a fortuitous event
only holds true when the obligation consists in the delivery of a
determinate thing and there is no stipulation holding him liable even in
case of fortuitous event and it does not apply when the obligation is
pecuniary in nature.
B. FAILURE OF PERFORMANCE
ART 1170
ARRIETA vs. NARIC, G.R. NO. L-15645, January 31, 1964
It is clear upon the records that the sole and principal reason for the
cancellation of the allocation of rice contracted by the appellee herein in
Burma, was the failure of the letter of credit to be opened by NARIC
within the contemplated period which resulted in the consequent
damage. Every debtor who fails in performance of his obligations due to
fraud, negligence, or delay is bound to indemnify for the losses and
damages caused thereby.
TELEFAST vs. CASTRO, G.R. NO. 73867, February 29, 1988
112
Petitioners contend that they have fully complied with their obligation
under the Memorandum of Agreement but due to respondents failure to
increase the capital stock of the corporation to an amount that will
accommodate their undertaking, it had become impossible for them to
perform their end of the Agreement. In reciprocal obligations, failure of
the other party to perform the obligation renders the other party to
demand fulfillment of the obligation or asked for the rescission of the
contract, but not simply not performing their part of the Agreement.
D. NEGLIGENCE
1. DEGREE OF DILIGENCE
SICAM vs. JORGE, G.R. NO. 159617, August 8, 2007
Sicam exempts himself from liability on the ground that the robbery of
his pawnshop is a fortuitous event which is by definition is an
extraordinary event not foreseeable or avoidable. In order for a fortuitous
event to exempt one from liability, it is necessary that one has committed
no negligence or misconduct that may have occasioned the loss and
robbery per se, just like carnapping, is not a fortuitous event for it does
not foreclose the possibility of negligence on the part of herein
petitioners.
MERALCO vs. RAM OY, G.R. NO. 158911, M arch 4, 2008
113
NAKPIL & SONS v. CA, G.R. NO. L-47851 April 15, 1988
114
There was an earthquake which caused the building heavy damage but
the other nearby structures had less damages as compared to the said
building, the architects, engineers and contractors are claiming
fortuitous event as a defense. To be exempt from liability due to an act of
God, the ff must occur:
1) cause of breach must be independent of the will of the debtor
2) event must be unforeseeable or unavoidable
3) event must be such that it would render it impossible for the debtor to
fulfill the obligation
4) debtor must be free from any participation or agG.R.avation of the
industry to the creditor.
3. EXTRAORDINARY INFLATION
ALMEDA vs. BATHALA MARKETING,G.R.NO.150806, January 28,
2008
The lower court denied petitioners right to pass on to respondent the
burden of paying the VAT and their right to collect the demanded
increase in rental, there being no extraordinary inflation or devaluation
as provided for in the seventh clause of the contract. Extraordinary
inflation exists when there is a decrease or increase in the purchasing
power of the Philippine currency which is unusual or beyond the
common fluctuation in the value of said currency, and such increase or
decrease could not have been reasonably foreseen or was manifestly
beyond the contemplation of the parties at the time of the establishment
of the obligation.
A. PURE OBLIGATIONS
ART 1179
HONGKONG AND SHANGHAI BANKING CORP. vs. BROQUEZA, G.R.
NO. 178610 November 17, 2010
Respondents executed undated promissory notes. They were not able to
pay the monthly amortizations of their respective loans, which were
suppose to be paid through salary deduction, to the petitioner because of
their dismissal. Loans secured by their future retirement benefits to
which they are no longer entitled are reduced to unsecured and pure civil
obligations and the absence of a period within which to pay the
obligation, the fulfillment of which is demandable at once.
PAY vs. PALANCA, G.R. NO. L-29900June 28, 1974
In view of our finding in the present case that the aG.R.eement between
the parties is a contract to sell, it follows that the appellate court erred
when it decreed that a judicial rescission of said aG.R.eement was
necessary. In a contract to sell, the payment of the purchase price is a
positive suspensive condition and failure to pay the price agreed upon is
not a mere breach, casual or serious, but a situation that prevents the
obligation of the vendor to convey title from acquiring an obligatory force.
CONDITION PRECEDENT
PARKS vs. PROVINCE OF TARLAC, G.R. NO. L -24190, July 13, 1926
RESOLUTORY CONDITION
ART 1181
CENTRAL PHILIPPINE UNIVERSITY vs. CA, G.R. NO. 112230. July
17, 1995
118
Petitioner claimed that respondents are liable for the whole amount of
their debt and the interest thereon, after they defaulted on the monthly
installments, due to acceleration clause therein. Respondents, on the
other hand, countered that the installments were not yet due and
demandable, evidenced by the blank space left for the date on which the
installments should have commenced and theorized that fulfillment of
the obligation is dependent on the sole will of the debtor, hence proper
court should first fix a period for payment. The act of leaving blank the
due date of the first installment did not necessarily mean that the
debtors were allowed to pay as and when they could, since the presence
of an acceleration clause and a late payment penalty, showed the
intention of the parties that the installments should be paid at a definite
date, this is an obligation with a period.
LIM vs.PEOPLE OF THE PHILIPPINES, G.R. NO. L -34338 November
21, 1984
Petitioner seeks the reversal of the decision of the lower court which
convicted her of the crime of Estafa when she failed to give the proceeds
of the sale of the tobacco in accordance with their agreement which says
that ''...payment should be given as soon as the tobaccos are sold...'' and
contended that the court should first fix the period. It is clear in the
aG.R.eement, that the obligation was immediately demandable as soon
as the tobacco was disposed of hence, Article 1197 of the New Civil Code,
which provides that the courts may fix the duration of the obligation if it
does not fix a period, does not apply.
ART 1197
ARANETA, INC., vs.PHILIPPINE SUGAR ESTATES, G.R. NO. L-22558
May 31, 1967
Araneta, who was not able to comply with his obligation to create side
streets on the sides of the land which were sold to the PSE due to the
presence of squatters, questions the decision of the lower court ordering
him to comply with his obligation within 2 years from the finality of the
decision. It must be recalled that Article 1197 of the Civil Code involves a
two-step process, the Court must first determine that "the obligation
does not fix a period", or from the nature and the circumstances it can be
inferred that a period was intended, because courts can not fix a period
merely because in its opinion it is or should be reasonable and the
119
complaint not having sought that the court should set a period, but must
set the time that the parties are shown to have intended.
4. OBLIGATIONS W ITH A PENAL CLAUSE
SSS vs. MOONWALK DEVELOPMENT & HOUSING CORPORATION,
G.R. NO. 73345, April 7, 1993.
Is the penalty demandable even after the extinguishment of the principal
obligation? For all purposes the principal obligation of defendantappellee was deemed extinguished as well as the accessory obligation of
real estate mortgage, the penal clause which is also an accessory
obligation must also be deemed extinguished, it would be otherwise, if
the demand for the payment of the penalty was made prior to the
extinguishment of the obligation because by then the debtor would be in
mora and therefore liable for the penalty.
THE BACHRACH M OTOR CO., INC., vs. ESPIRITU, G.R. NO. L -28497
November 6, 1928
Defendant alleged that the decision of the lower court to pay 25 percent
of the amount of the trucks in addition to the amount of the trucks plus
12 per cent per annum is unconscionable and exceeds the rate fixed by
law. The penalty agreed upon does not include the interest, and which
may be demanded separetely and the penalty is not to be added to the
interest for the determination of whether the interest exceeds the rate
fixed by the law, since said rate was fixed only for the interest.
ROBES-FRANCISCO REALTY & DEVELOPMENT CORPORATION vs.
CFI, G.R. NO. L-41093, October 30, 1978
GOLDEN VALLEY EXPLORATION, INC. vs. PINKIAN MINING COMPANY and COPPER
VALLEY, INC., G.R. No. 190080, June 11, 2014, J. Perlas-Bernabe
)n reciprocal obligations, either party may rescind the contract upon the other s
substantial breach of the obligation/s he had assumed thereunder. The basis
therefor is Article 1191 of the Civil Code. PMC rescinded the operating agreement
with GVEI due to failure of the latter to advance payment for actual cost. The court
ruled that in reciprocal obligations, either party may rescind the contract upon the
other s substantial breach of the obligation/s he had assumed thereunder.
SWIRE REALTY DEVELOPMENT CORPORATION vs. JAYNE YU, G.R. No.
207133, March 09, 2015, J. Peralta
The right of rescission of a party to an obligation under Article 1191 of the Civil
Code is predicated on a breach of faith by the other party who violates the
reciprocity between them. The breach contemplated in the said provision is the
obligor s failure to comply with an existing obligation. When the obligor cannot
comply with what is incumbent upon it, the obligee may seek rescission and, in the
absence of any just cause for the court to determine the period of compliance, the
court shall decree the rescission. Thus, the delay in the completion of the project as
well as of the delay in the delivery of the unit are breaches of statutory and
contractual obligations which entitle respondent to rescind the contract, demand a
refund and payment of damages.
AGCAOILI vs. GSIS, G.R. NO. L-30056, August 30, 1988
Petitioners contend that they have fully complied with their obligation
under the Memorandum of Agreement but due to respondents failure to
increase the capital stock of the corporation to an amount that will
accommodate their undertaking, it had become impossible for them to
perform their end of the Agreement. In reciprocal obligations, failure of
the other party to perform the obligation renders the other party to
121
PNB assails the order of dismissal of the lower court dismissing its
complaint against several solidary debtors on the gr.ound that one of the
defendants died during the pendency of the case and therefore the
complaint, being a money claim based on contract, should be prosecuted
in the testate or intestate proceeding for the settlement of the estate of
the deceased. The choice is undoubtedly left to the solidary creditor to
determine against whom he will enforce collection and in case of the
death of one of the solidary debtors, the creditor may, if he so chooses,
proceed against the surviving solidary debtors without necessity of filing
a claim in the estate of the deceased debtors.
JOINT OBLIGATIONS
TOPIC: JOINT and SOLIDARY OBLIGATIONS
RONQUILLO vs.CA, G.R. NO. L-55138September 28, 1984
Philtranco Bus has been held solidarily liable with its bus driver, Calang,
when Calang accidentally collided with a jeepney killing a bystander and
two jeepney passengers while other passengers were seriously injured.
Since the cause of action against Calang was based on delict, Philtranco
cannot be held jointly and severally liable with Calang, based on quasidelict under Articles 2176 and 2180 of the Civil Code which pertain to
the vicarious liability of an employer for quasi-delicts that an employee
has committed.
IX. EXTINGUISHMENT OF OBLIGATIONS
MODES OF EXTINGUISHING OBLIGATIONS
SAURA IMPORT and EXPORT CO., INC. vs. DEVELOPMENT BANK OF
THE PHILIPPINES, G.R. NO. L-24968
April 27, 1972
RFC turned down the request of Saura, Inc. for an additional loan which
prompted Saura, Inc. to ask that the mortgage be cancelled, which was
done. The action thus taken by both parties was in the nature mutual
desistance what Manresa terms "mutuo disenso" which is a mode of
extinguishing obligations, a concept that derives from the principle that
since mutual aG.R.eement can create a contract, mutual disaG.R.eement
by the parties can cause its extinguishment.
124
Under Article 1256, the only instances where prior tender of payment is excused
are: (1) when the creditor is absent or unknown, or does not appear at the place of
payment; (2) when the creditor is incapacitated to receive the payment at the time it
is due; (3) when, without just cause, the creditor refuses to give a receipt; (4) when
two or more persons claim the same right to collect; and (5) when the title of the
obligation has been lost. None of these instances are present in the instant case.
Hence, the fact that the subject lots are in danger of being foreclosed does not
126
127
Apart from the initial installment of P396.12, paid upon the execution of
the contract, the defendant religiously satisfied the monthly installments
accruing thereafter, for a period of almost eight (8) years and although
the principal obligation under the contract was P3,691.20, the total
payments made by the defendant
including stipulated interest,
aggregated P4,134.08.
If the obligation has been substantially performed in good faith, the
obligor may recover as though there had been a strict and complete
fulfillment, less damages suffered by the obligee.
ART 1240
TO W HOM PAYMENT SHOULD BE MADE
SPOUSES M INIAN0 vs. CONCEPCION, G.R. 172825, October 11,
2012
128
The promissory note in question provided on its face for payment of the
obligation in Philippine currency, but the aG.R.eement between the
parties originally involved a dollar transaction.
If there is any agreement to pay an obligation in a currency other than
Philippine legal tender, the same is null and void as contrary to public
policy, pursuant to Republic Act No. 529, and the most that could be
demanded is to pay said obligation in Philippine currency, hence, a
129
creditor herein cannot oblige the debtor to pay him in dollars, even if the
loan were given in said currency.
KALALO vs. LUZ, G.R. NO. L-27782, July 31, 1970
Appellant claims that lower court erred in declaring and holding that the
balance owing from defendant-appellant to plaintiff-appellee on the IRRI
Project should be paid on the basis of the rate of exchange of the U.S.
dollar to the Philippine peso at the time of payment of judgment. Even if
the obligation assumed by the defendant was to pay the plaintiff a sum of
money expressed in American currency, the indemnity to be allowed
should be expressed in Philippine currency at the rate of exchange at the
time of judgment rather than at the rate of exchange prevailing on the
date of defendant's breach.
LEGAL TENDER
TIBAJIA vs. CA, G.R. NO. 100290, June 4, 1993
Checks representing deposit money do not have legal tender power and
their acceptance in the payment of debts, both public and private, is at
the option of the creditor.
ROMAN CATHOLIC vs. INTERMEDIATE APPELLATE COURT, G.R.
NO. 72110. November 16, 1990.
Since a negotiable instrument is only a substitute for money and not
money, the delivery of such an instrument does not, by itself, operate as
payment. A check, whether a managers check or ordinary check, is not
legal tender, and an offer of a check in payment of a debt is not a valid
tender of payment and may be refused receipt by the obligee or creditor.
PAPA vs. VALENCIA, G.R. NO. 105188, January 23, 1998
Petitioner received the payment partly in cash and partly in check but
was not able to encash the check, and now questions the said payment
after 10 years. Respondents, on the other hand, want the petitioner to
deliver to them the owners duplicate of the title and the peaceful
possession and enjoyment of the lot in question.
The geneal rule is delivery of a check produces the effect of payment only
when it is cashed, pursuant to Art. 1249 of the Civil Code. The rule does
not apply, however, if
the debtor is prejudiced by the creditors
unreasonable delay in the presentment of the check. Acceptance of a
check implies an undertaking of due diligence in presenting it for
130
131
134
The relationship of the depositors and the Bank or similar institution is that of
creditor-debtor. Article 1980 of the New Civil Code provides that fixed, savings and
current deposits of money in banks and similar institutions shall be governed by the
provisions concerning simple loans. The bank is the debtor and the depositor is the
creditor. The depositor lends the bank money and the bank agrees to pay the
depositor on demand. The savings deposit agreement between the bank and the
135
depositor is the contract that determines the rights and obligations of the parties.
Petitioners are not liable for the deposit of the altered checks. The Bank, as the
depositary and collecting bank ultimately bears the loss. Thus, there being no
indebtedness to the Bank on the part of petitioners, legal compensation cannot take
place.Under Art. 1278 of the New Civil Code, compensation shall take place when
two persons, in their own right, are creditors and debtors of each other.
FEDERAL BUILDERS, INC. vs.FOUNDATION SPECIALISTS, INC., G.R. No. 194507,
September 8, 2014, J. Peralta
In the landmark case of Eastern Shipping Lines, Inc. v. Court of Appeals, as regards
particularly to an award of interest in the concept of actual and compensatory
damages, the rate of interest, as well as the accrual thereof, is imposed, as follows:
When the obligation is breached, and it consists in the payment of a sum of money,
i.e., a loan or forbearance of money, the interest due should be that which may have
been stipulated in writing. Furthermore, the interest due shall itself earn legal
interest from the time it is judicially demanded. In the absence of stipulation, the
rate of interest shall be 12% per annum to be computed from default, i.e., from
judicial or extrajudicial demand under and subject to the provisions of Article 1169
of the Civil Code. )n line with the recent circular of the Monetary Board of the
Bangko Sentral ng Pilipinas No. 799 (July 1, 2013), the Court has modified the
guidelines in Nacar v. Gallery Frames, wherein the interest due shall itself earn
legal interest from the time it is judicially demanded and in the absence of
stipulation, the rate of interest shall be 6% per annum to be computed from default,
i.e., from judicial or extrajudicial demand under and subject to the provisions of
Article
9 of the Civil Code. This case, however, does not involve acquiescence to
the temporary use of a party s money but a performance of a particular service,
specifically the construction of the diaphragm wall, capping beam, and guide walls
of the Trafalgar Plaza. Thus, in the absence of any stipulation as to interest in the
agreement between the parties herein, the matter of interest award arising from the
dispute in this case would actually fall under the second paragraph of the above quoted guidelines in the landmark case of Eastern Shipping Lines, which
necessitates the imposition of interest at the rate of 6%, instead of the 12% imposed
by the courts below. As to the rate of interest due thereon, however, the Court notes
that the same should be reduced to 6% per annum considering the fact that the
obligation involved herein does not partake of a loan or forbearance of money.
SOLINAP vs. DEL ROSARIO, G.R. No. L-50638 July 25, 1983
For compensation to take place, it is required that the amount involved
be certain and liquidated. Compensation cannot take place where one's
claim against the other is still the subject of court litigation.
ART 1980
BPI vs CA, G.R. NO. 136202, January 25, 2007
136
The award for attorney's fees is made in favor of the litigant, not of his
counsel, hence, it is the litigant, not his counsel, who is the judgment
creditor and who may enforce the judgment by execution, such credit,
therefore, may properly be the subject of legal compensation.
ART 1278
PNB vs VDA. DE ONG ACERO, G.R. NO. L-69255, February 27, 1987
PNB's main thesis is that when it opened a savings account for ISABELA,
it (PNB) became indebted to ISABELA, so that when ISABELA itself
subsequently came to be indebted to it on account of ISABELA's breach
of the terms of the Credit Agreement, ISABELA and PNB became at the
same time creditors and debtors of each other, thus compensation
automatically took place between them, in accordance with Article 1278
of the Civil Code.
Compensation shall take when two persons, in their own right, are
creditors and debtors of each other and that compensation may transpire
by operation of law, as when all the requisites therefor, set out in Article
1279, are present. Nonetheless these legal provisions can not apply if it
has not proven by competent evidence that PNB is a creditor of ISABELA.
FRANCIA vs. IAC, G.R. NO. L-67649 June 28, 1988
137
Francia contends that his tax delinquency has been extinguished by legal
compensation and claims that the government owed him when a portion
of his land was expropriated, hence, his tax obligation had been set-off
by operation of law.
The general rule based on grounds of public policy is well-settled that no
set-off admissible against demands for taxes levied for general or local
governmental purposes because taxes are not in the nature of contracts
between the party and party but grow out of duty to, and are the positive
acts of the government to the making and enforcing of which, the
personal consent of individual taxpayers is not required.
SYCIP vs. HONORABLE COURT OF APPEALS, G.R. NO. L -38711,
January 31, 1985
Petitioner also claimed that it has the right to apply or set off private
respondent's money market claim despite the fact that the validity of the
extrajudicial foreclosure sale and petitioner's claim for deficiency are still
in question.
Article 1279 of the Civil Code requires among others, that in order that
legal compensation shall take place, "the two debts be due" and "they be
liquidated and demandable", because compensation is not proper where
the claim of the person asserting the set-off against the other is not clear
nor liquidated.
MONDRAGON vs. SOLA, JR., G.R. NO. 174882 January 21, 2013
equivalent value. When petitioner Arco Pulp and Paper tendered a check to Lim in
partial payment for the scrap papers, they exercised their option to pay the price.
This choice was also shown by the terms of the memorandum of agreement which
declared in clear terms that the delivery of petitioner Arco Pulp and Paper s finished
products would be to a third person, thereby extinguishing the option to deliver the
finished products of equivalent value to respondent. The trial court erroneously
ruled that the execution of the memorandum of agreement constituted a novation of
the contract between the parties. Novation extinguishes an obligation between two
parties when there is a substitution of objects or debtors or when there is
subrogation of the creditor. The consent of the creditor must be secured for the
novation to be valid. In this case, Lim was not privy to the memorandum of
agreement, thus, his conformity to the contract need not be secured. If the
memorandum of agreement was intended to novate the original agreement between
the parties, respondent must have first agreed to the substitution of Eric Sy as his
new debtor.
THE WELLEX GROUP, INC. vs. U-LAND AIRLINES, CO., LTD., G.R. No. 167519.
January 14, 2015, J. Leonen
Because novation requires that it be clear and unequivocal, it is never presumed.
The parties did not enter into any subsequent written agreement that was couched
in unequivocal terms. The transaction of the First Memorandum of Agreement
involved large amounts of money from both parties. Any subsequent agreement
would be expected to be clearly agreed upon with their counsels assistance and in
writing, as well. Thus there was no express novation. There was also no implied
novation of the original obligation. There was no incompatibility between the
original terms of the First Memorandum of Agreement and the remittances ma de by
respondent U-Land for the shares of stock. These remittances were actually made
with the view that both parties would subsequently enter into a share purchase
agreement. It is clear that there was no subsequent agreement inconsistent with the
provisions of the First Memorandum of Agreement.
FORT BONIFACIO DEVELOPMENT CORPORATION vs. VALENTIN L. FONG., G.R.
No. 209370, March 25, 2015, J. Perlas-Bernabe
By virtue of the Deed of Assignment, the assignee is deemed subrogated to the rights
and obligations of the assignor and is bound by exactly the same conditions as those
which bound the assignor. Accordingly, an assignee cannot acquire greater rights
than those pertaining to the assignor. The general rule is that an assignee of a non negotiable chose in action acquires no greater right than what was possessed by his
assignor and simply stands into the shoes of the latter.55 Applying the foregoing,
the Court finds that MS Maxco, as the Trade Contractor, cannot assign or transfer
any of its rights, obligations, or liabilities under the Trade Contract without the
written consent of FBDC.
140
141
inability or insolvency of the new debtor, hence, the creditor should agree
to accept the substitution in order that it may be binding on him.
CALIFORNIA BUS LINES, INC. vs. STATE INVESTMENT HOUSE, INC.,
G.R. NO. 147950. December 11, 2003
Rescission under Article 1191 takes place through either of two modes: (1) through
an extrajudicial declaration of rescission; or (2) upon the grant of a judicial decree of
rescission.
Extrajudicial declaration of rescission is recognized as a power which does not
require judicial intervention. If the rescission is not opposed, extrajudicial
142
declaration of rescission produces legal effect such that the injured party is already
relieved from performing the undertaking. However, the power of declaring
extrajudicial rescission conferred upon the injured party is regulated by the Civil
Code. If the extrajudicial rescission is impugned by the other party, it shall be
subject to a judicial determination where court action must be taken, and the
function of the court is to declare the rescission as having been properly or
improperly made, or to give a period within which the debtor must perform the
obligation alleged to be breached. A unilateral cancellation of a contract may be
questioned in courts by the affected party to determine whether or not cancellation
is warranted. Thus, in an extrajudicial decree of rescission, revocation canno t be
completely exercised solely on a party s own judgment that the other has committed
a breach of the obligation but always subject to the right of the other party to
judicially impugn such decision.
METROPOLITAN BANK AND TRUST COMPANY VS. WILFRED N. CHIOK/
BANK OF THE PHILIPPINE ISLANDS VS. WILFRED N. CHIOK/ GLOBAL
BUSINESS BANK INC.
VS.
WILFRED N. CHIOK G.R. Nos.
172652/175302/175394. November 26, 2014 J. LEONARDO-DE CASTRO
The injured party may choose between the fulfilment and the rescission of the
obligation, with the payment of damages in either case. He may also seek rescission,
even after he has chosen fulfilment, if the latter should become impossible.
The court shall decree the rescission claimed, unless there be just cause authorizing
the fixing of a period. This is understood to be without prejudice to the rights of
third persons who have acquired the thing, in accordance with Articles 1385 and
1388 and the Mortgage Law.
The cause of action supplied by the above article, however, is clearly predicated
upon the reciprocity of the obligations of the injured party and the guilty party.
Reciprocal obligations are those which arise from the same cause, and in which each
party is a debtor and a creditor of the other, such that the obligation of one is
dependent upon the obligation of the other. They are to be performed
simultaneously such that the performance of one is conditioned upon the
simultaneous fulfillment of the other. When Nuguid failed to deliver the agreed
amount to Chiok, the latter had a cause of action against Nuguid to ask for the
rescission of their contract. On the other hand, Chiok did not have a cause of action
against Metrobank and Global Bank that would allow him to rescind the contracts of
sale of the manager s or cashier s checks, which would have resulted in the crediting
of the amounts thereof back to his accounts.
THE WELLEX GROUP, INC. vs. U-LAND AIRLINES, CO., LTD., G.R. No. 167519.
January 14, 2015, J. Leonen
143
Wellex and U-Land bound themselves to negotiate with each other within a 40-day
period to enter into a share purchase agreement. If no share purchase agreement
was entered into, both parties would be freed from their respective undertakings.
For Article 1191 to be applicable, however, there must be reciprocal prestations as
distinguished from mutual obligations between or among the parties. A prestation is
the object of an obligation, and it is the conduct required by the parties to do or not
to do, or to give. Parties may be mutually obligated to each other, but the prestations
of these obligations are not necessarily reciprocal. The reciprocal prestations must
necessarily emanate from the same cause that gave rise to the existence of the
contract. U-Land correctly sought the principal relief of rescission or resolution
under Article 1191. The obligations of the parties gave rise to reciprocal prestations,
which arose from the same cause: the desire of both parties to enter into a share
purchase agreement that would allow both parties to expand their respective airline
operations in the Philippines and other neighboring countries.
SWIRE REALTY DEVELOPMENT CORPORATION VS. JAYNE YU. G.R. No. 207133.
March 9, 2015, J. PERALTA
Based on the ocular inspection conducted on the subject condominium project and
subject unit shows that the amenities under the approved plan have not yet been
provided as of May 3, 2002, and that the subject unit has not been delivered to
respondent as of August 28, 2002, which is beyond the period of development of
December 1999 under the license to sell. Incontrovertibly, petitioner had incurred
delay in the performance of its obligation amounting to breach of contract as it
failed to finish and deliver the unit to respondent within the stipulated period. The
delay in the completion of the project as well as of the delay in the delivery of the
unit are breaches of statutory and contractual obligations which entitle respondent
to rescind the contract under Article 1191, demand a refund and payment of
damages.
UNIVERSAL FOOD CORPORATION vs. CA, G.R. NO. L -29155, M ay 13,
1970
Respondent patentee was dismissed as the permanent chief chemist of
the corporation without any fault or negligence on his part after the
execution of the Bill of Assignment, prompting him to rescind the
contract. The general rule is that rescission of a contract will not be
permitted for a slight or casual breach, but only for such substantial and
fundamental breach as would defeat the very object of the parties in
making the agreement.
ART 1191
DEL CASTILLO Vda. DE M ISTICA vs. SPOUSES NAGUIAT, G.R. NO.
137909, December 11, 2003
144
In the present case, the failure of respondents to pay the balance of the
purchase price within ten years from the execution of the Deed did not
amount to a substantial breach. Under Article 1191 of the Civil Code,
the right to rescind an obligation is predicated on the violation of the
reciprocity between parties, brought about by a breach of faith by one of
them however, rescission is allowed only where the breach is substantial
and fundamental to the fulfillment of the obligation.
PALAY vs. CLAVE , G.R. NO. L-56076 September 21, 1983
145
CARTON
The CA added that even assuming that the agreement was for
respondent to deliver the boxes, respondent would not be liable for
breach of contract as petitioner had not yet demanded from it the
delivery of the boxes. Without a previous demand for the fulfillment of
the obligation, petitioner would not have a cause of action for rescission
against respondent as the latter would not yet be considered in breach of
its contractual obligation, since the right to rescind a contract arises
once the other party defaults in the performance of his obligation.
OSMEA III vs SSS, September 13, 2007
147
Considering that there was a lawful Order from the SEC, the contract is deemed
suspended. When a contract is suspended, it temporarily ceases to be operative; and
it again becomes operative when a condition occurs or a situation arises
warranting the termination of the suspension of the contract.
AVELINA ABARIENTOS REBUSQUILLO [substituted by her heirs, except
Emelinda R. Gualvez] and SALVADOR A. OROSCO v SPS. DOMINGO and
EMELINDA REBUSQUILLO GUALVEZ and the CITY ASSESSOR OF LEGAZPI CITY,
G.R No. 204029, June 4, 2014. J. VELASCO, JR.
148
absolutely simulated or fictitious contract is void, and the parties may recover from
each other what they may have given under the contract.
In the present case, the true intention of the parties in the execution of the Deed of
Absolute Sale is immediately apparent from respondents very own Answer wherein
they admitted that the purpose of the Deed of Absolute Sale was simply to facilitate
the titling of the subject property. considering that the Deed of Absolute Sale has
been shown to be void for being absolutely simulated, petitioners are not precluded
from presenting evidence to modify, explain or add to the terms of the written
agreement as an exception to the parol evidence rule.
I. A. DEFINITION
SPOUSES BALILA vs. IAC, G.R. NO. L-68477 October 29, 1987
ECE REALTY AND DEVELOPMENT INC. vs.RACHEL G. MANDAP, G.R. No. 196182,
September 1, 2014, J. Peralta
Article 1338 of the Civil Code provides that "[t]here is fraud when through insidious
words or machinationsof one of the contracting parties, the other is induced to enter
into a contract which, without them, he would not have agreed to."
150
152
Article 1390(2) of the Civil Code provides that contracts where the consent is
vitiated by mistake, violence, intimidation, undue influence or fraud are voidable or
annullable. Article 1335 of the Civil Code, meanwhile, states that "there is
intimidation when one of the contracting parties is compelled by a reasonable and
well-grounded fear of an imminent and grave evil upon his person or property, or
upon the person or property of his spouse, descendants or ascendants, to give his
consent." The same article, however, further states that a "threat to enforce one s
claim through competent authority, if the claim is just or legal, does not vitiate
consent."
)n this case, Ong merely informed the spouses of Edna s conviction in the criminal
cases for estafa. )t might have evoked a sense of fear or dread on Edna s part, but
certainly there is nothing unjust, unlawful or evil in Ong s act. The judgment of
conviction was a result of a valid judicial process and will not suffice to nullify the
real estate mortgages and the subsequent foreclosure of the mortgaged properties.
No proof was adduced to show that Ong used [force], duress, or threat to make Edna
execute the real estate mortgages.
MARIANO C. MENDOZA and ELVIRA LIM v SPOUSES LEONORA J. GOMEZ and
GABRIEL V. GOMEZ, G.R No. 160110, June 18, 2014. J. PEREZ
Article 2211 of the Civil Code provides that in crimes and quasi-delicts, interest as
part of the damage, may, in a proper case, be adjudicated in the discretion of the
court. Generally, interest is allowed as a matter of right for failure to pay liquidated
claims when due. For unliquidated claims, however, Article 2213 of the Civil Code
provides that interest cannot be recovered upon unliquidated claims or damages,
except when the demand can be established with reasonable certainty. In this case,
the Court allowed the award of interest on the actual and compensatory damages
based on justice, and because these damages could be measured against a
reasonably certain standard.
SPOUSES EDUARDO and LYDIA SILOS v PHILIPPINE NATIONAL BANK, G.R No.
181045, July 2, 2014. J. DEL CASTILLO
From 1987 to 1998, the spouses Silos executed promissory notes in favor of PNB, as
well as real estate mortgages to secure the loan. The loan contracts contained an
escalation clause: The Borrower agrees that the Bank may modify the interest rate
in the Loan depending on whatever policy the Bank may adopt in the future,
including without limitation, the shifting from the floating interest rate system to
the fixed interest rate system, or vice versa and the Borrower hereby agrees that
the Bank may, without need of notice to the Borrower, increase or decrease its
spread over the floating interest rate at any time depending on whatever policy it
may adopt in the future.
153
The Court held that the escalation clause in the loan contract was null and void for
being violative of mutuality of contracts. Any modification in the contract, such as
the interest rates, must be made with the consent of the contracting parties. The
minds of all the parties must meet as to the proposed modification, especially when
it affects an important aspect of the agreement. In the case of loan agreements, the
rate of interest is a principal condition, if not the most important component. Thus,
any modification thereof must be mutually agreed upon; otherwise, it has no
binding effect.
LAND BANK vs. HEIRS OF SPOUSES SORIANO, G.R. NO. 178312.
January 30, 2012
Pending resolution of the case, both parties freely and voluntarily entered
into an agreement for the purpose of finally settling their dispute in this
case. As a contract, a compromise is perfected by mutual consent,
however, a judicial compromise, while immediately binding between the
parties upon its execution, is not executory until it is approved by the
court and reduced to a judgment.
LAGUNZAD vs. VDA. DE GONZALES, G.R. NO. L -32066 August 6,
1979
Petitioner takes the position that he was pressured into signing the
Agreement because of private respondent's demand, for payment for the
"exploitation" of the life story of Moises Padilla, otherwise, she would "call
a press conference declaring the whole picture as a fake, fraud and a
hoax and would denounce the whole thing in the press, radio, television
and that they were going to Court to stop the picture." It is necessary to
distinguish between real duress and the motive which is present when
one gives his consent reluctantly because a contract is valid e ven though
one of the parties entered into it against his own wish and desires, or
even against his better judgment.
154
The defendants admitted the principal obligation but claimed that the
additional amount constituted usurious interest. Under Article 1354 of
the Civil Code, the agreement of the parties relative to the additional
amount is presumed to exist and is lawful, unless the debtor proves the
contrary. Since no evidentiary hearing had been held, the defendants
therefore had not proven that the obligation was illegal.
C. CONSIDERATION
ART. 1354
PENTACAPITAL INVESTMENT CORPORATION vs. M AHINAY, G.R.
NO. 171736, July 5, 2010
155
Although the contract states that the purchase price of 2,000.00 was
paid by Policronio to Alfonso for the subject properties, it has been
proven that no such payment was made. It is well-settled that where a
deed of sale states that the purchase price has been paid but in fact has
never been paid, the deed of sale is null and void for lack of
consideration.
III. FORM ALITIES
ART 1724
DUE OBSERVANCE OF PRESCRIBED FORMALITIES
WELDON CONSTRUCTION CORPORATION vs. COURT OF APPEALS,
G.R. NO. L-35721 October 12, 1987
Petitioner Lao Sok promised to give his employees their separation pay,
as soon as he receives the insurance proceeds for his burned building,
but contends that the contract was orally made hence unenforceable
since it does not comply with the Statute of Frauds. Contracts in
whatever form they may have been entered into are binding on the
parties unless form is essential for the validity and enforceability of that
particular contract.
ART 1356
GALLARDO vs.HONORABLE INTERMEDIATE APPELLATE COURT,
G.R. NO. L-67742 October 29, 1987
156
The issue here is whether or not the unnotarized deed of sale can be
considered as a valid instrument for effecting the alienation by way of
sale of a parcel of land registerd under the Torrens System.
The general rule enunciated in said Art. 1356 is that contracts are
obligatory, in whatever form they may have been entered, provided all the
essential requisites for their validity are present, except when the law so
requires requiring a contract to be in some form for validity or
enforceability.
IV. STAGES , PERFECTION
Bugatti v. Court of Appeals, G.R. No. 138113. October 17, 2000
A contract undergoes three distinct stages preparation or negotiation,
its perfection, and finally, its consummation. Negotiation begins from
the time the prospective contracting parties manifest their interest in the
contract and ends at the moment of agreement of the parties. The
perfection or birth of the contract takes place when the parties agree
upon the essential elements of the contract. The last stage is the
consummation of the contract wherein the parties fulfill or perform the
terms agreed upon in the contract, culminating in the extinguishment
thereof.
ART 1315 , 1319
TONG BROTHERS CO., vs. IAC, G.R. NO. 73918 December 21, 1987
From the exchange of telegrams between the two parties, there was not
yet a meeting of the minds as to the cause of the contract. The cause of a
contract has been defined "as the essential reason which moves the
contracting parties to enter into it (8 Manresa, 5th Edition, p. 450). In
other words, the cause is the immediate, direct and proximate reason
which justifies the creation of an obligation thru the will of the
contracting parties (3 Castan, 4th Edition, p. 347)." (General Enterprises,
Inc. v. Lianga Bay Logging Co., Inc., 11 SCRA 733, 739). For the private
respondent, the cause of the contract was the repair of its vessel
Zamboanga-J while for the petitioner the cause would be its commitment
to repair the vessel and make it seaworthy. The telegrams dated January
17, January 20, and January 28, 1975 sent by the petitioner to the
private respondent, however, indicate that the former had not accepted
the repair of Zamboanga-J, the reason being that the extent of the repair
to be made necessitated a major expense so that the petitioner insisted
on the presence of the private respondent for evaluation before it
accepted the repair of the wooden vessel. That the petitioner had not yet
consented to the contract is e vident when on January 28, 1975, it sent a
157
law' are "inexistent and that "(T)hese contracts cannot be ratified, neither
can the right to set up the defense of illegality be waived."
ART 1410
TONGOY vs. THE HONORABLE COURT OF APPEALS, G.R. NO. L 45645 June 28, 1983
The issue in this case is whether or not the rights of herein respondents
over subject properties, which were the subjects of simulated or fictitious
transactions, have already prescribed. A void or inexistent contract is one
which has no force and effect from the very beginning, as if it had never
been entered into, and which cannot be validated either by time or by
ratification.
LITA ENTERPRISES, INC.,vs. IAC, G.R. NO. L -64693 April 27, 1984
Unquestionably, the parties herein operated under an arrangement,
commonly known as the "kabit system", whereby a person who has been
granted a certificate of convenience allows another person who owns
motors vehicles to operate under such franchise for a fee, and the
petitioner prays that private respondents be declared liable to petitioner
for whatever amount the latter has paid. It is a fundamental principle of
in pari delicto that the court will not aid either party to enforce an illegal
contract, but will leave them both where it finds them.
ARSENAL vs. IAC, G.R. NO. L-66696 July 14, 1986
Petitioner questions the validity of the sale between the respondent and
Suralta but the lower court held that the benefit of said prohibition in the
Public Land Act against the disposal of any land granted to a citizen
under that law does not inure to any third party. The right to set up the
nullity of a void or non-existent contract is not limited to the parties as in
the case of annulable or voidable contracts. The right to set up the
nullity of a void or non-existent contract is extended to third persons
who are directly affected by the contract.
MANOTOK REALTY, INC., vs. THE HON. COURT OF APPEALS, G.R.
NO. L-45038 April 30, 1987
Don Legarda sold the paraphernal property of Dona Clara to the
respondent. It was sold three months after he was appointed as
administrator of the estate of Dona Clara Tambunting. The sale between
Don Vicente Legarda and the private respondent is void ab initio, the
former being neither an owner nor administrator of the subject property,
160
and the sale cannot be the subject of the ratification by the probate
court.
PORTUGAL vs. IAC, G.R. NO. 73564 March 25, 1988
Respondent, through fraudulent means was able to transfer the lot from
his parents to himself without consideration or cause through a
purported deed of The IAC held that the action had already prescribed
because an action to annul a contract based on fraud prescribes in four
years. The SC, however, held that the alleged contract of sale is vitiated
by the total absence of a valid cause or consideration which is an
indispensable requisite for the existence of a valid contract. Thus, Article
1410 of the Civil Code provides that '(T)he action or defense for the
declaration of the inexistence of a contract does not prescribe.
PHILIPPINE BANKING CORPORATION vs. LUI SHE, G.R. NO. L 17587, September 12, 1967
The illicit purpose becomes the illegal causa rendering the contracts void.
TEJA M ARKETING vs. IAC, G.R. NO. L-65510 M arch 9, 1987
The vendor Eligio, Sr. entered into an agreement with petitioner, but that
the formers capacity to consent was vitiated by senile dementia. Insane
or demented persons cannot give consent to a contract, but if an insane
or demented person does enter into a contract, the legal effect is that the
contract is voidable or annullable.
161
Applying Articles 1317 and 1403 of the Civil Code, the Court of Appeals
ruled that through their inaction and silence, the three sons of Emilia are
considered to have ratified the aforesaid sale of the subject property by
their mother. Ratification means that one under no disability voluntarily
adopts and gives sanction to some unauthorized act or defective
proceeding, which without his sanction would not be binding on him ,
hence, an alleged silence and inaction may not be interpreted as an act
of ratification on their part.
C. UNENFORCEABLE CONTRACTS
IGLESIA FILIPINA INDEPENDIENTE vs. HEIRS of BERNARDINO TAEZA, G.R. No.
179597, February 3, 2014, J. Peralta
Unenforceable contracts are those which cannot be enforced by a proper action in
court, unless they are ratified, because either they are entered into without or in
excess of authority or they do not comply with the statute of frauds or both of the
contracting parties do not possess the required legal capacity. In the present case,
however, respondents' predecessor-in-interest, Bernardino Taeza, had already
obtained a transfer certificate of title in his name over the property in question.
Since the person supposedly transferring ownership was not authorized to do so,
the property had evidently been acquired by mistake. This case clearly falls under
the category of unenforceable contracts mentioned in Article 1403, paragraph (1) of
the Civil Code, which provides, thus: (1) Those entered into in the name of another
person by one who has been given no authority or legal representation, or who has
acted beyond his powers.
YUVIENCO vs. DACUYCUY, G.R. NO. L-55048 M ay 27, 1981
162
In the case at bar, it is undisputed that Atty. Adolfo Amor was entrusted,
as receiver, with the administration of BISTRANCO and it business, but
the act of entering into a contract is one which requires the authorization
of the court which appointed him receiver. The questioned contracts can
rightfully be classified as unenforceable for having been entered into by
one who had acted beyond his powers, due to Receiver Amor's failure to
secure the court's approval of said Contracts.
STATUTE OF FRAUDS
AINZA vs. SPOUSES PADUA, G.R. NO. 165420, June 30, 2005
Gabriel Sr., during his lifetime, sold the subject property to Antonita, the
purchase price payable on installment basis, thus, Gabriel Sr. appeared
to have been a recipient of some partial payments but after his death, his
son questions the verbal sale contract between Gabriel Sr. and Antonita,
and alleged that the contract is unenforceable for non-compliance with
the Statute of Frauds. The Statute of Frauds, in context, provides that a
contract for the sale of real property or of an interest therein shall be
unenforceable unless the sale or some note or memorandum thereof is in
writing and subscribed by the party or his agent. Where the verbal
contract of sale, howe ver, has been partially executed through the partial
payments made by one party duly received by the vendor, as in the
present case, the contract is taken out of the scope of the Statute.
HERNANDEZ vs. COURT OF APPEALS, G.R. NO. L -41132 April 27,
1988
163
Both courts were of the view essentially that the evidence did not bear
out the claim of fraud; that under the Statute of Frauds, the parties'
covenant as to their properties' metes and bounds was unenforceable
since it was not reduced to writing. Not every agreement "affecting land"
must be put in writing to attain enforceability, under the Statute of
Frauds, Article 1403(2) (e) of the Civil Code, such formality is only
required of contracts involving leases for longer than one year, or for the
sale of real property or of an interest therein.
D. RESCISSIBLE CONTRACTS
CABALIW vs. SADORRA, G.R. NO. L-25650 June 11, 1975
It is admitted by both parties that the phrase "they shall not sell to
others these three lots but only to the seller Vicente Santiago or to his
heirs or successors" is an express prohibition against the sale of the lots
described in the "Compraventa" to third persons or strangers to the
165
3. M UTUALITY OF CONTRACTS
BANCO FILIPINO SAVINGS vs. NAVARRO, G.R. NO. L -46591, July 28,
1987
Escalation clauses to be valid should specifically provide: (1) that there
can be an increase in interest if increased by law or by the Monetary
Board; and (2) in order for such stipulation to be valid, it must include a
provision for reduction of the stipulated interest "in the event that the
applicable maximum rate of interest is reduced by law or by the
Monetary Board" in order to be valid which is known as deescalation
clause.
SPOUSES FLORENDO vs. COURT OF APPEALS, G.R. NO. 101771
December 17, 1996
In order that obligations arising from contracts may have the force of law
between the parties, there must be mutuality between the parties based
on their essential equality, hence, a contract containing a condition
which makes its fulfillment dependent exclusively upon the uncontrolled
will of one of the contracting parties, is void.
ART 1308
PHILIPPINE NATIONAL BANK vs. SPOUSES AGUSTIN, G.R. NO.
164549
September 18, 2009
The spouses Rocamora posit that their loan would not have bloated to
more than double the original amount if PNB had not increased the
interest rates and had it immediately foreclosed the mortgages. Any
increase in the rate of interest made pursuant to an escalation clause
must not be left solely to the will of one of the parties, but must be the
result of a mutual agreement between the parties, hence, a de-escalation
clause that would authorize a reduction in the interest rates
corresponding to downward changes made by law or by the Monetary
Board must be included, otherwise, the change carries no binding effect.
4. RELATIVITY , PRIVITY OF CONTRACTS
DKC HOLDINGS CORPORATION vs. COURT OF APPEALS, G.R. NO.
118248
April 5, 2000
Being an heir there is privity of interest between the heir and the
deceased, hence, heirs are bound by contracts entered into by their
167
There was no express contract between the parties for the payment of
attorney's fees, but the respondent rendered legal services to petitioner.
The payment of attorney's fees to respondent may be justified by virtue of
the innominate contract of facio ut des (I do and you give which is based
on the principle that "no one shall unjustly enrich himself at the expense
of another" and under Article 1307 such contracts shall be regulated by
the stipulations of the parties, by the general provisions or principles of
obligations and contracts, by the rules governing the most analogous
nominate contracts, and by the customs of the people.
B. DIVISIBLE CONTRACTS
BRIONES vs. CAMMAYO, ET AL., G.R. NO. L-23559, October 4, 1971
168
It is the position of the petitioner that because Lee See Guat was illiterate
and spoke only Chinese, she could not be held guilty of concealment of
her health history because the applications for insurance were in English
and the insurer has not proved that the terms thereof had been fully
explained to her. The obligation to show that the terms of the contract
had been fully explained to the party who is unable to read or
169
IX.
BONIFACIO BROS., INC., ET AL., vs. M ORA, ET AL., G.R. NO. L 20853
M ay 29, 1967
The appellants seek to recover the insurance proceeds, relying upon the
insurance contract executed by and between the State Bonding &
Insurance Company, Inc. and Mora. Contracts take effect only between
the parties thereto, except where the contract contains some
stipulations, known as stipulations por atrui, in favor of a third person,
who is allowed to avail himself of a benefit granted to him by the terms of
the contract, provided that the contracting parties have clearly and
deliberately conferred a favor upon such person, however such third
person not a party to the contract has no action zagainst the parties
thereto, and cannot generally demand the enforcement of the same, if he
did not communicate his acceptance thereto to the obligor before the
revocation.
FLORENTINO vs. ENCARNACION, SR., G.R. NO. L -27696 September
30, 1977
To constitute a valid stipulation pour autrui it must be the purpose and
intent of the stipulating parties to benefit the third. It is not sufficient
that the third person may be incidentally benefited by the stipulation.
G.R. NO. 120554 September 21, 1999
SO PING BUN vs. COURT OF APPEALS
170
171
CIVIL LAW
PART II
SAL ES
I. DEFINITION AND ESSENTIAL REQUISITES OF A CONTRACT OF SALE
A. DEFINITION
December
December
Both the trial court and CA found that defendants' offer to sell was never
accepted by the plaintiffs for the reason that the parties did not agree upon the
terms and conditions of the proposed sale, hence, there was no contract of sale
at all. An accepted unilateral promise which specifies the thing to be sold and
the price to be paid, when coupled with a valuable consideration distinct and
separate from the price, is what may properly be termed a perfected contract of
option and not perfected contract of sale.
C. CONTRACT OF CONDITIONAL SALE
OLIVAREZ REALTY CORPORATION and DR. PABLO R. OLIVAREZ v BENJAMIN
CASTILLO, G.R No. 196251, July 9, 2014. J. LEONEN
In both contracts to sell and contracts of conditional sale, title to the property remains with
the seller until the buyer fully pays the purchase price. Both contracts are subject to the
positive suspensive condition of the buyer s full payment of the pur chase price. In a
contract of conditional sale, the buyer automatically acquires title to the property upon full
payment of the purchase price. This transfer of title is by operation of law without any
further act having to be performed by the seller. In a contract to sell, transfer of title to the
1
prospective buyer is not automatic. The prospective seller must convey title to the property
through a deed of conditional sale.
In this case, Castillo reserved his title to the property and undertook to execute a deed of
absolute sale upon Olivarez Realty Corporation s full payment of the purchase price. Since
Castillo still has to execute a deed of absolute sale to Olivarez RealtyCorporation upon full
payment of the purchase price, the transfer of title is not automatic. The contract in this
case is a contract to sell.
Since Olivarez Realty Corporation illegally withheld payments of the purchase price,
Castillo is entitled to cancel his contract with petitioner corporation. However, we properly
characterize the parties contract as a contract to sell, not a contract of conditional sale.
In both contracts to sell and contracts of conditional sale, title to the property remains with
the seller until the buyer fully pays the purchase price. Both contracts are subject to the
positive suspensive condition of the buyer s full payment of the purchase price.
In a contract of conditional sale, the buyer automatically acquires title to the property upon
full payment of the purchase price. This transfer of title is "by operation of law without any
further act having to be performed by the seller." In a contract to sell, transfer of title to the
prospective buyer is not automatic. The prospective seller must convey title to the property
[through] a deed of conditional sale."
The distinction is important to determine the applicable laws and remedies in case a party
does not fulfill his or her obligations under the contract. In contracts of conditional sale, our
laws on sales under the Civil Code of the Philippines apply. On the other hand, contracts to
sell are not governed by our law on sales but by the Civil Code provisions on conditional
obligations.
Specifically, Article 1191 of the Civil Code on the right to rescind reciprocal obligations
does not apply to contracts to sell. Failure to fully pay the purchase price in contracts to sell
is not the breach of contract under Article 1191. Failure to fully pay the purchase price is
"merely an event which prevents the [seller s] obligation to convey title from acquiring
binding force. This is because "there can be no rescission of an obligation that is still
nonexistent, the suspensive condition not having happened.
In this case, Castillo reserved his title to the property and undertook to execute a deed of
absolute sale upon Olivarez Realty Corporation s full payment of the purchase price. Since
Castillo still has to execute a deed of absolute sale to Olivarez Realty Corporation upon full
payment of the purchase price, the transfer of title is not automatic. The contract in this
case is a contract to sell.
As this case involves a contract to sell, Article 1191 of the Civil Code of the Philippines does
not apply. The contract to sell is instead cancelled, and the parties shall stand as if the
obligation to sell never existed.
enter into and thereby perfect a contract of sale in order to effectively transfer the
ownership of the subject portion from the sellers to the buyers (Spouses Roque) cannot be
deemed to have been fulfilled. Consequently, the latter cannot validly claim ownership over
the subject portion even if they had made an initial payment and even took possession of
the same.
It is essential to distinguish between a contract to sell and a conditional contract of sale
specially in cases where the subject property is sold by the owner not to the party the seller
contracted with, but to a third person, as in the case at bench. In a contract to sell, there
being no previous sale of the property, a third person buying such property despite the
fulfilment of the suspensive condition such as the full payment of the purchase price, for
instance, cannot be deemed a buyer in bad faith and the prospective buyer cannot seek the
relief of reconveyance of the property. There is no double sale in such case. Title to the
property will transfer to the buyer after registration because there is no defect in the
owner-seller s title per se, but the latter, of course, may be sued for damages by the
intending buyer.
ART 1458
TAN vs BENOLIRAO, G.R. NO. 153820. October 16, 2009
The Deed of Conditional Sale, as termed by the parties, states that "in case,
BUYER has complied with the terms and conditions of this contract, then the
SELLERS shall execute and deliver to the BUYER the appropriate Deed of
Absolute Sale". The very essence of a contract of sale is the transfer of
ownership in exchange for a price paid or promised, but where the seller
promises to execute a deed of absolute sale upon the completion by the buyer
of the payment of the price, the contract is only a contract to sell, even if it is
denominated as a Deed of Conditional Sale.
D. CONTRACT TO SELL
JUAN P. CABRERA vs. HENRY YSAAC, G.R. No. 166790, November 19, 2014, J. Leonen
Unless all the co-owners have agreed to partition their property, none of them may sell a
definite portion of the land. The co-owner may only sell his or her proportionate interest in
the co-ownership. A contract of sale which purports to sell a specific or definite portion of
unpartitioned land is null and void ab initio.
At best, the agreement between Juan and Henry is a contract to sell, not a contract of sale. A
contract to sell is a promise to sell an object, subject to suspensive conditions. Without the
fulfillment of these suspensive conditions, the sale does not operate to determine the
obligation of the seller to deliver the object.
A co-owner could enter into a contract to sell a definite portion of the property. Such
contract is still subject to the suspensive condition of the partition of the property, and that
the other co-owners agree that the part subject of the contract to sell vests in favor of the
co-owner s buyer. Hence, the co-owners consent is an important factor for the sale to
ripen.
PADILLA vs. SPOUSES PAREDES, G.R. NO. 124874, M arch 17, 2000
Under the parties contract, the property will be transferred to petitioner only
upon the latter's "complete compliance of his obligation provided in the
contract" but because of petitioners failure to fully pay the purchase price, the
obligation of private respondents to convey title to the property did not arise.
Petitioner's reliance on Article 1592 of the Civil Code is misplaced because
what this provision contemplates is an absolute sale and not a contract to sell
as in the present case.
ART 1478
CRISTOBAL vs. SALVADOR, SR., G.R. NO. 139365, September 11, 2008
The Seller executed three separate contracts on the same property with three
different parties, wherein only the first two contracts contained a stipulation
that "if the Vendee fails to pay the Vendor the sums stated within the period
stipulated and after the grace period for each payment, this contract shall
automatically be null and void and of no effect without the necessity of any
demand, and the Vendor shall have the full and exclusive right to sell to any
person. The first two contracts were both mere contracts to sell and did not
transfer ownership to either of the buyers for failure to comply with the
condition of full payment of the purchase price, hence, vendor can still validly
convey the subject property to another buyer.
E. ELEMENTS OF A VALID CONTRACT OF SALE
PEALOSA vs. SANTOS, G.R. NO. 133749, August 23, 2001
Respondent insist that the second deed is a complete nullity because a) the
consideration stated in the deed was not paid; b)seller was not present when
the deed was notarized; c) seller did not surrender a copy of the title; d)real
estate taxes were not paid. The elements of a valid contract of sale are: (1)
consent or meeting of the minds; (2) determinate subject matter; and (3) price
certain in money or its equivalent which are present in the second Deed of Sale
hence there is already a perfected contract of sale.
5
ART 1475
HEIRS OF JUAN SAN ANDRES vs. RODRIGUEZ, G.R. NO. 135634 M ay 31,
2000
Respondent alleged that there was no contract of sale to speak of, while
petitioner as proof of the sale presented a receipt stating that Andres received
from Rodriguez a sum representing an advance payment for a residential lot
with the agreed price of 15php per square meter and that the payment of the
full consideration after the survey shall be due and payable in 5 years from the
execution of the formal deed of sale. All of the essential elements of a contract
of sale are present, i.e., that there was a meeting of the minds between the
parties, by virtue of which the late Andres undertook to transfer ownership of
and to deliver a determinate thing for a price certain in money.
II. PARTIES TO A CONTRACT OF SALE
A. SELLER
SKUNAC CORPORATION and ALFONSO F. ENRIQUEZ vs. ROBERTO S. SYLIANTENG and
CAESAR S. SYLIANTENG, G.R. No. 205879, April 23, 2014, J. Peralta
Indeed, not being an heir of Luis, Romeo never acquired any right whatsoever over the
subject lots even if he was able to subsequently obtain a title in his name. It is a well-settled
principle that no one can give what one does not have, nemo dat quod non habet. One can
sell only what one owns or is authorized to sell, and the buyer can acquire no more right
than what the seller can transfer legally.
ART 1459
HEIRS OF ARTURO
November 27, 2008
REYES
vs
SOCCO-BELTRAN,
G.R.
176474
It was unmistakably stated in the Contract to Sell and made clear to both
parties thereto that the vendor was not yet the owner of the subject property
and was merely expecting to inherit the same. The law specifically requires
that the vendor must have ownership of the property at the time of delivery
hence, there was no valid sale from which ownership of the subject property
could have been transferred.
DACLAG vs. M ACAHILIG et al., G.R. NO. 159578, February 18, 2009
Petitioners contend that the 10-year period for reconveyance is applicable if the
action is based on an implied or a constructive trust. However, since
respondents' action for reconveyance was based on fraud, the action must be
filed within four years from the discovery of the fraud. Respondent's action for
reconveyance was not e ven subject to prescription, since the deed of sale that
was executed in favor of petitioners was null and void because the selle r was
not the owner of the land, nor has the authority when she sold it to petitioners,
hence, being an absolute nullity, the deed is subject to attack anytime because
an action to declare the inexistence of a void contract does not prescribe.
ART 1505
NOOL vs. COURT OF APPEALS, G.R. NO. 116635 July 24, 1997
Petitioners contend that they could repurchase the property that they "sold" to
private respondents when they allowed the respondent to redeem the properties
for them from DBP but DBP certified that the mortgagors' right of redemption
was not exercised within the period. Article 1505 of the Civil Code provides that
"where goods are sold by a person who is not the owner thereof, and who does
not sell them under authority or with consent of the owner, the buyer acquires
no better title to the goods than the seller had, unless the owner of the goods is
by his conduct precluded from denying the seller's authority to sell.", hence,
petitioners "sold" nothing, it follows that they can also "repurchase" nothing.
B. BUYER
ART 1491
DAROY vs. ATTY. ABECIA, A.C. NO. 3046, October 26, 1998
The prohibition in Art. 1491 does not apply to the sale of a parcel of land,
acquired by a client to satisfy a judgment in his favor to his counsel as long as
the property was not the subject of the litigation.
ARCENIO vs. JUDGE PAGOROGON, A.M . NO. M TJ-89-270 July 5, 1993
OFFICE OF THE COURT ADM INISTRATOR vs. JUDGE PAGOROGON, A.M .
NO. M TJ-92-637 July 5, 1993
The respondent judge engaged the services of a mechanic to tow the jeep in
custodia legis and to place the jeep in good running condition, spending in the
process her own money and also registered the same in her brother's name.
The act of respondent judge is not unlike the prohibited acquisition by
purchase described in Article 1491 of the New Civil code and is in fact, even
worse when she did not acquire the said vehicle from it's owner but instead
whimsically spent for its repairs and automatically appropriated the jeep for
her own use and benefit.
7
VALENCIA vs. ATTY. CABANTING, A.M . Nos. 1302, 1391 and 1543 April
26, 1991
Paulino alleged that the trial court failed to provide a workable solution
concerning his house and while the petition for certiorari was pending the trial
court issued an order of execution stating that "the decision in this case has
already become final and executory". While it is true that Atty. Cabanting
purchased the lot after finality of judgment, there was still a pending certiorari
proceeding, and a thing is said to be in litigation not on ly if there is some
contest or litigation over it in court, but also from the moment that it becomes
subject to the judicial action of the judge.
FABILLO vs. THE HONORABLE INTERMEDIATE APPELLATE COURT, G.R.
NO. L-68838 M arch 11, 1991
After the court declared with finality that the petitioners are the lawful owners,
they refused to comply when the respondent lawyer proceeded to implement
the contract of services between him and the petitioners by taking possession
and exercising rights of ownership over 40% of said properties which are the
subject of litigation. A contract between a lawyer and his client stipulating a
contingent fee is not covered by said prohibition under Article 1491 (5) of the
Civil Code because the payment of said fee is not made during the pendency of
the litigation but only after judgment has been rendered in the case handled by
the lawyer.
MANANQUIL vs. ATTY. VILLEGAS, A.M . NO. 2430 August 30, 1990
Complainant alleges that for over a period of 20 years, respondent counsel
allowed lease contracts to be executed between his client and a partnership of
which respondent is one of the partners, covering parcels of land of the estate,
but respondent claims that he is only acting as an agent. Even if the
respondent signed merely as an agent, the lease contracts are covered by the
prohibition against any acquisition or lease by a lawyer of properties involved
in litigation in which he takes part.
BAUTISTA vs. ATTY. GONZALES, A.M . NO. 1625 February 12, 1990
The Solicitor General found that respondent counsel transferred to himself
one-half of the properties of his clients during the pendency of the case where
the properties were involved. Persons mentioned in Art. 1491 of the Civil Code
are prohibited from purchasing the property mentioned therein because of the
existing fiduciary relationship with such property and rights, as well as with
the client.
ART 1492
IN RE: SUSPENSION FROM THE PRACTICE OF LAW IN THE TERRITORY
OF GUAM OF ATTY. LEON G. MAQUERA, B.M . NO. 793. July 30, 2004
Maquera was suspended from the practice of law in Guam for misconduct, as
he acquired his clients property by exercising the right of redemption
previously assigned to him by the client in payment of his legal services, then
sold it and as a consequence obtained an unreasonably high fee for handling
his clients case. The prohibition extends to sales in legal redemption and such
prohibition is founded on public policy because, by virtue of his office, an
attorney may easily take advantage of the credulity and ignorance of his client
and unduly enrich himself at the expense of his client.
ART 1493
PROVINCE OF CEBU vs. HEIRS OF RUFINA MORALES, G.R. NO. 170115,
FEBRUARY 19, 2008
The City of Cebu was no longer the owner of the lot when it ceded the same to
petitioner under the compromise agreement and at that time, the city merely
retained rights as an unpaid seller but had effectively transferred ownership of
the lot to Morales. A successor-in-interest could only acquire rights that its
predecessor had over the lo which include the right to seek rescission or
fulfillment of the terms of the contract and the right to damages in either case.
III. SUBJECT M ATTER
GENERAL MARIANO ALVAREZ SERVICES COOPERATIVE, INC. (GEMASCO), vs.
NATIONAL HOUSING AUTHORITY (NHA) AND GENERAL MARIANO ALVAREZ WATER
DISTRICT (GMAWD), G.R. No. 175417/ GENERAL MARIANO ALVAREZ WATER
DISTRICT (GMAWD), Petitioner, v. AMINA CATANGAY, ELESITA MIRANDA, ROSITA
RICARTE, ROSA FETIZANAN, ABSALON AGA, ELPIDIO SARMIENTO, FRANCISCO
RICARDE, ROMEO CATACUTAN, RASALIO LORENZO, ARTEMIO RAFAEL, MYRN CEA,
AND NORMA ESTIL; NATIONAL HOUSING AUTHORITY (NHA) AND GENERAL
MARIANO ALVAREZ SERVICES COOPERATIVE, INC., REPRESENTED BY ERNESTO
FLORES, G.R. No. 198923, February 09, 2015, J. Peralta
Properties of public dominion, being for public use, are not subject to levy, encumbrance or
disposition through public or private sale. Any encumbrance, levy on execution or auction
sale of any property of public dominion is void for being contrary to public policy.
Otherwise, essential public services would stop if properties of public dominion would be
subject to encumbrances, foreclosures and auction sale. Since it is GEMASCO which is liable
9
for the payment of the separation pay and backwages to its illegally dismissed employees,
any contemplated sale must be confined only to those properties absolutely owned by it
and the subject water tanks lent to it by the NHA must corollarily be excluded from the
same.
A. SALE OF AN EXPECTED THING
ART 1461
HEIRS OF AMPARO DEL ROSARIO vs. SANTOS, G.R. NO. L-46892
September 30, 1981
By the terms of the Deed of Sale itself, appellants declared themselves to be
owners of one-half (1,2) interest thereof and contend that the deed of
assignment of one-half (1,2) interest thereof executed by said Custodio in their
favor is strictly personal between them. Notwithstanding the lack of any title to
the said lot by appellants at the time of the execution of the deed of sale in
favor of appellee, the said sale may be valid as there can be a sale of an
expected thing.
B. SALE OF A MERE HOPE OR EXPECTANCY
JAVIER vs. COURT OF APPEALS, G.R. NO. L -48194 M arch 15, 1990
The efficacy of a deed of assignment is subject to the condition that the
application of private respondent for an additional area for forest concession be
approved by the Bureau of Forestry which was not obtained. The efficacy of
the sale of a mere hope or expectancy is deemed subject to the condition that
the thing will come into existence, which did not happen, hence the agreement
executed never became effective or enforceable.
C. BOUNDARIES OF THE SUBJECT MATTER
DEL PRADO vs SPOUSES CABALLERO, G.R. NO. 148225, M arch 3,2010
The parties agreed on the purchase price of P40,000.00 for a predetermined
area of 4,000 sq m, more or less, but when the OCT was issued, the area was
declared to be 14,475 sq m, with an excess of 10,475 sq m. Petititiomer,
however, claims that respondents are, therefore, duty-bound to deliver the
whole area within the boundaries stated, without any corresponding increase
in the price. Article 1542 is not hard and fast and admits of an exception and
the use of more or less or similar words in designating quantity covers only a
reasonable excess or deficiency, and clearly, the discrepancy of 10,475 sq m
cannot be considered a slight difference in quantity.
SEM IRA vs. COURT OF APPEALS, G.R. NO. 76031 M arch 2, 1994
10
11
The seller gave access to the buyer to enter his premises, manifesting no
objection thereto but even sending people to start digging up the scrap iron.
The seller has placed the goods in the control and possession of the vendee and
such action or real delivery (traditio) transfered ownership.
ART 1497
MUNICIPALITY OF VICTORIAS vs. THE COURT OF APPEALS, G.R. NO. L 31189 M arch 31, 1987
Petitioner argues that the sales contract does not include the contract of
carriage which is a different contract entered into by the carrier with the cargo
owners.
As worded, the sales contract is comprehensive enough to include claims for
damages arising from carriage and delivery of the goods. As a general rule, the
seller has the obligation to transmit the goods to the buyer, and concomitant
thereto, the contracting of a carrier to deliver the same. Art. 1523 of the Civil
Code provides:
"Art. 1523. Where in pursuance of a contract of sale, the seller in authorized or
required to send the goods to the buyer, delivery of the goods to a carrier,
12
whether named by the buyer or not, for the purpose of transmission to the
buyer is deemed to be a delivery of the goods to the buyer, except in the cases
provided for in article 1503, first, second and third paragraphs, or unless a
contrary intent appear.
"Unless otherwise authorized by the buyer, the seller must take such contract
with the carrier on behalf of the buyer as may be reasonable, having regard to
the nature of the goods and the other circumstances of the case. If the seller
omit so to do, and the goods are lost or damaged in course of transit, the buyer
may decline to treat the delivery to the carrier as a delivery to himself,, or may
hold the seller responsible in damages."
xxx xxx xxx
The disputed sales contact provides for conditions relative to the delivery of
goods, such as date of shipment, demurrage, weight as determined by the bill
of lading at load port.
ART 1477
BOY vs. COURT OF APPEALS, G.R. NO. 125088, April 14, 2004
Petitioner sold the subject property to respondents as evidenced by a notarized
Deed of Absolute Sale, but contends that the respondents have no right to
material possession of the property since the respondents have not paid the
property in full. Unless there is a stipulation to the contrary, when the sale is
made through a public instrument, the execution thereof is equivalent to the
delivery of the thing which is the object of the contract.
V. PRICE
A. G.R.OSS INADEQUACY OF THE PRICE
ART 1470
SPOUSES BUENAVENTURA et al vs. COURT OF APPEALS, G.R. NO.
126376. November 20, 2003
Petitioners assert that their respondent siblings did not actually pay the prices
stated in the Deeds of Sale to their respondent father and assuming that there
is consideration, the same is grossly inadequate as to invalidate the Deeds of
Sale. If there is a meeting of the minds of the parties as to the price, the
contract of sale is valid and gross inadequacy of price does not affect a contract
of sale, except if there is a defect in the consent, or that the parties really
intended a donation or some other contract.
13
ART 1471
HO, JR. vs TENG GUI, G.R. NO. 130115, July 16, 2008
RTC considered that although the sales of the properties on the lot were
simulated, it can be assumed that the intention of Ho in such transaction was
to give and donate such properties to the respondent. The Court holds that the
reliance of the trial court on the provisions of Article 1471 of the Civil Code to
conclude that the simulated sales were a valid donation to the respondent is
misplaced because its finding was based on a mere assumption when the law
requires positive proof, which the respondent was unable to show.
As revealed by the records, it was only Hyatt who determined the price, without
the acceptance or conformity of CHBCAI. The fixing of the price can never be
left to the decision of one of the contracting parties, but a price fixed by one of
the contracting parties, if accepted by the other, gives rise to a perfected sale.
C. W HEN AND W HERE TO PAY THE PRICE
CHUA vs. COURT OF APPEALS, G.R. NO. 119255, April 9, 2003
On the agreed date, Chua refused to pay the balance of the purchase price as
required by the contract to sell, the signed Deeds of Sale, and imposes another
condition. The vendee is bound to accept delivery and to pay the price of the
thing sold at the time and place stipulated in the contract.
D. INTEREST
ART 1589
FULE vs. COURT OF APPEALS, G.R. NO. 112212, M arch 2, 1998
While it is true that the amount of P40,000.00 forming part of the
consideration was still payable to petitioner, its nonpayment by Dr. Cruz is not
a sufficient cause to invalidate the contract or bar the transfer of ownership
and possession of the things exchanged considering the fact that their contract
is silent as to when it becomes due and demandable.
Neither may such failure to pay the balance of the purchase price result in the
14
payment of interest thereon. Article 1589 of the Civil Code prescribes the
payment of interest by the vendee "for the period between the delivery of the
thing and the payment of the price" in the following cases:
(1) Should it have been so stipulated;
(2) Should the thing sold and delivered produce fruits or income;
(3) Should he be in default, from the time of judicial or extrajudicial demand for
the payment of the price.
E. SUSPENSION OF PAYMENT OF THE PRICE
ART 1590
CENTRAL BANK OF THE PHILIPPINES vs. SPOUSES ALFONSO, G.R. NO.
131074, M arch 27, 2000
Respondents aver that they are entitled to cancel the obligation altogether in
view of petitioner's failure to pay the purchase price when the same became
due, while Petitioner claims that the respondent failed to comply with their
contractual obligations hence it was entitled to withhold payment of the
purchase price. Should the vendee be disturbed in the possession or ownership
of the thing acquired, he may suspend the payment of the price until the
vendor has cause the disturbance or danger to cease. This is not, however, the
only justified cause for retention or withholding the payment of the agreed
price, but also, if the vendor fails to perform any essential obligation of the
contract.
ART 1592
SOLIVA vs. The INTESTATE ESTATE of M ARCELO M .VILLALBA, G.R. NO.
154017, December 8, 2003
While petitioner is now barred from recovering the subject property due to
laches, all is not lost for her since by respondent's own admission, a balance of
P1,250 of the total purchase price remains unpaid. In the sale of immovable
property, even though it may have been stipulated that upon failure to pay the
price at the time agreed upon the rescission of the contract shall take place,
the vendee may pay, even after the expiration of the period, as long as no
demand for rescission of the contract has been made upon him either judicially
or extrajudicially or by a notarial act.
VI. FORM ATION OF A CONTRACT OF SALE
A. STAGES TO THE CONTRACT OF SALE
15
SWEDISH M ATCH
October 20, 2004
vs.
COURT
OF
APPEALS,
G.R.
NO.
128120
Petitioners stress that respondent Litonjua made it clear in his letters that the
quoted prices were merely tentative and still subject to further negotiations
between him and the seller, hence, there was no meeting of the minds on the
essential terms and conditions of the sale because SMAB did not accept
respondents offer that consideration would be paid in Philippine pesos. In
general, contracts undergo three distinct stages, to wit: (1) Negotiation - begins
from the time the prospective contracting parties manifest their interest in the
contract and ends at the moment of agreement of the parties; (2) Perfection or
birth of the contract takes place when the parties aG.R.ee upon the essential
elements of the contract; and (3) Consummation occurs when the parties fulfill
or perform the terms agreed upon in the contract, culminating in the
extinguishment thereof.
B. ACCEPTED UNILATERAL PROMISE
ART 1479 (Read together with ART 1324)
TUAZON vs. DEL ROSARIO-SUAREZ, G.R. NO. 168325, December 8, 2010
The lessor made an offer to sell to the lessee the property at a fixed price within
a certain period, but the lessee failed to accept the offer or to purchase on time,
hence, the lessor sold the said property to her daughter. An accepted
unilateral promise can only have a binding effect if supported by a
consideration separate and distinct from the purchase price. Hence, the option
can still be withdrawn, even if accepted, if the same is not supported by any
consideration.
ANG YU vs. THE HON. COURT OF APPEALS, G.R. NO. 109125, December
2, 1994
Both the trial court and CA found that defendants' offer to sell was never
accepted by the plaintiffs for the reason that the parties did not agree upon the
terms and conditions of the proposed sale, hence, there was no contract of sale
at all.
When the sale is not absolute but conditional, such as in a "Contract to Sell"
where invariably the ownership of the thing sold is retained until the fulfillment
of a positive suspensive condition (normally, the full payment of the purchase
price), the breach of the condition will prevent the obligation to convey title
from acquiring an obligatory force.
16
The court found the contract to be valid, but nonetheless ruled that the option
to buy is unenforceable because it lacked a consideration distinct from the
price and RCBC did not exercise its option within reasonable time. Article
1324 of the Civil Code provides that when an offeror has allowed the offeree a
certain period to accept, the offer maybe withdrawn at anytime before
acceptance by communicating such withdrawal, except when the option is
founded upon consideration, as something paid or promised; on the other
hand, Article 1479 of the Code provides that an accepted unilateral promise to
buy and sell a determinate thing for a price certain is binding upon the
promisor if the promise is supported by a consideration distinct from the price.
C. EARNEST M ONEY
In a potential sale transaction, the prior payment of earnest money even before the
property owner can agree to sell his property is irregular, and cannot be used to bind the
owner to the obligations of a seller under an otherwise perfected contract of sale; to cite a
well-worn clich, the carriage cannot be placed before the horse. Securitron s sending of
the February 4, 2005 letter to FORC which contains earnest money constitutes a mere
reiteration of its original offer which was already rejected previously. FORC can never be
made to push through a sale which they never agreed to in the first place. FIRST OPTIMA
REALTY CORPORATION vs. SECURITRON SECURITY SERVICES, INC., G.R. No. 199648,
January 28, 2015, J. Del Castillo
ART 1482
SPOUSES SERRANO vs. CAGUIAT, G.R. NO. 139173, February 28, 2007
The lower court ruled that the receipt stating that the respondent made a
partial payment and that the execution and final deed of sale would be signed
upon payment of the balance, is a Contract of Sale and considered the partial
payment as earnest money, which prompted the respondent to demand specific
performance and damages when the herein petitioners cancelled the
transaction. Whenever earnest money is given in a contract of sale, it shall be
17
considered as part of the price and proof of the perfection of the contract, but
the earnest money given in a contract to sell will form part of the consideration
only if the sale is consummated upon full payment of the purchase price.
SAN M IGUEL PROPERTIES PHILIPPINES, INC., vs. SPOUSES HUANG, G.R.
NO. 137290. July 31, 2000
The appellate court held that all the requisites of a perfected contract of sale
had been complied with upon acceptance of the petitioner of the earnest money
tendered by respondents. It is not the giving of earnest money, but the proof of
the concurrence of all the essential elements of the contract of sale which
establishes the existence of a perfected sale.
VII. TRANSFER OF OWNERSHIP
NFF INDUSTRIAL CORPORATION VS. G & L ASSOCIATED BROKERAGEAND/OR
GERARDO TRINIDAD, G.R. No. 178169, January 12, 2015, J. Peralta
Under the Civil Code, the vendor is bound to transfer the ownership of and deliver, as well
as warrant the thing which is the object of the sale. The ownership of thing sold is
considered acquired by the vendee once it is delivered to him. Thus, ownership does not
pass by mere stipulation but only by delivery. In the Law on Sales, delivery may be either
actual or constructive, but both forms of delivery contemplate "THE ABSOLUTE GIVING UP
OF THE CONTROL AND CUSTODY OF THE PROPERTY ON THE PART OF THE VENDOR,
AND THE ASSUMPTION OF THE SAME BY THE VENDEE."
NFF INDUSTRIAL CORPORATION VS. G & L ASSOCIATES BROKERAGE AND/OR
GERARDO TRINIDAD, G.R. No. 178169. January 12, 2015, J. Peralta
The seller has actually delivered the bulk bags to buyer-company, although the same was
not delivered to the person named in the Purchase Order but to the representative of the
general manager of buyer-company. By allowing seller s employee to pass through the
guard-on-duty, who allowed the entry of delivery into the buyer s premises which is the
designated delivery site, the buyer had effectively abandoned whatever infirmities may
have attended the delivery of the bulk bags. Therefore, there was a valid delivery on the
part of the seller which transferred ownership to the buyer and which would then give rise
to an obligation to pay on the part of the buyer for the value of the bulk bags.
A. DEED OF SALE
ART 1498
DAILISAN vs. COURT OF APPEALS, G.R. NO. 176448, July 28, 2008
18
B. CONSTRUCTIVE DELIVERY
ART 1499
DY, JR. vs. COURT OF APPEALS, G.R. NO. 92989, July 8, 1991
20
21
Respondents caused the registration of the sale of the land in the Registry of
the Deeds. Petitioners, on the other hand, failed to cause the registration of the
sale to them. Where both parties claim to have purchased the same property,
the one who registered the sale in his favor, in good faith, has a preferred right
over the other who has not registered his title, even if the latter is in actual
possession of the immovable property.
SPOUSES AVELINO vs. SPOUSES CELEDONIO, G.R. NO. 135900, August
17, 2007
Article 1544 of the Civil Code contemplates a case of double sales or multiple
sales by a single vendor. It cannot be invoked where the two different contracts
of sale are made by two different persons, one of them not being the owner of
the property sold.
Spouses ABRIGO vs. DE VERA, G.R. NO. 154409, June 21, 2004
Both petitioners Abrigo and respondent registered the sale of the property, but
petitioners registered their sale under Act 3344, while respondent registered
the transaction under the Torrens system.
Between two buyers of the same immovable property, the law gives ownership
priority to (1) the first registrant in good faith; (2) then, the first possessor in
good faith; and (3) finally, the buyer who in good faith presents the oldest title.
Since the property in dispute in the present case was already registered under
the Torrens system, petitioners registration of the sale under Act 3344 was not
effective for purposes of Article 1544 of the Civil Code.
ISABELA COLLEGES, INC. vs. THE HEIRS OF NIEVES TOLENTINORIVERA, G.R. NO. 132677, October 20, 2000
Cortez filed a complaint-in-intervention claiming ownership over two parcels of
land by virtue of a sale in 1988, alleging that the lots were included in the fourhectare land covered by a Torrens Title of petitioner Isabela Colleges.
Even assuming that Cortez was not guilty of bad faith when he bought the land
in question, the fact remains that the Isabela Colleges was first in possession.
Petitioner has been in possession of the land since 1949. Between petitioner
and Cortez, therefore, the former had a better right for the latter only bought
the property in 1988 when it was already purchased by and titled under the
name of petitioner.
First buyer registered the sale under Act 3344, while second buyer registered
the sale under PD 1529. The governing principle is prius tempore, potior jure
(first in time, stronger in right). Knowledge by the first buyer of the second sale
cannot defeat the first buyers rights except when the second buyer first
registers in good faith the second sale, conversely, knowledge gained by the
second buyer of the first sale defeats his rights even if he is first to register,
since such knowledge taints his registration with bad faith.
BARICUATRO, JR.,
February 9, 2000
vs.
COURT
OF
APPEALS,
G.R.
NO.
105902
Amores was in good faith when he bought the disputed lots. When he
registered his title, however, he already had knowledge of the previous sale of
the disputed lots to petitioner. Such knowledge tainted his registration with
bad faith, and to merit protection under article 1544, the second buyer must
act in good faith from the time of the sale until the registration of the same
X. REM EDIES OF AN UNPAID SELLER
ART 1484 , 1485
PCI LEASING AND FINANCE, INC. vs. GIRAFFE-X CREATIVE IMAGING,
INC., G.R. NO. 142618, July 12, 2007
23
Petitioner contends that no rescission was effected simply by virtue of the letter
sent by respondent stating that he considered the contract of sale rescinded.
Petitioner asserts that a judicial or notarial act is necessary before one party
can unilaterally effect a rescission.
Respondent, on the other hand, contends that the right to rescind is vested by
law on the obligee and since petitioner did not oppose the inten t to rescind the
contract, petitioner in effect agreed to it and had the legal effect of a mutually
agreed rescission.
Article 1592 of the Civil Code is the applicable provision regarding the sale of
an immovable property.
Article 1592. In the sale of immovable property, even though it may have been
stipulated that upon failure to pay the price at the time agreed upon the
rescission of the contract shall of right take place, the vendee may pay, even
after the expiration of the period, as long as no demand for rescission of the
contract has been made upon him either judicially or by a notarial act. After the
demand, the court may not grant him a new term.
A judicial or notarial act is necessary before a valid rescission can take place,
whether or not automatic rescission has been stipulated. It is to be noted that
the law uses the phrase "even though" emphasizing that when no stipulation is
found on automatic rescission, the judicial or notarial requirement still applies.
25
Respondent alleges that it cannot be held liable for the 47,000 plastic bags
which were not used for packing cement as originally intended invoking it's
right of return. Article 1502 of the Civil Code, has no application at all to this
case, since the provision in the Uniform Sales Act and the Uniform Commercial
Code from which Article 1502 was taken, clearly requires an express written
agreement to make a sales contract either a "sale or return" or a "sale on
approval", which is absent in this case.
Parol or extrinsic testimony could not be admitted for the purpose of showing
that an invoice or bill of sale that was complete in every aspect and purporting
to embody a sale without condition or restriction constituted a contract of sale
or return. If the purchaser desired to incorporate a stipulation securing to him
the right of return, he should have done so at the time the contract was made.
On the other hand, the buyer cannot accept part and reject the rest of the
goods since this falls outside the normal intent of the parties in the "on
approval" situation.
B. IMPLIED WARRANTIES
ART 1628
LO vs. KJS ECO-FORMWORK SYSTEM PHIL., INC., G.R. NO. 149420
October 8, 2003
The vendor in good faith shall be responsible for the existence and legality of
the credit at the time of the sale, unless it should have been sold as doubtful;
but not for the solvency of the debtor, unless it has been so expressly
stipulated or unless the insolvency was prior to the sale and of common
knowledge.
ART 1546
ANG vs. COURT OF APPEALS, G.R. NO. 177874, September 29, 2008
The seller, in declaring that he owned and had clean title to the vehicle at the
time the Deed of Absolute Sale, is giving an implied warranty of title which
prescribes six months after the delivery of the vehicle.
ART 1547
PNB vs MEGA PRIME REALTY AND HOLDINGS CORPORATION, G.R. NO.
173454, October 6, 2008
MEGA PRIME REALTY AND HOLDINGS CORPORATION vs. PNB, G.R. NO.
173456, October 6, 2008
In a contract of sale, unless a contrary intention appears, there is an implied
warranty on the part of the seller that he has a right to sell the thing at the
26
time when the ownership is to pass, and that the buyer shall have a peaceful
possession of the thing and it shall be free from any hidden faults or defects, or
any charge or encumbrance not declared or known to the buyer.
ART 1548
ANG vs. COURT OF APPEALS, G.R. NO. 177874, September 29, 2008
The seller, in pledging that he will defend the same from all claims or any
claim whatsoe ver [and] will save the vendee from any suit by the government of
the Republic of the Philippines, is giving a warranty against e viction. A breach
of this warranty requires the concurrence of these four requisites:(1) The
purchaser has been deprived of the whole or part of the thing sold; (2) This
eviction is by a final judgment; (3) The basis thereof is by virtue of a right prior
to the sale made by the vendor; and (4) The vendor has been summoned and
made co-defendant in the suit for eviction at the instance of the vendee.
ART 1561
DE YSASI vs. ARCEO, G.R. NO. 136586, November 22, 2001
Petitioner admitted that he inspected the premises three or four times before
signing the lease contract and during his inspection, he noticed the rotten
plywood on the ceiling which in his opinion was caused by leaking water or
"anay" (termites), yet he decided to go through with the lease agreement. The
lessor is responsible for warranty against hidden defects, but he is not
answerable for patent defects or those which are visible.
C. REMEDIES AGAINST VIOLATIONS OF WARRANTIES
ART 1567
ENGINEERING & MACHINERY CORPORATION vs. COURT OF APPEALS,
G.R. NO. 52267, January 24, 1996
The original complaint is one for damages arising from breach of a written
contract - and not a suit to enforce warranties against hidden defects. The
remedy against violations of the warranty against hidden defects is either to
withdraw from the contract (redhibitory action) or to demand a proportionate
reduction of the price (accion quanti minoris), with damages in either case.
ART 1571
DINO vs COURT OF APPEALS, G.R. NO. 113564, June 20, 2001
27
28
The petitioner agreed to deliver the scrap iron only upon payment of the
purchase price by means of an irrevocable and unconditional letter of credit,
which the respondent failed to obtain, thus, there was no actual sale. Where
the goods have not been delivered to the buyer, and the buyer has repudiated
the contract of sale, or has manifested his inability to perform his obligations,
thereunder, or has committed a breach thereof, the seller may totally rescind
the contract of sale by giving notice of his election to do to the buyer.
XIV. EXTINGUSHMENT OF THE SALE
EAGLE RIDGE DEVELOPMENT CORPORATION, MARCELO N. NAVAL and CRISPIN I.
OBEN vs. CAMERON GRANVILLE 3 ASSET MANAGEMENT, INC., G.R. No. 204700,
November 24, 2014, J. Leonen
Cameron Grandville filed a motion for reconsideration for the April 10, 2013 decision of the
Supreme Court. It argues that the right of Eagle Ridge Development to extinguish the
obligation has already lapsed. However, the Court in resolving this case stated that under
the circumstances of this case, the 30-day period under Article 1634 within which Eagle
Ridge Developments could exercise their right to extinguish their debt should beg in to run
only from the time they were informed of the actual price paid by the assignee for the
transfer of their debt.
JUAN P. CABRERA VS. HENRY YSAAC, G.R. No. 166790. November 19, 2014, J. Leonen
Sale of a portion of the property is considered an alteration of the thing owned in common.
Such disposition requires the unanimous consent of the other co -owners. However, the
rules also allow a co-owner to alienate his or her part in the co-ownership.
If the alienation precedes the partition, the co-owner cannot sell a definite portion of the
land without consent from his or her co-owners. He or she could only sell the undivided
interest of the co-owned property.
The undivided interestof a co-owner is also referred to as the "ideal or abstract quota" or
"proportionate share." On the other hand, the definite portion of the land refers to specific
metes and bounds of a co-owned property.
Prior to partition, a sale of a definite portion of common property requires the consent of
all co-owners because it operates to partition the land with respect to the co-owner selling
his or her share. The co-owner or seller is already marking which portion should redound
to his or her autonomous ownership upon future partition.
In this case, the object of the sales contract between petitioner and respondent was a
definite portion of a co-owned parcel of land. At the time of the alleged sale between
petitioner and respondent, the entire property was still held in common.
29
While the rules allow respondent to sell his undivided interest in the coownership, this was
not the object of the sale between him and petitioner.
There was no showing that respondent was authorized by his co -owners to sell the portion
of land occupied by Juan Cabrera, the Espiritu family, or the Borbe family. Without the
consent of his co-owners, respondent could not sell a definite portion of the co -owned
property.
Thus, unless all the co-owners have agreed to partition their property, none of them may
sell a definite portion of the land. The co-owner may only sell his or her proportionate
interest in the co-ownership. A contract of sale which purports to sell a specific or definite
portion of unpartitioned land is null and void ab initio.
The absence of a contract of sale means that there is no source of obligations for
respondent, as seller, orpetitioner, as buyer. Rescission is impossible because there is no
contract to rescind. The rule in Article 1592 that requires a judicial or notarial act to
formalize rescission of a contract of sale of an immovable property does not apply.
ROBERTO R. DAVID vs. EDUARDO C. DAVID, G.R. No. 162365, JANUARY 15, 2014, J.
Bersamin
Eduardo and his brother Edwin sold their properties to Roberto with the agreement that
they would be given the right to repurchase within three years from the execution of the
deed of sale. Eduardo paid the repurchase price to Roberto by depositing the proceeds of
the sale of the Baguio City lot in the latter s account. The Supreme Court ruled such
payment was an effective exercise of the right to repurchase. In a sale with right to
repurchase, title and ownership of the property sold are immediately vested in the vendee,
subject to the resolutory condition of repurchase by the vendor within the stipulated
period. Accordingly, the ownership of the affected properties reverted to Eduardo once he
complied with the condition for the repurchase, thereby entitling him to the possession of
the other motor vehicle with trailer.
REDEMPTION
680 HOME APPLIANCES, INC. V THE HONORABLE COURT OF APPEALS, THE
HONORABLE MARYANNE. CORPUS-MAALAC, in her capacity as the PRESIDING
JUDGE OF THE REGIONAL TRIAL COURT OF MA.KATI CITY, BRANCH 141, ATTY.
ENGRACIO ESCASINAS, JR., in his capacity as THE EX-OFFICIO SHERIFF/CLERK OF
COURT VII, OFFICE OF THE CLERK OF COURT, REGIONAL TRIAL COURT, MA.KATI
CITY, FIRST SOVEREIGN ASSET MANAGEMENT (SPV-AMC), INC. and ALDANCO
MERLMAR, INC. G.R No. 206599, September 29, 2014. J. BRION
Upon the lapse of the redemption period without the debtor exercising his right of
redemption and the purchaser consolidates his title, it becomes unnecessary to require the
purchaser to assume actual possession thereof before the debtor may contest it. Possession
of the land becomes an absolute right of the purchaser, as this is merely an incident of his
30
ownership. In fact, the issuance of the writ of possession at this point becomes ministerial
for the court.
The debtor contesting the purchaser s possession may no longer avail of the remedy under
Section 8 of Act No. 3135, but should pursue a separate action e.g., action for recovery of
ownership, for annulment of mortgage and/or annulment of foreclosure. FSAMI s
consolidation of ownership therefore makes the remedy under Section 8 of Act No. 3135
unavailable for 680 Home.
FE H. OKABE v ERNESTO A. SATURNINO, G.R No. 196040, August 26, 2014. J. PERALTA
If the purchaser is a third party who acquired the property after the redemption period, a
hearing must be conducted to determine whether possession over the subject property is
still with the mortgagor or is already in the possession of a third party holding the same
adversely to the defaulting debtor or mortgagor. If the property is in the possession of the
mortgagor, a writ of possession could thus be issued. Otherwise, the remedy of a writ of
possession is no longer available to such purchaser, but he can wrest possession over the
property through an ordinary action of ejectment.
GE MONEY BANK, INC. (FORMERLY KEPPEL BANK PHILIPPINES) vs. SPOUSES
VICTORINO M. DIZON AND ROSALINA L. DIZON, G.R. No. 184301, March 23, 2015, J.
Peralta
An insufficient sum was tendered by the Spouses Dizon during the redemption period.
Whether the total redemption price is PhP 251,849.77 as stated in the Petition for Review,
or PhP
,
. as stated in the Bank s Motion for Reconsideration of the CA Decision, or
PhP
,
. as stated in its Appellant s Brief, is immaterial. What cannot be denied is
that the amount of PhP 90,000.00 paid by the Spouses Dizon during the redemption period
is less than half of PhP 181,956.72 paid by the Bank at the extrajudicial foreclosure sale... If
only to prove their willingness and ability to pay, the Spouses Dizon could have tendered a
redemption price that they believe as the correct amount or consigned the same. Seventeen
long years passed since the filing of the complaint but they did not do either. Indeed, they
manifestly failed to show good faith.
The Spouses Dizon s own evidence show that, after payment of PhP ,
. , the earliest
date they exerted a semblance of effort to re-acquire the subject property was on October
15, 1996. Apart from being way too late, the tender was not accompanied by the remaining
balance of the redemption price. The same is true with respect to their letter dated
February
,
, wherein they were still making proposals to the Bank. The court s
intervention was resorted to only on April 3, 1998 after the redemption period expired on
October 18, 1994, making it too obvious that such recourse was merely a delayed
afterthought to recover a right already lost.
A. SALE W ITH PACTO DE RETRO
ART 1601
31
NOOL vs. COURT OF APPEALS, G.R. NO. 116635, July 24, 1997
Petitioners contend that they could repurchase the property that they "sold" to
private respondents when they allowed the respondent to redeem the properties
for them from DBP. DBP, howe ver, certified that the petitioner-mortgagors'
right of redemption was not exercised within the period, hence DBP became the
absolute owner of said parcels of land when it entered into a Deed of
Conditional Sale involving the same parcels of land with Private Respondent as
vendee. One "repurchases" only what one has previously sold since the right to
repurchase presupposes a valid contract of sale between the same parties.
DIAM ANTE vs. HON. COURT OF APPEALS, G.R. NO. L -51824 February 7,
1992
vendors right to redeem and retention by the vendor of the possession of the
property is inconsistent with the vendees acquisition of the right of ownership
under a true sale.
ART 1606
ABILLA vs. ANG GOBONSENG, JR., G.R. NO. 146651, January 17, 2002
The legal question to be resolved is "May the vendors in a sale judicially
declared as a pacto de retro exercise the right of repurchase under Article
1606, third paragraph, of the Civil Code, after they have taken the position that
the same was an equitable mortgage?" No, where the proofs established that
there could be no honest doubt as to the parties intention, that the transaction
was clearly and definitely a sale with pacto de retro, the vendor a retro is not
entitled to the benefit of the third paragraph of Article 1606.
AGAN vs. HEIRS OF SPS. NUEVA, G.R. NO. 155018, December 11, 2003
The lower court's dispositive position states: "Howe ver, the vendors can still
exercise the right to repurchase said property within thirty (30) days from
receipt of this decision pursuant to Article 1606 and 1607 of the New Civil
Code." Article 1606 grants the vendor a retro thirty (30) days from the time
final judgment was rendered, not from the defendants receipt of the judgment,
"final judgment must be construed to mean one that has become final and
executory.
ART 1607
Spouses CRUZ vs. LEIS et al., G.R. NO. 125233, M arch 9, 2000
The lower court rationalized that petitioners failed to comply with the
provisions of Article 1607 of the Civil Code requiring a judicial order for the
consolidation of the ownership in the vendee a retro to be recorded in the
Registry of Property. A judicial order is necessary in order to determine the
true nature of the transaction and to prevent the interposition of buyers in
good faith while the determination is being made, however, notwithstanding
Article 1607, the recording in the Registry of Property of the consolidation of
ownership of the vendee is not a condition sine qua non to the transfer of
ownership for the method prescribed thereunder is merely for the purpose of
registering the consolidated title.
ART 1616
BPI FAM ILY SAVINGS BANK, INC. vs. SPS. VELOSO, G.R. NO. 141974,
August 9, 2004
33
The respondents offer to redeem the foreclosed properties and the subsequent
consignation in court were made within the period of redemption, but the
amount consigned did not include the interest and was also way below the
amount paid by the highest bidder-purchaser of the properties during the
auction sale. The redemption price should either be fully offered in legal tender
or else validly consigned in court because only by such means can the auction
winner be assured that the offer to redeem is being made in good faith.
ART 1619
LEE CHUY REALTY CORPORATION vs.HON. COURT OF APPEALS, G.R. NO.
104114 December 4, 1995
Petitioner questions the ruling of the Court of Appeals which concluded that a
prior tender or offer of redemption is a prerequisite or precondition to the filing
of the action for legal redemption. To avail of the right of redemption what is
essential is to make an offer to redeem within the prescribed period. There is
actually no prescribed form for an offer to redeem to be properly effected. It can
either be through a formal tender with consignation, or by filing a complaint in
court coupled with consignation of the redemption price within the prescribed
period.
ART 1622
G.R. NO. 134117. February 9, 2000
SEN PO EK MARKETING CORPORATION vs. MARTINEZ
Petitioner invokes its right of first refusal against private respondents, when
Teodora sold the property that petitioner has been leasing. Article 1622 of the
New Civil Code only deals with small urban lands that are bought for
speculation where only adjoining lot owners can exercise the right of pre emption or redemption. It does not apply to a lessee trying to buy the land that
it was leasing, especially when such right was never stipulated in any of the
several lease contracts.
ART 1623
JUAN P. CABRERA VS. HENRY YSAAC, G.R. No. 166790. November 19, 2014, J. Leonen
If the alienation precedes the partition, the co-owner cannot sell a definite portion of the
land without consent from his or her co-owners. He or she could only sell the undivided
interest of the co-owned property.
In the case at bar, no contract of sale exist. The object of a valid sales contract must be
owned by the seller. If the seller is not the owner, the seller must be authorized by the
owner to sell the object. There was no showing that respondent was authorized by his coowners to sell the portion of land occupied by Juan Cabrera, the Espiritu family, or the
Borbe family. Without the consent of his co-owners, respondent could not sell a definite
portion of the co-owned property.
SPOUSES MICHELLE M. NOYNAY and NOEL S. NOYNAY vs.CITIHOMES BUILDER AND
DEVELOPMENT, INC., G.R. No. 204160, September 22, 2014, J. Mendoza
Well-established is the rule that the assignee is deemed subrogated to the rights as well as
to the obligations of the seller/assignor. By virtue of the deed of assignment, the assignee is
deemed subrogated to the rights and obligations of the assignor and is bound by exactly the
same conditions as those which bound the assignor. What can be inferred from here is the
effect on the status of the assignor relative to the relations established by a contract which
has been subsequently assigned; that is, the assignor becomes a complete stranger to all
the mattersthat have been conferred to the assignee.
SPOUSES CHIN KONG WONG CHOI AND ANA O. CHUA vs. UNITED COCONUT PLANTERS
BANK, G.R. No. 207747, March 11, 2015, J. Carpio
UCPB assigned accounts receivable to Primetown. Thereafter, Spouses filed a complaint
against the latter for refund for payment. The court ruled that the agreement conveys the
straightforward intention of Primetown to sell, assign, transfer, convey and set over to
35
UCPB the receivables, rights, titles, interests and participation over the units covered by the
contracts to sell. It explicitly excluded any and all liabilities and obligations, which
Primetown assumed under the contracts to sell. In every case, the obligations between
assignor and assignee will depend upon the judicial relation which is the basis of the
assignment. An assignment will be construed in accordance with the rules of construction
governing contracts generally, the primary object being always to ascertain and carry out
the intention of the parties. This intention is to be derived from a consideration of the
whole instrument, all parts of which should be given effect, and is to be sought in the words
and language employed.
CABALES vs. COURT OF APPEALS, G.R. NO. 162421, August 31, 2007
Petitioners may redeem the subject property from respondents-spouses, but
they must do so within thirty days from notice in writing of the sale by their coowners vendors. In requiring written notice, Art. 1623 seeks to ensure that the
redemptioner is properly notified of (a) the sale and (b) the date of such notice,
as the date thereof becomes the reckoning point of the 30-day period of
redemption.
SPOUSES SI vs. COURT OF APPEALS, G.R. NO. 122047, October 12, 2000
Co-owners with actual notice of the sale are not entitled to written notice. A
written notice is a formal requisite to make certain that the co-owners have
actual notice of the sale to enable them to exercise their right of redemption
within the limited period of thirty days. But where the co-owners had actual
notice of the sale at the time thereof and/or afterwards, a written notice of a
fact already known to them, would be superfluous. The statute does not
demand what is unnecessary.
FRANCISCO vs. BOISER, G.R. NO. 137677, M ay 31, 2000
Art. 1623 of the Civil Code is clear in requiring that the written notification
should come from the vendor or prospective vendor, not from any other person.
Since the vendor of an undivided interest is in the best position to know who
are his co-owners who under the law must be notified of the sale, and is in the
best position to confirm whether consent to the essential obligation of se lling
the property and transferring ownership thereof to the vendee has been given.
LEDONIO vs. CAPITOL DEVELOPMENT CORPORATION, G.R. NO. 149040,
July 4, 2007
36
ART 1625
TEOCO, JR.,vs M ETROPOLITAN BANK AND TRUST COMPANY, G.R. NO.
162333, December 23, 2008
Would the exercise by the brothers Teoco of the right to redeem the properties
in question be precluded by the fact that the assignment of right of redemption
was not contained in a public document? NO, the phrase "effect as against
third person" in Article 1625 of the Civil Code is interpreted as to be damage or
prejudice to such third person, hence if the third person would not be
prejudiced then the assignment of right to redeem may not be in a public
instrument.
B. EQUITABLE MORTGAGE
SPOUSES FELIPE SOLITATIOS AND JULIA TORDA VS. SPOUSES GASTON JAQUE AND
LILIA JAQUE, G.R. No. 199852. November 12, 2014, J. Velasco
A transaction is deemed to be an equitable mortgage, not an absolute sale, when a party
have remained in possession of the subject property and exercised acts of ownership over
the lot even after the purported absolute sale and it could be gleaned from the intention of
the parties that the transaction is intended secure the payment of a debt.
SPOUSES FELIPE SOLITATIOS AND JULIA TORDA VS. SPOUSES GASTON JAQUE AND
LILIA JAQUE, G.R. No. 199852. November 12, 2014, J. Velasco
Where the alleged sellers have remained in possession of the subject property and
exercised acts of ownership over the lot even after its purported absolute sale, the real
intention of the parties was for the transaction to secure the payment of a debt or an
equitable mortgage and not a sale as provided under Article 1602 of the New Civil Code. If
the transaction had really been one of sale, as the alleged buyers claim, they should have
asserted their rights for the immediate delivery and possession of the lot instead of
allowing the alleged sellers to freely stay in the premises for almost seventeen (17) years
from the time of the purported sale until their filing of the complaint.
HEIRS OF REYNALDO DELA ROSA, Namely: TEOFISTA DELA ROSA, JOSEPHINE
SANTIAGO AND JOSEPH DELA ROSA v MARIO A. BA TONGBACAL, IRENEO
37
ART 1602
HEIRS OF JOSE REYES, JR. vs. REYES, G.R. NO.
2010
financial distress renders persons hard-pressed to meet even their basic needs
or to respond to an emergency, leaving no choice to them but to sign deeds of
absolute sale of property or deeds of sale with pacto de retro if only to obtain
the much-needed loan from unscrupulous money lenders. This reality precisely
explains why the pertinent provision of the Civil Code includes a peculiar rule
concerning the period of redemption, to wit:
Art. 1602. The contract shall be presumed to be an
equitable mortagage, in any of the following cases:
xxx
(3) When upon or after the expiration of the right to
repurchase another instrument extending the period of
redemption or granting a new period is executed;
VDA. DE DELFIN vs DELLOTA, G.R. NO. 143697, January 28, 2008
The essential requisites of an equitable mortgage are: (1) the parties enter into
what appears to be a contract of sale, (2) but their intention is to secure an
existing debt by way of mortgage and the presence of even one of the
circumstances enumerated in Article 1602.
SPS. SANTIAGO vs. DIZON, G.R. NO. 172771, January 31, 2008
Respondent alleged that the transaction was an equitable mortgage because
after the sale of the property respondent remained therein, and the price
according to respondent was grossly inadequate. The presumption of equitable
mortgage created in Article 1602 of the Civil Code is not conclusive and may be
rebutted by competent and satisfactory proof of the contrary.
CEBALLOS vs. Intestate Estate of the Late EM IGDIO M ERCADO, G.R. NO.
155856, M ay 28, 2004
Petitioner argues that Mercados delay in registering the Deed of Absolute Sale
and transferring the land title shows that the real agreement was an equitable
mortgage. Delay in transferring title is not one of the instances enumerated by
law in which an equitable mortgage can be presumed.
CEBALLOS vs. Intestate Estate of the Late EM IGDIO M ERCADO, G.R. NO.
155856, M ay 28, 2004
39
Petitioners contend that the sale was only an equitable mortgage because (1)
the price was grossly inadequate, and (2) the vendors remained in possession
of the land and enjoyed its fruits. For the presumption of an equitable
mortgage to arise, one must first satisfy the requirement that the parties
entered into a contract denominated as a contract of sale, and that their
intention was to secure an existing debt by way of mortgage.
BAUTISTA vs UNANGST, G.R. NO. 173002, July 4, 2008
The purchase price stated in the deed was the amount of the indebtedness of
the respondent to petitioner but the deed purports to be a sale with right to
purchase. The rule is firmly settled that whenever it is clearly shown that a
deed of sale with pacto de retro, regular on its face, is given as security for a
loan, it must be regarded as an equitable mortgage.
ART 1604
DEHEZA-INAMARGA vs ALANO, G.R. NO. 171321, December 18, 2008
The provisions of Article 1602 shall also apply to a contract purporting to be an
absolute sale, and in case of doubt, a contract purporting to be a sale with
right to repurchase shall be construed as an equitable mortgage in consonance
with the rule that the law favors the least transmission of property rights.
XV. The Subdivision and Condominium Buyers' Protective Decree (P.D.
957)
AMBROSIO ROTAIRO (SUBSTITUTED BY HIS SPOUSE MARIA RONSAYRO ROTAIRO,
AND HIS CHILDREN FELINA ROTAIRO, ERLINDA ROTAIRO CRUZ, EUDOSIA ROTAIRO
CRIZALDO, NIEVES ROTAIRO TUBIG, REMEDIOS ROTAIRO MACAHILIG, FELISA
ROTAIRO TORREVILLAS, AND CRISENCIO R. ROTAIRO, MARCIANA TIBAY, EUGENIO
PUNZALAN, AND VICENTE DEL ROSARIO vs. ROVIRA ALCANTARA AND VICTOR
ALCANTARA, G.R. No. 173632, September 29, 2014, J. Reyes
In this case, the contract to sell between Rotairo and Ignacio & Company was entered into
in
, and the agreement was fully consummated with Rotairo s completion of payments
and the execution of the Deed of Sale in his favor in 1979. Clearly, P.D. No. 957 (Sale of
Subdivision Lots and Condominiums) is applicable in this case.
)t was error for the CA to rule that the retroactive application of P.D. No.
is warranted
only where the subdivision is mortgaged after buyers have purchased individual lots.
According to the CA, the purpose of Sec. 18 requiring notice of the mortgage to the buyers
is to give the buyer the option to pay the installments directly to the mortgagee; hence, if
the subdivision is mortgaged before the lots are sold, then there are no buyers to notify.
40
What the CA overlooked is that Sec. 21 requires the owner or developer of the subdivision
project to complete compliance with its obligations within two years from 1976. The two year compliance provides the developer the opportunity to comply with its obligation to
notify the buyers of the existence of the mortgage, and consequently, for the latter to
exercise their option to pay the installments directly to the mortgagee.
FIL-ESTATE PROPERTIES, INC. AND FIL-ESTATE NETWORK, INC., vs. SPOUSES
CONRADO AND MARIA VICTORIA RONQUILLO, G.R. No. 185798, JANUARY 13, 2014, J.
Perez
The Spouses Rosario purchased a condominium unit from Fil-Estate. Fil-Estate failed to
comply with its obligations. The Supreme Court held that the Spouses are entitled to
rescission, pursuant to Section 23 of P.D. 957 which regulates the sale of subdivisions and
condominium lots. The Spouses Rosario may be reimbursed the total amount paid
including amortization interests but excluding delinquency interests, with interest thereon
at the legal rate.
PNB vs. OFFICE OF THE PRESIDENT, G.R. NO. 104528, January 18, 1996
A buyer of a property at a foreclosure sale cannot disposses prior purchasers
on installment of individual lots therein, or compel them to pay again for the
lots which they previously bought from the defaulting mortgagor-subdivision
developer on the theory that P.D. 957, "The Subdivision and Condominium
Buyers' Protective Decree", is not applicable to the mortgage contract in
question, the same having been executed prior to the enactment of P.D. 957.
Moreover, the SC held that, P.D. 957 being applicable, Section 18 of said law
obliges petitioner Bank to accept the payment of the remaining unpaid
41
registration of said notice of assessment except real property tax liens and
except that the declaration of restrictions may provide for the subordination
thereof to any other liens and encumbrances. Such liens may be enforced in
the same manner provided for by law for the judicial or extra-judicial
foreclosure of mortgage or real property. Unless otherwise provided for in the
declaration of restrictions, the management body shall have power to bid at
foreclosure sale. The condominium owner shall have the right of redemption as
in cases of judicial or extra-judicial foreclosure of mortgages.
Records do not show that petitioner had its notice of assessment registered
with the Registry of Deeds of Manila in order that the amount of such
assessment could be considered a lien upon Marual's two condominium units.
Clearly, pursuant to the above provisions, petitioner's claim can not be
considered superior to that of respondent. As mentioned earlier, the deed of
sale wherein Marual conveyed to respondent his two condominium units, was
registered in the Registry of Deeds of Manila.
CHATEAU DE BAIE CONDOMINIUM CORPORATION vs. SPOUSES MORENO,
G.R. NO. 186271, February 23, 2011
The petition sought to prohibit the scheduled extrajudicial sale for lack of a
special power to sell from the registered owner. Under RA 4726 (the
Condominium Act), when a unit owner fails to pay the association dues, the
condominium corporation can enforce a lien on the condominium unit by
selling the unit in an extrajudicial foreclosure sale, and a special authority
from the condominium owner before a condominium corporation can initiate a
foreclosure proceeding is not needed.
SUCCESSION
BERNARDINA P. BARTOLOME vs. SOCIAL SECURITY SYSTEM AND SCANMAR
MARITIME SERVICES, INC. G.R. No. 192531, November 12, 2014, J. Velaso, Jr.
At the time of the adoptive parent s death, which was prior to the effectivity of the Family
Code, the governing provision is Art. 984 of the New Civil Code, which provides that in case
of the death of an adopted child, leaving no children or descendants, his parents and
relatives by consanguinity and not by adoption, shall be his legal heirs. The adoptive
parent s death during the adopted child s minority resulted in the restoration of the
biological mother s parental authority over the adopted child. As a consequence thereof,
the biological mother shall be the adopted child s sole legal heir.
SPOUSES PERALTA v BERNARDINA ABALON, represented by MANSUETO ABALON.
G.R No. 183448, June 30, 2014. J. SERENO
43
Under Article 975 of the Civil Code, siblings Mansueto and Amelia Abalon, being niece and
nephew of a decedent who had no issue, are the legal heirs of Bernardina. As such, they
succeeded to her estate when she passed away. While the Court agreed with the CA that the
donation mortis causa in favor of the siblings was invalid in the absence of a will, the CA
erred in concluding that the heirs acquired the subject property through ordinary
acquisitive prescription. The subject parcel of land is a titled property; thus, acquisitive
prescription is not applicable. Upon the death of Bernardina, Mansueto and Amelia, being
her legal heirs, acquired the subject property by virtue of succession, and not by ordinary
acquisitive prescription.
NORA B. CALALANG-PARULAN and ELVIRA B. CALALANG vs. ROSARIO CALALANGGARCIA, LEONORA CALALANG-SABILE, and CARLITO S. CALALANG, G.R. No. 184148,
June 9, 2014, J. Villarama, Jr.
It is hornbook doctrine that successional rights are vested only at the time of death. Article
777 of the New Civil Code provides that "the rights to the succession are transmitted from
the moment of the death of the decedent. Thus, in this case, it is only upon the death of
Pedro Calalang on December 27, 1989 that his heirs acquired their respective inheritances,
entitling them to their pro indiviso shares to his whole estate. At the time of the sale of the
disputed property, the rights to the succession were not yet bestowed upon the heirs of
Pedro Calalang. And absent clear and convincing evidence that the sale was fraudulent or
not duly supported by valuable consideration (in effect an officious donation inter vivos),
the respondents have no right to question the sale of the disputed property on the ground
that their father deprived them of their respective shares. Well to remember, fraud must be
established by clear and convincing evidence .
NORA B. CALALANG-PARULAN and ELVIRA B. CALALANG v ROSARIO CALALANGGARCIA, LEONORA CALALANG-SABILE, and CARLITO S. CALALANG, G.R No. 184148,
June 9, 2014. VILLARAMA, JR.
It is hornbook doctrine that successional rights are vested only at the time of death. Article
777 of the New Civil Code provides that "the rights to the succession are transmitted from
the moment of the death of the decedent. Thus, it is only upon the death of Pedro Calalang
on December 27, 1989 that his heirs acquired their respective inheritances, entitling them
to their pro indiviso shares to his whole estate. At the time of the sale of the disputed
property, the rights to the succession were not yet bestowed upon the heirs of Pedro
Calalang. And absent clear and convincing evidence that the sale was fraudulent or not duly
supported by valuable consideration (in effect an in officious donation inter vivos), the
heirs have no right to question the sale of the disputed property on the ground that their
father deprived them of their respective shares.
MA. ELENA R. DIVINAGRACIA AS ADMINISTRATIX OF THE ESTATE OF THE LATE
SANTIAGO C. DIVINAGRACIA VS. CORONACION PARILLA ET AL. G.R. No. 196750.
March 11, 2015, J. Perlas-Bernabe
44
The heirs whether in their own capacity or in representation of their direct ascendant
have vested rights over the subject land and, as such, should be impleaded as indispensable
parties in an action for partition thereof. In fine, the absence of the indispensable parties in
the complaint for judicial partition renders all subsequent actions of the RTC null and void
for want of authority to act.
Vitug vs. Court of Appeals, G.R.NO. 82027, M ar. 29, 1990 183 SCRA 755
A will has been defined as "a personal, solemn, revocable and free act by which
a capacitated person disposes of his property and rights and declares or
complies with duties to take effect after his death."
Cayatenao vs Leonidas, 129 SCRA 524
The law which governs Adoracion Campos will is the law of Pennsylvania, USA
which is the national law of the decedent. It is settled that as regards to the
intrinsic validity of the provisions of the wills as provided for by article 16 and
1039 of the New Civil Code, the national law of the decedent must apply.
Subjects and Object of Succession
Parish Priest of Victoria vs. Rigor, 89 SCRA 483
45
The issue in this case is whether or not a male relative referred in the will
should include those who are born after the testators death. To construe it as
referring to the nearest male relative at any time after his death would render
the provisions difficult to apply and create uncertainty as to the disposition of
the estate.
Opening of Succession
De Borja vs De Borja, G.R. No, L-28040, August 18, 1972
There is no legal bar to a successor to dispose his or her share immediately
after such death, even if the actual extent of such share is not determined until
the subsequent liquidation of the estate. The effect of such alienation is to be
deemed limited to what is ultimately adjudicated to the vendor heir.
Testamentary Succession
Form and Solemnities of Notarial Wills
Baltazar v. Laxa, G.R.NO. 174489, April, 11, 2012
It is an established rule that "[a] testament may not be disallowed just because
the attesting witnesses declare against its due execution; neither does it have
to be necessarily allowed just because all the attesting witnesses declare in
favor of its legalization; what is decisive is that the court is convinced by
evidence before it, not necessarily from the attesting witnesses, although they
must testify, that the will was or was not duly executed in the manner required
by law."
46
47
48
The notary public before whom the will was acknowledged cannot be
considered as the third instrumental witness since he cannot acknowledge
before himself his having signed the will. This cannot be done because he
cannot split his personality into two so that one will appear before the other to
acknowledge his participation in the making of the will.
Caneda vs. CA, 222 SCRA 781
The rule on substantial compliance in Article 809 cannot be revoked or relied
on by respondents since it presupposes that the defects in the attestation
clause can be cured or supplied by the text of the will or a consideration of
matters apparent therefrom which would provide the data not expressed in the
attestation clause or from which it may necessarily be gleaned or clearly
inferred that the acts not stated in the omitted textual requirements were
actually complied within the execution of the will.
Lopez v. Lopez, 685 SCRA 209
The statement in the Acknowledgment portion of the subject last will and
testament that it "consists of 7 pages including the page on which the
ratification and acknowledgment are written" cannot be deemed substantial
compliance. The will actually consists of 8 pages including its acknowledgment
which discrepancy cannot be explained by mere examination of the will itself
but through the presentation of evidence aliunde.
Guerrero v. Bihis, 521 SCRA 394
The issue in this case whether the will acknowledged by the testatrix and the
instrumental witnesses before a notary public acting outside the place of his
commission satisfies the requirement under Article 806 of the Civil Code?
Outside the place of his commission, he is bereft of power to perform any
notarial act; he is not a notary public. Any notarial act outside the limits of his
jurisdiction has no force and effect.
Celada v. Abena, 556 SCRA 569
While it is true that the attestation clause is not a part of the will, error in the
number of pages of the will as stated in the attestation clause is not material to
invalidate the subject will. It must be noted that the subject instrument is
consecutively lettered with pages A, B, and C which is a sufficient safeguard
from the possibility of an omission of some of the pages.
Form and Solemnities of Holographic W ills
Rodelas vs. Aranza, 119 SCRA 16
The photostatic or xerox copy of a lost or destroyed holographic will may be
admitted because then the authenticity of the handwriting of the deceased can
be determined by the probate court.
49
Modes of Revocation
Casiano vs CA 158 SCRA 451
Revocation under this condition to be effective must have complied with the
two requirements: the overt act as mentioned under the law; the intent to
revoke on the part of the testator. The document or paper burned by one of the
witnesses was not satisfactorily established to be the will at all, much less the
will of Adriana.
will has been destroyed by any other person without the knowledge or
authority of the testator.
result in intestacy are the legacies and devises made in the will for they should
stand valid and respected, except insofar as the legitimes are concerned.
Nuguid vs. Nuguid, 17 SCRA 449
The will here does not explicitly disinherit the testatrix's parents, the forced
heirs. It simply omits their names altogether. Said will rather than be labeled
ineffective disinheritance is clearly one in which the said forced heirs suffer
from preterition.
Seangio v. Reyes G.R.NO. 140371-72, Nov. 27, 2006 508 SCRA 172
The mere mention of the name of one of the petitioners, Virginia, in the
document did not operate to institute her as the universal heir. Her name was
included plainly as a witness to the altercation between Segundo and his son,
Alfredo.
Substitution of Heirs
Palacios vs Ramirez, 111 SCRA 704
The word degree means generation and the present code has obviously
followed this interpretation by providing that the substitution shall not go
beyond one degree from the heir originally instituted. The code thus clearly
indicates that the second heir must be related to and one generation from the
first heir.
SPOUSES DOMINADOR MARCOS and GLORIA MARCOS, vs. HEIRS OF ISIDRO BANGI
and GENOVEVA DICCION, represented by NOLITO SABIANO, G.R. No. 185745, October
15, 2014, J. Reyes.
Partition is the separation, division and assignment of a thing held in common among those
to whom it may belong. Every act which is intended to put an end to indivision among co heirs and legatees or devisees is deemed to be a partition. Partition may b e inferred from
circumstances sufficiently strong to support the presumption. Thus, after a long
possession in severalty, a deed of partition may be presumed. The evidence presented by
the parties indubitably show that, after the death of Alipio, his heirs Eusebio, Espedita
and Jose Bangi had orally partitioned his estate, including the subject property, which
was assigned to Eusebio. Accordingly, considering that Eusebio already owned the subject
property at the time he sold the one-third portion thereof.
56
57
P ARTNERSHIP
I. Contract of Partnership
LIM TONG LIM vs. PHILIPPINE FISHING GEAR INDUSTRIES, INC., G.R. NO.
136448, November 3, 1999
A partnership may be deemed to exist among parties who agree to borrow
money to pursue a business and to divide the profits or losses that may arise
therefrom, even if it is shown that they have not contributed any capital of their
own to a "common fund." Their contribution may be in the form of credit or
industry, not necessarily cash or fixed assets.
58
ROSARIO U. YULO vs. YANG CHIAO SENG, G.R. NO. L-12541, August 28,
1959
The following are the requisites of partnership: (1) two or more persons who
bind themselves to contribute money, property, or industry to a common fund;
(2) intention on the part of the partners to divide the profits among themselves.
(Art. 1767, Civil Code.).
60
Tai Tong Chuache & Co. vs. Insurance Commission, G.R. NO. L-55397
February 29, 1988
Petitioner being a partnership may sue and be sued in its name or by its duly
authorized representative. Thus, Chua as the managing partner of the
partnership may execute all acts of administration including the right to sue
debtors of the partnership in case of their failure to pay their obligations when
it became due and demandable.
Catalan vs. Gatchalian, G.R. NO. L-11648, April 22, 1959
Catalan and Gatchalian as partners mortgaged two lots together with the
improvements thereon to secure a credit. Catalan redeemed the property and
he contends that title should be cancelled and a new one must be issued in his
name. Under Article 1807 of the NCC every partner becomes a trustee for his
co-partner with regard to any benefits or profits derived from his act as a
partner. Consequently, when Catalan redeemed the properties in question, he
became a trustee and held the same in trust for his co partner Gatchalian,
subject to his right to demand from the latter his contribution to the amount of
redemption.
61
Evangelista & Co. vs. Abad Santos, G.R. NO. L-31684 June 28, 1973
Respondent industrial partner has the right to demand for a formal accounting
and to receive her share in the net profit that may result from such an
accounting.
by the firm from part of its stock-in-trade, and the sale thereof is in pursuance
of partnership purposes, hence within the ordinary powers of the partner.
J. TIOSEJO INVESTMENT CORP. vs. Ang, G.R. NO. 174149, September 8,
2010
Petitioner cannot avoid liability by claiming that it was not in any way privy to
the Contracts to Sell executed by PPGI and respondents. As correctly argued
by the respondent, a joint venture is considered in this jurisdiction as a form of
partnership and is, accordingly, governed by the law of partnerships and under
Article 1824 of the Civil Code of the Philippines, all partners are solidarily liable
with the partnership for everything chargeable to the partnership, including
loss or injury caused to a third person or penalties incurred due to any
wrongful act or omission of any partner acting in the ordinary course of the
business of the partnership or with the authority of his co-partners.
V. Dissolution
PRIMELINK PROPERTIES AND DEVELOPMENT CORPORATION
LAZATIN-MAGAT, et.al, G.R. NO. 167379, June 27, 2006
vs.
after the partnership was organized is not tenable. The subsequent marriage of
the partners does not operate to dissolve it, such marriage not being one of the
causes provided for that purpose either by the Spanish Civil Code or the Code
of Commerce. The appellant's view, that by the marriage of both partners the
company became a single proprietorship, is equally erroneous. The capital
contributions of partners William J. Suter and Julia Spirig were separately
owned and contributed by them before their marriage; and after they were
joined in wedlock, such contributions remained their respective separate
property under the Spanish Civil Code.
AGENCY
ALVIN PATRIMONIO v NAPOLEON GUTIERREZ and OCTAVIO MARASIGAN III, G.R No.
187769, June 4, 2014. J. BRION
As a general rule, a contract of agency may be oral. However, it must be written when the
law requires a specific form, for example, in a sale of a piece of land or any interest therein
through an agent. Article 1878 paragraph 7 of the Civil Code expressly requires a special
power of authority before an agent can loan or borrow money in behalf of the principal, but
it does not state that the authority be in writing.
)n this case, Alvin Patrimonio s agent, Gutierrez, did not have any authority to borrow
money in Patrimonio s behalf. Patrimonio did not execute any SPA in favor of Gutierrez, nor
was Gutierrez given any authority, whether verbally or in writing, to borrow money in his
behalf, nor was he aware of any such transaction. Patrimonio s acts of pre-signing blank
checks and releasing them to Gutierrez does not establish that Patrimonio authorized
Gutierrez to fill them out and contract the loan in his behalf.
SPOUSES ROLANDO AND HERMINIA SALVADOR vs. SPOUSES ROGELIO AND
ELIZABETH RABAJA AND ROSARIO GONZALES, G.R. No. 199990, February 04, 2015, J.
Mendoza
Persons dealing with an agent must ascertain not only the fact of agency, but also the
nature and extent of the agent s authority. A third person with whom the agent wishes to
contract on behalf of the principal may require the presentation of the power of attorney,
or the instructions as regards the agency. According to Article 1990 of the New Civil Code,
insofar as third persons are concerned, an act is deemed to have been performed within the
scope of the agent's authority, if such act is within the terms of the power of attorney, as
written. In this case, Spouses Rabaja did not recklessly enter into a contract to sell with the
agent. They required her presentation of the power of attorney before they transacted with
her principal. And when the agent presented the SPA to Spouses Rabaja, the latter had no
reason not to rely on it.
I.Definition of Agency
64
Country Bankers Insurance Corp.. vs. Keppel Cebu Shipyard, June 18,
2012, G.R. NO. 166044
In a contract of agency, a person, the agent, binds himself to re present
another, the principal, with the latters consent or authority. Thus, agency is
based on representation, where the agent acts for and in behalf of the principal
on matters within the scope of the authority conferred upon him. Such acts
have the same legal effect as if they were personally done by the principal. By
this legal fiction of representation, the actual or legal absence of the principal is
converted into his legal or juridical presence.
Lintoja vs. Eternit Corp., G.R. NO. 144805, June 8, 2006
It bears stressing that in an agent-principal relationship, the personality of the
principal is extended through the facility of the agent. In so doing, the agent, by
legal fiction, becomes the principal, authorized to perform all acts which the
latter would have him do. Such a relationship can only be effected with the
consent of the principal, which must not, in any way, be compelled by law or
by any court.
Eurotech Industrial Technologies, Inc. Cuizon, G.R. NO. 167552, April 23,
2007
In a contract of agency, a person binds himself to render some service or to do
something in representation or on behalf of another with the latters consent.
The underlying principle of the contract of agency is to accomplish results by
using the services of others to do a great variety of things like selling, buying,
manufacturing, and transporting. Its purpose is to extend the personality of
the principal or the party for whom another acts and from whom he or she
derives the authority to act. It is said that the basis of agency is representation,
that is, the agent acts for and on behalf of the principal on matters within the
scope of his authority and said acts have the same legal effect as if they were
personally executed by the principal. By this legal fiction, the actual or real
absence of the principal is converted into his legal or juridical presence qui
facit per alium facit per se. The elements of the contract of agency are: (1)
consent, express or implied, of the parties to establish the relationship; (2) the
object is the execution of a juridical act in relation to a third person; (3) the
agent acts as a representative and not for himself; (4) the agent acts within the
scope of his authority.
II. Powers
65
67
MACARIA ARGUELLES AND THE HEIRS OF THE DECEASED PETRONIO ARGUELLES VS.
MALARAYAT RURAL BANK INC. G.R. No. 200468 March 19, 2014, J. Villarama Jr.
The issue in this case is case is whether Malarayat Rural Bank is a mortgagee in good faith
who is entitled to protection on its mortgage lien.
In this case, Malarayat Rural Bank fell short of the required degree of diligence, prudence,
and care in approving the loan application of the spouses Guia. Respondent should have
diligently conducted an investigation of the land offered as collateral. Although the Report
of Inspection and Credit Investigation found at the dorsal portion of the Application for
Agricultural Loan proved that the respondent Malarayat Rural Bank inspected the land, the
respondent turned a blind eye to the finding therein that the "lot is planted [with]
sugarcane with annual yield (crops) in the amount of P15,000. They merely derived the
authority to mortgage the lot from the Special Power of Attorney allegedly executed by the
late Fermina M. Guia. Hence, it was incumbent upon the respondent Malarayat Rural Bank
to be more cautious in dealing with the spouses Guia, and inquire further regarding the
identity and possible adverse claim of those in actual possession of the property. Since the
subject land was not mortgaged by the owner thereof and since the respondent Malarayat
Rural Bank is not a mortgagee in good faith, said bank is not entitled to protection under
the law. The unregistered sale in favor of the spouses Arguelles must prevail over the
mortgage lien of respondent Malarayat Rural Bank.
SPOUSES ROLANDO AND HERMINIA SALVADOR vs. SPOUSES ROGELIO AND
ELIZABETH RABAJA AND ROSARIO GONZALES, G.R. No. 199990, February 04, 2015, J.
Mendoza
According to Article 1990 of the New Civil Code, insofar as third persons are concerned, an
act is deemed to have been performed within the scope of the agent's authority, if such act
is within the terms of the power of attorney, as written. In this case, Spouses Rabaja did not
recklessly enter into a contract to sell with Gonzales. They required her presentation of the
power of attorney before they transacted with her principal. And when Gonzales presented
the SPA to Spouses Rabaja, the latter had no reason not to rely on it.
Orbeta vs. Sendiong, G.R. NO. 155236, July 8, 2005
A special power of attorney simply refers to a clear mandate specifically
authorizing the performance of a specific power and of express acts subsumed
therein, and there is a specific authority given to Mae Sendiong to sign her
name in behalf of Paul Sendiong in contracts and agreements and to institute
suits in behalf of her father. Neither would the fact that the document is
captioned General Power of Attorney militate against its construction as
granting specific powers to the agent pertaining to the petition for annulment of
judgment she instituted in behalf of her father. As Justice Paras has noted, a
68
general power of attorney may include a special power if such special power is
mentioned or referred to in the general power.
Country Bankers Insurance Corp. vs. Keppel Cebu Shipyard, June 18,
2012, G.R. NO. 166044
Our law mandates an agent to act within the scope of his authority. The scope
of an agents authority is what appears in the written terms of the power of
attorney granted upon him. Under Article 1878(11) of the Civil Code, a special
power of attorney is necessary to obligate the principal as a guarantor or
surety.
Mercado vs. Allied Banking Corpporation, G.R. NO. 171460, July 24, 2007
Equally relevant is the rule that a power of attorney must be strictly construed
and pursued. The instrument will be held to grant only those powers which
are specified therein, and the agent may neither go beyond nor deviate from the
power of attorney. Where powers and duties are specified and defined in an
instrument, all such powers and duties are limited and are confined to those
which are specified and defined, and all other powers and duties are excluded.
This is but in accord with the disinclination of courts to enlarge the authority
G.R.anted beyond the powers expressly given and those which incidentally flow
or derive therefrom as being usual and reasonably necessary and proper for the
performance of such express powers.
Angeles vs. Philippines National Railways, G.R. NO. 150128, August 31,
2006
A power of attorney is only but an instrument in writing by which a person, as
principal, appoints another as his agent and confers upon him the authority to
perform certain specified acts on behalf of the principal. The written
authorization itself is the power of attorney, and this is clearly indicated by the
fact that it has also been called a letter of attorney. Its primary purpose is not
to define the authority of the agent as between himself and his principal but to
evidence the authority of the agent to third parties with whom the agent deals.
Except as may be required by statute, a power of attorney is valid although no
notary public intervened in its execution.
SHOPPERS PARADISE REALTY & DEVELOPMENT CORPORATION vs.
EFREN P. ROQUE, G.R. NO. 148775, January 13, 2004
Article 1878 of the Civil Code expresses that a special power of attorney is
necessary to lease any real property to another person for more than one year.
The lease of real property for more than one year is considered not merely an
69
71
Petitioner did not sign the compromise agreement. The Supreme Court held that it is basic
in law that a compromise agreement, as a contract, is binding only upon the parties to the
compromise, and not upon non-parties. This is the doctrine of relativity of contracts. The
rule is based on Article
of the Civil Code which provides that contracts take effect
only between the parties, their assigns and heirs. The sound reason for the exclusion of
non-parties to an agreement is the absence of a vinculum or juridical tie which is the
efficient cause for the establishment of an obligation. Consistent with this principle, a
judgment based entirely on a compromise agreement is binding only on the parties to the
compromise the court approved, and not upon the parties who did not take part in the
compromise agreement and in the proceedings leading to its submission and approval by
the court.
I.Definition
Air Transportation Office v. Gopuco, Jr., G.R. NO. 158563. June 30, 2005
A compromise agreement, when not contrary to law, public order, public policy,
morals, or good customs, is a valid contract which is the law between the
parties. It is a contract perfected by mere consent, whereby the parties,
making reciprocal concessions, avoid litigation or put an end to one already
commenced. It has the force of law and is conclusive between the parties, and
courts will not relieve parties from obligations voluntarily assumed, simply
because their contracts turned out to be unwise
II.Void Compromise
SERCONSISION R. MENDOZA vs. AURORA MENDOZA FERMIN, G.R. No. 177235, July 7,
2014, J. Peralta
Fermin filed a case for Annulment of Deed of Absolute Sale, Transfer Certificate of Title and
Damages alleging that the signature of her father was forged. While the Court recognize
that the technical nature of the procedure in examining forged documents calls for
handwriting experts, resort to these experts is not mandatory or indispensable, because a
finding of forgery does not depend entirely on their testimonies. Judges must also exercise
independent judgment in determining the authenticity or genuineness of the signatures in
question, and not rely merely on the testimonies of handwriting experts.
Uy vs. Chua, G.R. NO. 183965, September 18, 2009
73
Like any other contract, a compromise agreement must comply with the
requisites in Article 1318 of the Civil Code, to wit: (a) consent of the
contracting parties; (b) object certain that is the subject matter of the contract;
and (c) cause of the obligation that is established. And, like any other contract,
the terms and conditions of a compromise agreement must not be contrary to
law, morals, good customs, public policy and public order. Any compromise
agreement that is contrary to law or public policy is null and void, and vests no
rights in and holds no obligation for any party. It produces no legal effect at
all.
Rivero vs. Court of Appeals, G.R. NO. 141273, M ay 17, 2005
Article 2035(1) of the New Civil Code provides that no compromise upon the
civil status of persons shall be valid. As such, paternity and filiation, or the
lack of the same, is a relationship that must be judicially established, and it is
for the court to determine its existence or absence. It cannot be left to the will
or agreement of the parties.
III.Effect
Philippine National Oil Company-Energy Development Corporation (PNOCEDC) v. Abella, G.R. NO. 153904, January 17, 2005
A compromise once approved by final orders of the court has the force of res
judicata between the parties and should not be disturbed except for vices of
consent or forgery. Hence, a decision on a compromise agreement is final and
executory. Such agreement has the force of law and is conclusive on the
parties. It transcends its identity as a mere contract binding only upon the
parties thereto, as it becomes a judgment that is subject to execution in
accordance with the Rules. Judges therefore have the ministerial and
mandatory duty to implement and enforce it. Hence, compromise agreements
duly approved by the courts are considered the decisions in the particular
cases they involve.
74
PNB, not having released the balance of the last loan proceeds in accordance with the 3rd
Amendment had no right to demand from [Spouses Tajonera s] compliance with their own
obligation under the loan. Indeed, if a party in a reciprocal contract like a loan does not
perform its obligation, the other party cannot be obliged to perform what is expected of
them while the other's obligation remains unfulfilled.
PHILIPPINE NATIONAL BANK vs. SPOUSES EDUARDO AND MA. ROSARIO TAJONERA
and EDUAROSA REALTY DEVELOPMENT, INC.G.R. No. 195889, September 24, 2014, J.
Mendoza
75
A loan requires the delivery of money or any other consumable object by one party to
another who acquires ownership thereof, on the condition that the same amount or quality
shall be paid. Loan is a reciprocal obligation, as it arises from the same cause where one
party is the creditor, and the other the debtor. The obligation of one party in a reciprocal
obligation is dependent upon the obligation of the other, and the performance should
ideally be simultaneous. This means that in a loan, the creditor should release the full loan
amount and the debtor repays it when it becomes due and demandable.
CHECKS
NEIL B. AGUILAR AND RUBEN CALIMBAS vs. LIGHTBRINGERS CREDIT
COOPERATIVE, G.R. No. 209605, January 12, 2015, J. Mendoza
The Court holds that there was indeed a contract of loan between the petitioners and
respondent. The signatures of the petitioners were present on both the PNB checks and the
cash disbursement vouchers. The checks were also made payable to the order of the
petitioners. The Court pointed out that a check functions more than a promissory note
since it not only contains an undertaking to pay an amount of money but is an "order
addressed to a bank and partakes of a representation that the drawer has funds on de posit
against which the check is drawn, sufficient to ensure payment upon its presentation to the
bank."
SAURA IMPORT and EXPORT CO., INC. vs. DEVELOPMENT BANK OF THE
PHILIPPINES, G.R. NO. L-24968, April 27, 1972
76
The trial court rendered judgment for the plaintiff, ruling that there was a
perfected contract between the parties when the application of Saura, Inc. for a
loan was approved by resolution of the defendant, and the corresponding
mortgage was executed and registered and that the defendant was guilty of
breach thereof.
An accepted promise to deliver something, by way of commodatum or simple
loan is binding upon the parties, but the commodatum or simple loan itself
shall not be perferted until the delivery of the object of the contract.
FRANCISCO HERRERA vs. PETROPHIL CORPORATION, G.R. NO. L -48349,
December 29, 1986
Pursuant to a contract, the defendant-appellee paid to the plaintfff-appellant
advance rentals for the first eight years, subtracting therefrom the amount of
the interest or discount for the first eight years, Plaintiff-appellant insists that
the lower court erred in the computation of the interest collected out of the
rentals paid for the first eight years; that such interest was excessive and
violative of the Usury Law.
The contract between the parties is one of lease and not of loan since the
provision for the payment of rentals in advance cannot be construed as a
repayment of a loan because there was no grant or forbearance of money as to
constitute an indebtedness on the part of the lessor, hence usury law will not
apply.
PNB vs. CA, G.R. NO. 75223, M arch 14, 1990
An escalation clause is a valid provision in the loan agreement provided that
(1) the increased rate imposed or charged does not exceed the ceiling fixed by
law or the Monetary Board; (2) the increase is made effective not earlier than
the effectivity of the law or regulation authorizing such an increase; and (3) the
remaining maturities of the loans are more than 730 days as of the effectivity of
the law or regulation authorizing such an increase.
ART 1249
SPOUSES TAGUMPAY N. ALBOS AND AIDA C. ALBOS vs. SPOUSES NESTOR M. EMBISAN
AND ILUMINADA A. EMBISAN, DEPUTY SHERIFF MARINO V. CACHERO, AND THE
REGISTER OF DEEDS OF QUEZON CITY, G.R. No. 210831, November 26, 2014, J.
Velasco Jr.
The compounding of interest should be in writing. Article 1956 of the New Civil Code,
which refers to monetary interest provides that No interest shall be due unless it has been
expressly stipulated in writing. As mandated by the foregoing provision, payment of
77
monetary interest shall be due only if: (1) there was an express stipulation for the payment
of interest; and (2) the agreement for such payment was reduced in writing.
The imposition of an unconscionable rate of interest on a money debt, even if knowingly
and voluntarily assumed, is immoral and unjust.
In the case at bar, it is undisputed that the parties have agreed for the loan to earn 5%
monthly interest, the stipulation to that effect put in writing. When the petitioners
defaulted, the period for payment was extended, carrying over the terms of the original
loan agreement, including the 5% simple interest. However, by the third extension of the
loan, respondent spouses decided to alter the agreement by changing the manner of
earning interest rate, compounding it beginning June 1986. This is apparent from the
Statement of Account prepared by the spouses Embisan themselves. Thus, Spouses
Embisan, having imposed, unilaterally at that, the compounded interest rate, had the
correlative duty of clarifying and reducing in writing how the said interest shall be earned.
Having failed to do so, the silence of the agreement on the manner of earning interest is a
valid argument for prohibiting them from charging interest at a compounded rate.
MCMP CONSTRUCTION CORP. VS. MONARK EQUIPMENT CORP. G.R. No. 201001.
November 10, 2014, J. Velaso Jr.
The interest rate of 24% per annum, penalty and collection charge of 3% or 36 % per
annum on rental fees provided by invoices for the lease of heavy equipment was found by
the court to be iniquitous, unconscionable and therefore void. Although C.B. Circular No.
905-82, which took effect on January 1, 1983, effectively removed the ceiling on interest
rates for both secured and unsecured loans, regardless o f maturity, nothing in the said
circular could possibly be read as granting carte blanche authority to lenders to raise
interest rates to levels which would either enslave their borrowers or lead to a
hemorrhaging of their assets. Therefore the rates may be validly reduced by the court.
SUN LIFE OF CANADA (PHILIPPINES), INC. vs. SANDRA TAN KIT and The Estate of the
Deceased NORBERTO TAN KIT, G.R. No. 183272, October 15, 2014, J. Del Castillo
Monetary interest refers to the compensation set by the parties for the use or forbearance
of money. No such interest shall be due unless it has been expressly stipulated in writing.
On the other hand, compensatory interest refers to the penalty or indemnity for damages
imposed by law or by the courts. This being the case and judging from the tenor of the CA,
there can be no other conclusion than that the interest imposed by the appellate -court is in
the nature of compensatory interest.
ROLANDO C. DE LA PAZ vs. L & J DEVELOPMENT COMPANY, G.R. No. 183360,
September 8, 2014, J. Del Castillo
78
When a person granted an unsecured loan without a maturity date in favor of a corporation
and its president and general manager (who is a lawyer) without reducing the loan
transaction in writing, the creditor cannot enforce payment of 6% monthly interest. The
payments of the debtor to the creditor must be considered as payment of the principal
amount of the loan because Article 1956 was not complied with. In addition, e ven if the
interest was in writing, it cannot be collected because it is unconscionable.
ANCHOR SAVINGS BANK vs. PINZMAN REALTY AND DEVELOPMENT CORPORATION,
MARYLIN MANALAC AND RENATO GONZALES, G.R. No. 192304, August 13, 2014, J.
Villarama Jr.
Foreclosure sale arising from a usurious mortgage cannot be given legal effect. This Court
has previously struck down a foreclosure sale where the amount declared as mortgage
indebtedness involved excessive, unreasonable, and unconscionable interest charges. In no
uncertain terms, this Court ruled that a mortgagor cannot be legally compelled to pay for a
grossly inflated loan. In the case at bar, the unlawful interest charge which led to the
amount demanded will result to the invalidity of the subsequent foreclosure sale.
ECE REALTY and DEVELOPMENT, INC. vs. HAYDYN HERNANDEZ, G.R. No. 212689,
August 6, 2014, J. Reyes
There is no doubt that ECE incurred in delay in delivering the subject condominium unit,
for which reason the trial court was justified in awarding interest to Hernandez from the
filing of his complaint. There being no stipulation as to interest, under Article 2209 the
imposable rate is six percent (6%) by way of damages. Section 1 of Resolution No. 796 of
the Monetary Board of the Bangko Sentral ng Pilipinas dated May 16, 2013 provides: "The
rate of interest for the loan or forbearance of any money, goods or credits and the rate
allowed in judgments, in the absence of an express contract as to such rate of interest, shall
be six percent (6%) per annum." Thus, the rate of interest to be imposed from finality of
judgments is now back at six percent (6%), the rate provided in Article 2209 of the Civil
Code.
CONRADO A. LIM vs. HMR PHILIPPINES, INC., TERESA SANTOS-CASTRO, HENRY
BUNAG AND NELSON CAMILLER, G.R. No. 201483, August 04, 2014, J. Mendoza
Lim argues that legal interest in accordance with the case of Eastern Shipping must also be
awarded. The rules on legal interest in Eastern Shipping have, however, been recently
modified by Nacar in accordance with Bangko Sentral ng Pilipinas Monetary Board (BSPMB) Circular No. 799, which became effective on July 1, 2013. Pertinently, it amended the
rate of legal interest in judgments from 12% to 6% per annum, with the qualification that
the new rate be applied prospectively. Thus, the 12% per annum legal interest in
79
judgments under Eastern Shipping shall apply only until June 30, 2013, and the new rate of
6% per annum shall be applied from July 1, 2013 onwards.
SPOUSES EDUARDO and LYDIA SILOS v PHILIPPINE NATIONAL BANK, G.R No. 181045,
July 2, 2014. J. DEL CASTILLO
Since the escalation clause was annulled for being violative of the mutuality principle, the
principal amount of the loan is subject to the original or stipulated rate of interest, and
upon maturity, the amount due shall be subject to legal interest at the rate of 12% per
annum.
ESTANISLAO AND AFRICA SINAMBAN VS. CHINA BANKING CORPORATION G.R. No.
193890. March 11, 2015, J. REYES
The subject three PNs bear interests ranging from 21% to 23% per annum, exclusive of
penalty of 1% on the overdue amount per month of delay, whereas in its complaint,
Chinabank prayed to recover only the legal rate of 12% on whatever judgment it could
obtain. Meanwhile, the Monetary Board of the Bangko Sentral ng Pilipinas in its Resolution
No. 796 dated May 16, 2013, and now embodied in Monetary Board Circular No. 799, has
effective July 1, 2013 reduced to 6%, from 12%, the legal rate of interest for the loan or
forbearance of any money, goods or credits and the rate allowed in judgments, in the
absence of stipulation. Since Chinabank demanded only the legal, not the stipulated,
interest rate on the deficiency and attorney s fees due, the defendants will solidarily pay
interest on their shares in the deficiency at the rate of 12% from November 18, 1998 to
June 30, 2013, and 6% from July 1, 2013 until fully paid.
ILEANA DR. MACALINAO vs BANK OF THE PHILIPPINE ISLANDS, G.R. NO.
175490, September 17, 2009
In its Complaint, respondent BPI originally imposed the interest and penalty
charges at the rate of 9.25% per month or 111% per annum which was
declared as unconscionable by the lower courts for being clearly excessive, and
was thus reduced to 2% per month or 24% per annum but which the CA
modified increased them to 3% per month or 36% per annum based on the
Terms and Conditions Governing the Issuance and Use of the BPI Credit Card,
which governs the transaction between petitioner Macalinao and respondent
BPI.
The courts may reduce the interest rate as reason and equity demand, for
stipulations demanding interest excessive, iniquitous, unconscionable and
exorbitant interest rates are void for being contrary to morals, if not against the
law.
COMMODATUM
80
CHURCH
vs.
CA,
G.R.
L-80294-95,
When respondents allowed the free use of the property they became bailors in
commodatum and the petitioner the bailee. The bailees' failure to return the
subject matter of commodatum to the bailor did not mean adverse possession
on the part of the borrower. The bailee held in trust the property subject matter
of commodatum. Hence, an adverse claim could not ripen into title by way of
ordinary acquisitive prescription because of the absence of just title.
REPUBLIC OF THE PHILIPPINES vs BAGTAS, G.R. NO. L-17474, October
25, 1962
The appellant had been in possession of the bull even after the expiration of the
contract. He contends, however, that since the contract was commodatum the
appellee retained ownership or title to the bull. Hence, it should suffer its loss
due to force majeure.
A contract of commodatum is essentially gratuitous. If the breeding fee be
considered a compensation, then the contract would be a lease of the bull.
Under article 1671 of the Civil Code the lessee would be subject to the
responsibilities of a possessor in bad faith, because she had continued
possession of the bull after the expiry of the contract. And even if the contract
be commodatum, still the appellant is liable, because article 1942 of the Civil
Code provides that a bailee in a contract of commodatum
. . . is liable for loss of the things, even if it should be through a fortuitous
event:
(2) If he keeps it longer than the period stipulated . . .
(3) If the thing loaned has been delivered with appraisal of its value, unless
there is a stipulation exempting the bailee from responsibility in case of a
fortuitous event; xxx
REPUBLIC OF THE PHILIPPINES vs. CA, G.R. NO. L -46145 November 26,
1986
The disputed property is private land and this possession was interrupted on ly
by the occupation of the land by the U.S. Navy which eventually abandoned the
premises. The heirs of the late Baloy, are now in actual possession, and this
has been so since the abandonment by the U.S. Navy.
81
The difference between a discount and a loan or forbearance is that the former
does not have to be repaid. The loan or forbearance is subject to repayment
and is therefore governed by the laws on usury.
82
Bank deposits are in the nature of irregular deposits; they are really loans
because they earn interest. The relationship then between a depositor and a
bank is one of creditor and debtor, and the deposit under the questioned
account was an ordinary bank deposit; hence, it was payable on demand of the
depositor.
SERRANO vs. CENTRAL BANK OF THE PHILIPPINES, G.R. NO. L -30511,
February 14, 1980
83
All kinds of bank deposits, whether fixed, savings, or current are to be treated
as loans and are to be covered by the law on loans because it can use the
same. Failure of he respondent Bank to honor the time deposit is failure to pay
s obligation as a debtor and not a breach of trust arising from depositary's
failure to return the subject matter of the deposit
The legal relationship between an arrastre operator and the consignee is akin
to that of a depositor and warehouseman. As a custodian of the goods
discharged from the vessel, it was defendant arrastre operator's duty, like that
of any ordinary depositary, to take good care of the goods and to turn them
over to the party entitled to their possession. Under this particular set of
circumstances, said defendant should have withheld delivery because of the
discrepancy between the bill of lading and the markings and conducted its own
investigation, not unlike that under Section 18 of the Warehouse Receipts Law,
or called upon the parties, to interplead, such as in a case under Section 17 of
the same law, in order to determine the rightful owner of the goods.
TRUST RECEIPT
VINTOLA vs. INSULAR BANK OF ASIA AND AMERICA, G.R. NO. 73271,
May 29, 1987
Mallari was administratively charged due to the fact the he approved surety bond in favor
of ECOBEL without consideration of the policies by GSIS. The court finds substantial
evidence to prove Mallari s administrative liability. The Court notes that irregularities,
defects and infirmities attended the processing, approval, issuance, and the actual
drawdown of the US$10,000,000.00 ECOBEL bond in which Mallari actively participated. In
a letter, dated September 13, 2002, to the FFIB, Mr. Reynaldo R. Nograles, OIC-Office of the
President, Internal Audit Service, GSIS, attached a copy of the excerpts from the Final
Report on the GSIS Audit of Underwriting Departments. Said Audit Report found that: there
was non-adherence to existing policies/SOPs in the processing and release of the Ecobel
Land, Inc. guaranty payment bond, as well as non-adherence to GS)S G)G s business policy
statement on survey, inspection or assessment of risks/properties to be insured including
re-inspection and survey of insured properties.
Verily, in a contract of suretyship, one lends his credit by joining in the principal debtor s
obligation so as to render himself directly and primarily responsible with him, and without
reference to the solvency of the principal. Thus, execution pending appeal against NSSC
means that the same course of action is warranted against its surety, CGAC. The same
reason stands for CGAC s other principal, Orimaco, who was determined to have
permanently left the country with his family to evade execution of any judgment against
him.
PEOPLE'S TRANS-EAST ASIA INSURANCE CORPORATION, a.k.a. PEOPLE'S GENERAL
INSURANCE CORPORATIONvs. DOCTORS OF NEW MILLENNIUM HOLDINGS, INC., G.R.
No. 172404, August 13, 2014, J. Leonen
The liabilities of an insurer under the surety bond are not extinguished when the
modifications in the principal contract do not substantially or materially alter the
principal's obligations. The surety is jointly and severally liable with its principal when the
latter defaults from its obligations under the principal contract. On the basis of petitioner s
own admissions, the principal contract of the suretyship is the signed agreement. The
surety, therefore, is presumed to have acquiesced to the terms and conditions embodied in
the principal contract when it issued its surety bond.
GILAT SATELLITE NETWORKS, LTD vs. UNITED COCONUT PLANTERS BANK GENERAL
INSURANCE CO., INC., G.R. No. 189563, April 7, 2014, CJ. Sereno
In suretyship, the oft-repeated rule is that a surety s liability is joint and solidary with that
of the principal debtor. This undertaking makes a surety agreement an ancillary contract,
85
86
Article 2079 of the Civil Code provides that "[a]n extension granted to the debtor by the
creditor without the consent of the guarantor extinguishes the guaranty," equally applies to
both contracts of guaranty and suretyship.
STRONGHOLD INSURANCE COMPANY, INC., vs. SPOUSES RUNE AND LEA
STROEM, G.R. No. 204689, January 21, 2015, J. Leonen
It is settled that a surety s solidary obligation for the performance of the principal debtor s
obligation is indirect and merely secondary. Nevertheless, the surety s liability to the
creditor or promisee of the principal is said to be direct, primary and absolute; in other
words, he is directly and equally bound with the principal. In enforcing a surety contract,
the complementary-contracts-construed-together doctrine finds application. According to
this principle, an accessory contract must be read in its entirety and together with the
principal agreement, as provided in Article 1374.
GUARANTY
HOME GUARANTY CORPORATION, vs. LA SAVOIE DEVELOPMENT CORPORATION, G.R.
No. 168616, January 28, 2015, J. Leonen
Home Guaranty Corporation is a guarantor of La Savoie. Subsequently, La Savoie was
placed under receivership. The Supreme Court held that placing La Savoie under
receivership brings into operation the rule against preference of creditors. Home Guaranty
Corporation must submit itself, like La Savoie's other creditors, to how La Savoie's Petition
for Rehabilitation shall be resolved. As a paying guarantor, Home Guaranty Corporation
was subrogated into the rights of La Savoie's creditors and now stands as the latter's own
creditor.
COMMONWEALTH INSURANCE CORPORATION vs. CA, G.R. NO. 130886.
January 29, 2004
Petitioners liability under the suretyship contract is different from its liability
under the law. There is no question that as a surety, petitioner should not be
made to pay more than its assumed obligation under the surety bonds.
However, it is clear from the above-cited jurisprudence that petitioners liability
for the payment of interest is not by reason of the suretyship agreement itself
but because of the delay in the payment of its obligation under the said
agreement.
THE IMPERIAL INSURANCE, INC. vs. DE LOS ANGELES, G.R. NO. L -28030,
January 18, 1982
Imperial Insurance, Inc. bound itself solidarily with the principal, the deceased
defendant Reyes. In accordance with Article 2059, par. 2 of the Civil Code of
the Philippines, excussion (previous exhaustion of the property of the debtor)
shall not take place "if he (the guarantor) has bound himself solidarily with the
debtor," hence the petitioner cannot escape liability on its counter-bonds.
MANILA SURETY & FIDELITY CO., INC. vs. ALMEDA, G.R. NO. L -27249
July 31, 1970
There is no question that under the bonds posted in favor of the NAMARCO in
this case, the surety company assumed to make immediate payment to said
firm of any due and unsettled accounts of the debtor-principal, even without
demand and notice of the debtor's non-payment, the surety, in fact, agreeing
that its liability to the creditor shall be direct, without benefit of exhaustion of
the debtor's properties, and to remain valid and continuous until the
guaranteed obligation is fully satisfied. In short, appellant secured to the
creditor not just the payment by the debtor-principal of his accounts, but the
payment itself of such accounts. Clearly, a contract of suretyship was thus
created, the appellant becoming the insurer, not merely of the debtor's solvency
or ability to pay, but of the debt itself. Under the Civil Code, with the debtor's
insolvency having been judicially recognized, herein appellant's resort to the
courts to be released from the undertaking thus assumed would have been
appropriate.
RCBC vs. ARRO, G.R. NO. L-49401, July 30, 1982
The surety agreement which was earlier signed by Enrique and private
respondent, is an accessory obligation, it being dependent upon a principal one
which, in this case is the loan obtained by Daicor as evidenced by a promissory
88
note. By the terms, it can be clearly seen that the surety agreement was
executed to guarantee future debts which Daicor may incur with petitioner
since a guaranty may also be given as security for future debts, the amount of
which is not yet known; there can be no claim against the guarantor until the
debt is liquidated.
REPUBLIC OF THE PHILIPPINES vs. PAL-FOX LUMBER CO., INC., G.R. NO.
L-26473, February 29, 1972
On whether the surety's liability can exceed the amount of its bond, it is
enough to remark that while the guarantee was for the original amount of the
debt of Gabino Marquez, the amount of the judgment by the trial court in no
way violates the rights of the surety. If it (the guaranty) be simple or indefinite,
it shall comprise not only the principal obligation but also all its accessories,
including judicial costs, provided with respect to the latter, that the guarantor
shall only be liable for those costs incurred after he has been judicially
required to pay.
IV. PLEDGE AND REAL MORTGAGE
ROLANDO ROBLES, REPRESENTED BY ATTY. CLARA C. ESPIRITU vs. FERNANDO FIDEL
YAPCINCO, PATROCINIO B. YAPCINCO, MARIA CORAZON B. YAPCINCO, and MARIA
ASUNCION B. YAPCINCO-FRONDA, G.R. No. 169569, October 22, 2014, J. Bersamin
The effect of the failure of Apolinario Cruz, the predecessor-in-interest of Rolando Robles,
petitioner to this case, to obtain the judicial confirmation was only to prevent the title to
the property from being transferred to him. For sure, such failure did not give rise to any
right in favor of the mortgagor or the respondents as his successors-in-interest to take back
the property already validly sold through public auction. Nor did such failure invalidate the
foreclosure proceedings. To maintain otherwise would render nugatory the judicial
foreclosure and foreclosure sale, thus unduly disturbing judicial stability.
RURAL BANK OF CABADBARAN, INC v JORGITA A. MELECIO-YAP, LILIA MELECIO
PACIFICO (deceased, substituted by her only child ERILL* ISAAC M. PACIFICO, JR.),
REYNALDO A. MELECIO DELOSO, and SARAH MELECIO PALMA-GIL, G.R No. 178451,
July 30, 2014. PERLAS-j. BERNABE
In this case, the bank claims that it should be deemed a mortgagee in good faith for having
conducted exhaustive investigations on the history of the mortgagor s title.
However, the Court found this argument untenable. first, the doctrine of mortgagee in good
faith applies only to lands registered under the Torrens system and not to unregistered
lands, as the properties in suit; and second, the principle is inapplicable to banking
89
institutions which are behooved to exercise greater care and prudence before entering into
a mortgage contract.
RURAL BANK OF CABADBARAN, INC. vs. JORGITA A. MELECIO-YAP, LILIA MELECIO
PACIFICO (deceased, substituted by her only child ERILL*ISAAC M. PACIFICO, JR.),
REYNALDO A. MELECIO DELOSO, and SARAH MELECIO PALMA-GIL, G.R. No. 178451,
July 30, 2014, J. Perlas-Bernabe
When a bank relied on a forged SPA, it has the burden to prove its authenticity and due
execution as when there is a defect in the notarization of a document, the clear and
convincing evidentiary standard normally attached to a duly-notarized document is
dispensed with, and the measure to test the validity of such document is preponderance of
evidence.
However, where a mortgage is not valid due to a forged SPA, the principal obligation which
it guarantees is not thereby rendered null and void. What is lost is merely the right to
foreclose the mortgage as a special remedy for satisfying or settling the indebtedness
which is the principal obligation. In case of nullity, the mortgage deed remains as evidence
or proof of a personal obligation of the debtor and the amount due to the creditor may be
enforced in an ordinary action.
The partial invalidity of the subject real estate mortgage brought about by the forged status
of the subject SPA would not, therefore, result into the partial invalidation of the loan
obligation principally entered into by the parties; thus, absent any cogent reason to hold
otherwise, the need for the recomputation of said loan obligation should be dispensed with.
LEONARDO C. CASTILLO, represented by LENNARD V. CASTILLO vs. SECURITY BANK
CORPORATION, JRC POULTRY FARMS or SPOUSES LEON C. CASTILLO, JR., and
TERESITA FLORESCASTILLO, G.R. No. 196118, July 30, 2014, J. Peralta
In a real estate mortgage, allegations of forgery, like all other allegations, must be proved
by clear, positive, and convincing evidence by the party alleging it. But even if there is
variation on the date of issuance of the Community Tax Certificate (CTC) as indicated on
the notarization of the alleged SPA and on the day it was actually secured, such defect in the
SPA does not automatically render it invalid. Defective notarization will simply strip the
document of its public character and reduce it to a private instrument, but nonetheless,
binding, provided its validity is established by preponderance of evidence.
The law requires that the form of a contract that transmits or extinguishes real rights over
immovable property should be in a public document, yet the failure to observe the proper
form does not render the transaction invalid. The necessity of a public document for said
contracts is only for convenience; it is not essential for validity or enforceability.
PHILIPPINE NATIONAL BANK vs. JOSE GARCIA and CHILDREN et al., G.R. No. 182839,
June 2, 2014, J. Brion
90
The Amendment of Real Estate Mortgage constituted by Jose Sr. over the entire property
without his co-owners' consent is not necessarily void in its entirety. The right of the PNB
as mortgagee is limited though only to the portion which may be allotted to Jose Sr. in the
event of a division and liquidation of the subject property. Registration of a property alone
in the name of one spouse does not destroy its conjugal nature. What is material is the time
when the property was acquired.
METROPOLITAN FABRICS INC. ET AL. VS. PROSPERITY CREDIT RESOURCES ENC. ET AL. G.R.
No. 154390 March 17, 2014, J. Bersamin
Contrary to their modified defense of absence of consent, the testimony adduced tended at
best to prove the vitiation of their consent through insidious words, machinations or
misrepresentations amounting to fraud, which showed that the contract of mortgage was
voidable. Where the consent was given through fraud, the contract was voidable, not void
ab initio. This is because a voidable or annullable contract is existent, valid and binding,
although it can be annulled due to want of capacity or because of the vitiated consent of
one of the parties.
ATTY. LEO N. CAUBANG vs. JESUS G. CRISOLOGO AND NANETTE B. CRISOLOGO, G.R.
No. 174581, February 04, 2015, J. Peralta
In an extrajudicial foreclosure of a real estate mortgage, failure to comply with the
publication requirement by the mortgagee brought by the failure of its lawyer to make an
effort to inquire as to whether the Oriental Daily Examiner was indeed a newspaper of
general circulation, as required by law, and as a result, the mortgagee became the sole
bidder, will invalidate the notice and render the sale voidable. The principal object of a
notice of sale in a foreclosure of mortgage is to notify the mortgagor and to inform the
public generally of the nature and condition of the property to be sold, and of the time,
place, and terms of the sale. These are given to secure bidders and prevent a sacrifice of
the property.
SPOUSES JOSE O. GATUSLAO AND ERMILA LEONILA LIMSIACO-GATUSLAO vs. LEO RAY
V. YANSON, G.R. No. 191540, January 21, 2015, J. Del Castillo
Yanson, as a transferee or successor-in-interest of PNB by virtue of the contract of sale
between them, is considered to have stepped into the shoes of PNB. As such, he is
necessarily entitled to avail of the provisions of Section 7 of Act No. 3135. Verily, one of the
rights that PNB acquired as purchaser of the subject properties at the public auction sale,
which it could validly convey by way of its subsequent sale of the same to respondent, is
the availment of a writ of possession. This can be deduced from the stipulation that the
vendee further agrees to undertake, at xxx his expense, the ejectment of any occupant of
the property. Accordingly, Yanson filed the contentious ex parte motion for a writ of
possession to eject Spouses Gatuslao therefrom and take possession of the subject
properties.
91
Further, respondent may rightfully take possession of the subject properties through a wr it
of possession, even if he was not the actual buyer thereof at the public auction sale, in
consonance with the Court s ruling in Ermitao v. Paglas. The Court ruled that after the
expiration of the redemption period without redemption having been made by petitioner,
respondent became the owner thereof and consolidation of title becomes a right. Being
already then the owner, respondent became entitled to possession. Petitioner already lost
his possessory right over the property after the expiration of the said period.
DEVELOPMENT BANK OF THE PHILIPPINES vs. GUARINA AGRICULTURAL AND
REALTY DEVELOPMENT CORPORATION, G.R. No. 160758, JANUARY 15, 2014, J.
Bersamin
Guarina executed a real estate mortgage over several real properties in favor of DBP as
security for a loan. However, before the loan was due, DBP foreclosed upon the mortgage.
The Supreme Court held that foreclosure of a mortgage prior to the mortgagor's default on
the principal obligation is premature, and should be undone for being void and ineffec tual.
The mortgagee who has been meanwhile given possession of the mortgaged property by
virtue of a writ of possession issued to it as the purchaser at the foreclosure sale may be
required to restore the possession of the property to the mortgagor and to pay reasonable
rent for the use of the property during the intervening period.
CENTRAL BANK OF THE PHILIPPINES vs. CA, G.R. NO. L -45710 October
3, 1985
The fact that when Sulpicio M. Tolentino executed a real estate mortgage, no
consideration was then in existence, as there was no debt yet because Island
Savings Bank had not made any release on the loan, does not make the real
estate mortgage void for lack of consideration. It is not necessary that any
consideration should pass at the time of the execution of the contract of real
mortgage, it may either be a prior or subsequent matter, but when the
consideration is subsequent to the mortgage, the mortgage can take effect only
when the debt secured by it is created as a binding contract to pay.
CENTRAL BANK OF THE PHILIPPINES vs. CA, G.R. NO. L-45710, October
3, 1985
Where the indebtedness actually owing to the holder of the mortgage is less
than the sum named in the mortgage, the mortgage cannot be enforced for
more than the actual sum due.
INTEG.R.ATED REALTY CORPORATION vs. PHILIPPINE NATIONAL BANK,
G.R. NO. L-60705, June 28, 1989
92
OVERSEAS BANK OF MANILA vs.CA, G.R. NO. L -60907 June 28, 1989
The facts and circumstances leading to the execution of the deed of
assignment, has satisfied the requirements of a contract of pledge (1) that it be
constituted to secure the fulfillment of a principal obligation; (2) that the
pledgor be the absolute owner of the thing pledged; (3) that the persons
constituting the pledge have the free disposal of their property, and in the
absence thereof, that they be legally authorized for the purpose. The further
requirement that the thing pledged be placed in the possession of the creditor,
or of a third person by common agreement was complied with by the execution
of the deed of assignment in favor of PNB.
YULIONGSIU vs. PNB, G.R. NO. L-19227, February 17, 1968
The defendant bank as pledgee was therefore entitled to the actual possession
of the vessels, and while it is true that plaintiff continued operating the vessels
after the pledge contract was entered into, his possession was expressly made
"subject to the order of the pledgee." On the other hand, there is an authority
supporting the proposition that the pledgee can temporarily entrust the
physical possession of the chattels pledged to the pledgor without invalidating
the pledge. In such a case, the pledgor is regarded as holding the pledged
property merely as trustee for the pledgee.
MAKATI LEASING and FINANCE CORPORATION vs. WEAREVER TEXTILE
MILLS, INC., G.R. NO. L-58469, M ay 16, 1983
A house of strong materials may be considered as personal property for
purposes of executing a chattel mortgage thereon as long as the parties to the
contract so agree and no innocent third party will be prejudiced there by. There
is absolutely no reason why a machinery, which is movable in its nature and
becomes immobilized only by destination or purpose, may not be likewise
treated as such. This is really because one who has so agreed is estopped from
denying the existence of the chattel mortgage.
BUNDALIAN vs. CA, G.R. NO. L-55739, June 22, 1984
The contract also provides that "it is agreed that the vendor shall have the right
to possess, use, and build on, the property during the period of redemption."
When the vendee acknowledged the right of the vendor to retain possession of
the property the contract is one of loan guaranteed by mortgage, not a
conditional sale or an option to repurchase.
93
94
CENTRAL BANK OF THE PHILIPPINES vs. CA, G.R. NO. L-45710, October
3, 1985
A pledge or mortgage is indivisible e ven though the debt may be divided among
the successors in interest of the debtor or creditor. Therefore, the debtor's heirs
who has paid a part of the debt can not ask for the proportionate
extinguishment of the pledge or mortgage as long as the debt is not completely
satisfied, neither can the creditor's heir who have received his share of the debt
return the pledge or cancel the mortgage, to the prejudice of other heirs who
have not been paid.
P ACTUM COM M ISSORIUM
PHILNICO INDUSTRIAL CORPORATION vs. PRIVATIZATION AND MANAGEMENT
OFFICE, G.R. No. 199420, August 27, 2014, J. Leonardo-De Castro
The SC disagreed with the findings of the CA that there is no pactum commissorium, on the
ground that since the ARDA and the Pledge Agreement are entirely separate and distinct
contract and that neither contract contains both elements of pactum commissoriu m: the
ARDA solely has the second element, while the Pledge Agreement only has the first
element, such provision cannot be considered as one of pactum commissorium.
Jurisprudence holds that the agreement of the parties may be embodied in only one
contract or in two or more separate writings. In case of the latter, the writings of the
parties should be read and interpreted together in such a way as to render their intention
effective.
In determining the existence of pactum commissorium, had focused more on the evident
intention of the parties, rather than the formal or written form.
Here, the ARDA and the Pledge Agreement herein, although executed in separate written
instruments, are integral to one another. It was the intention of the parties to enter into
and execute both contracts for a complete effectuation of their agreement.
EXTRA- JU DIC IAL FORECL OSURE
95
ATTY. LEO N. CAUBANG, vs. JESUS G. CRISOLOGO AND NANETTE B. CRISOLOGO, G.R.
No. 174581, February 04, 2015, J. Peralta
Petitioner failed to have the notice of sale published in a newspaper of general circulation.
The Supreme Court held that the principal object of a notice of sale in a foreclosure of
mortgage is to inform the public generally of the nature and condition of the property to be
96
sold, and of the time, place, and terms of the sale. Notices are given to secure bidders and
prevent a sacrifice of the property. Therefore, statutory provisions governing publication
of notice of mortgage foreclosure sales must be strictly complied with and slight deviations
therefrom will invalidate the notice and render the sale, at the very least, voidable.
L EASE
OWEN PROSPER A. MACKAY vs. SPOUSES DANA CASWELL AND CERELINA CASWELL,
G.R. No. 183872, November 17, 2014, J. Del Castillo
Under Article 1715 of the Civil Code, if the work of a contractor has defects which destroy
or lessen its value or fitness for its ordinary or stipulated use, he may be required to
remove the defect or execute another work. If he fails to do so, he shall be liable for the
expenses by the employer for the correction of the work. In the case at bar, Mackay was
given the opportunity to rectify his work. Subsequent to Zameco )) s disapproval to supply
the spouses Caswell electricity for several reasons, credence must be given to the latter s
claim that they looked for said Mackay to demand a rectification of the work, but said
Mackay and his group were nowhere to be found.
PRO-GUARD SECURITY SERVICES CORPORATION v TORMIL REALTY AND
DEVELOPMENT CORPORATION, G.R No. 176341, July 7, 2014. J. DEL CASTILLO
Tormil filed an unlawful detainer case against Torres-Pabalan. Meanwhile the building was
being leased to Pro-Guard. Tormil eventually prevailed in the ejectment case, and was
adjudged entitled to Pro-Guard s payment of rent. The issue in this case is when the rentals
should be reckoned.
Tormil, as the victor in the unlawful detainer suit, is entitled to the fair rental value for the
use and occupation of the unit in the building. Such compensation should not be reckoned
from the time Pro-Guard began to occupy the same, but from the time of the demand to
vacate. from the moment Pro-Guard started to occupy the unit in March 1994 up to
November 15, 1998, the right of Pro-Guard to possess the premises was not challenged. It
was only after Tormil prevailed over Manuel in its ownership of the same that it terminated
Pro-Guard s right to possess the unit it was occupying through a letter to vacate dated
November 16, 1998. Hence, it is only from that point that Tormil is considered to have
withdrawn its tolerance of Pro-Guard s occupation.
NEW WORLD DEVELOPERS AND MANAGEMENT INC. vs. AMA COMPUTER LEARNING
CENTER INC., G.R. Nos. 187930 & 188250, February 23, 2015, C.J. Sereno
New World and AMA entered into a lease agreement whereby New World agreed to lease
to AMA its commercial building located in Manila. AMA failed to pay its rentals citing
financial losses. AMA then preterminated the 8 year lease agreement and demanded the
97
refund of its security deposit and advance rentals. It also prayed that its liabilities be
reduced on account of its financial difficulties.
The Supreme Court ruled that in the sphere of personal and contractual relations governed
by laws, rules and regulations created to promote justice and fairness, equity is deserved,
not demanded. The application of equity necessitates a balancing of the equities involved in
a case, for [h]e who seeks equity must do equity, and he who comes into equity must come
with clean hands. Persons in dire straits are never justified in trampling on other persons
rights. Litigants shall be denied relief if their conduct has been inequitable, unfair and
dishonest as to the controversy in issue. The actions of AMA smack of bad faith.
MANUEL JUSAYAN,ALFREDO JUSAYAN, AND MICHAEL JUSAYANvs.JORGE SOMBILLA,
G.R. No. 163928, January 21, 2015, J. Bersamin
By virtue of Republic Act No. 3844, the sharing of the harvest in proportion to the
respective contributions of the landholder and tenant (share tenancy) was abolished.
Hence, to date, the only permissible system of agricultural tenancy is leasehold tenan cy, a
relationship wherein a fixed consideration is paid instead of proportionately sharing the
harvest as in share tenancy. Its elements are: (1) the object of the contract or the
relationship is an agricultural land that is leased or rented for the purpo se of agricultural
production; (2) the size of the landholding is such that it is susceptible of personal
cultivation by a single person with the assistance of the members of his immediate farm
household; (3) the tenant-lessee must actually and personally till, cultivate or operate the
land, solely or with the aid of labor from his immediate farm household; and (4) the
landlord-lessor, who is either the lawful owner or the legal possessor of the land, leases the
same to the tenant-lessee for a price certain or ascertainable either in an amount of money
or produce. In the case at bar, there is no doubt that a land with a total area of 7.9 hectares
were susceptible of cultivation by a single person with the help of the members of his
immediate farm household. Also, one s knowledge of and familiarity with the landholding,
its production and the instances when the landholding was struck by drought definitely
established that the lessee personally cultivated the land. Moreover, the fact that an
agricultural lessee has a regular employment does not render his ability to farm physically
impossible.
Pagurayan vs. Reyes, G.R. NO. 154577, July 23, 2008
A contract of lease is a consensual, bilateral, onerous and commutative
contract by which the owner temporarily grants the use of his property to
another who undertakes to pay the rent. Being a consensual contract, it is
perfected at the moment there is a meeting of the minds on the thing and the
cause and consideration which are to constitute the contract. Without the
agreement of both parties, no contract of lease can be said to have been created
or established. Nobody can force an owner to lease out his property if he is not
willing.
98
I. Lease of Things
obligated to pay for that liability. The entitlement to a refund or credit of excess input tax is
solely based on the distinctive nature of the VAT system. At the time of payment of the
input VAT, the amount paid was correct and proper.
L AND TITL ES AN D DEEDS
Torrens System
MARIFLOR T. HORTIZUELA, represented by JOVIER TAGAUFA vs. GREGORIA TAGUFA,
ROBERTO TAGUFA and ROGELIO LUMABAN, G.R. No. 205867, February 23, 2015, J.
Mendoza
Petitioner assails the decision of the CA that the action for reconveyance filed by her was
not the proper remedy on the ground that it constitutes a collateral attack on the validity of
the subject certificate of title. The SC however ruled that it is not unmindful of the principle
of indefeasibility of a Torrens title and that a certificate of title shall not be subject to
collateral attack. Contrary to the pronouncements of the MCTC and the CA, however, the
complaint of petitioner was not a collateral attack on the title warranting dismissal. As a
matter of fact, an action for reconveyance is a recognized remedy, an action in personam,
available to a person whose property has been wrongfully registered under the Torrens
system in another s name. )n an action for reconveyance, the decree is not sought to be set
aside. It does not seek to set aside the decree but, respecting it as incontrovertible and no
longer open to review, seeks to transfer or reconvey the land from the registered owner to
the rightful owner.
IMELDA, LEONARDO, FIDELINO, AZUCENA, JOSEFINA, ANITA AND SISA, ALL
SURNAMED SYJUCO VS FELISA D. BONIFACIO AND VSD REALTY & DEVELOPMENT
CORPORATION, .R. No. 148748. January 14, 2015, J. Leonardo-De Castro
Moreover, the rule on the incontrovertibility or indefeasibility of title has no application in
this case given the fact that the contending parties claim ownership over the subject land
based on their respective certificates of title thereon which originated from different
sources. Certainly, there cannot be two or even several certificates of title on the same
parcel of real property because "a land registration court has no jurisdiction to order the
registration of land already decreed in the name of another in an earlier land registration
case" and "a second decree for the same land would be null and void, since the principle
behind original registration is to register a parcel of land only once." The indefeasibility of a
title under the Torrens system could be claimed only if a previous valid title to the same
parcel of land does not exist. Where the issuance of the title was attended by fraud, the
same cannot vest in the titled owner any valid legal title to the land covered by it; and the
person in whose name the title was issued cannot transmit the same, for he has no true title
thereto. This ruling is a mere affirmation of the recognized principle that a certificate is not
conclusive evidence of title if it is shown that the same land had already been registered
and that an earlier certificate for the same land is in existence. ."
100
IMELDA SYJUCO, et.al vs. FELISA D. BONIFACIO and VSD REALTY & CORPORATION,
G.R. No. 148748, January 14, 2015, J. Leonardo-De Castro
The filing of an action to quiet title is imprescriptible if the disputed real property is in the
possession of the plaintiff. The rule on the incontrovertibility or indefeasibility of title has
no application in this case given the fact that the contending parties claim ownership over
the subject land based on their respective certificates of title thereon which originated
from different sources. The Syjucos' title, shows that it originated from OCT No. 994
registered on May 3, 1917 while Bonficacio's title shows that that it likewise originated
from OCT No. 994, but registered on April 19, 1917. This case affirmed the earlier finding
that there is only one OCT No.
, the registration date of which had already been
decisively settled as May
and not
April
and categorically concluded that
OCT No.
which reflects the date of
April
as its registration date is null and
void.
UNGAY MALOBAGO MINES, INC. vs. REPUBLIC OF THE PHILIPPINES, G.R. No. 187892,
January 14, 2015, J. Peralta
The persons who can file the petition for reconstitution of a lost certificate are the
registered owner, his assigns or persons in interest in the property. In this case, Ungay
Malobago Mines, Inc. admitted that it was not the owner of the land on which the mining
patent was issued as the same was owned and registered in the name of Rapu Rapu
Minerals Inc., thus it has no legal capacity to institute a petition for reconstitution of a lost
certificate.
REPUBLIC OF THE PHILIPPINES vs. HEIRS OF SPOUSES DONATO SANCHEZ and JUANA
MENESES represented by RODOLFO S. AGUINALDO, G.R. No. 212388, December 10,
2014, J. Velasco, Jr.
Before a certificate of title which has been lost or destroyed may be reconstituted, it must
first be proved by the claimants that said certificate of title was still in force at the time it
was lost or destroyed, among others.
SPOUSES CARLOS J. SUNTAY and ROSARIO R. SUNTAY vs. KEYSER MERCANTILE INC.,
G.R. No. 208462, December 10, 2014, J. Mendoza
Every person dealing with a registered land may safely rely on the correctness of the
certificate of title issued therefor and the law will in no way oblige him to go beyond the
certificate to determine the condition of the property.
FLORENTINO W. LEONG AND ELENA LEONG, ET AL. vs. EDNA C. SEE, G.R. No. 194077,
December 03, 2014, J. Leonen
Spouses owned the subject property wherein petitioner Elena was allowed to stay. Upon
the spouses divorce, the property went to the wife. She sold it to the respondent See. The
101
Court held that See was a buyer in good faith. She went to the Register of Deeds to verify
the title and relied on the marriage settlement agreement. The Court found that she exerted
due diligence. An innocent purchaser for value refers to someone who buys the property of
another without notice that some other person has a right to or interest in it, and who pays
a full and fair price at the time of the purchase or before receiving any notice of another
person s claim.
102
ELIZA ZUNIGA-SANTOS, represented by her Attorney-in Fact, NYMPHA Z. SALES vs. MARIA
DIVINA GRACIA SANTOS-GRAN and REGISTER OF DEEDS OF MARIKINA CITY, G.R. No. 197380,
October 8, 2014, J. Perlas-Bernabe
To determine when the prescriptive period commenced in an action for reconveyance, the
plaintiff s possession of the disputed property is material. If there is an actual need to
reconvey the property as when the plaintiff is not in possession, the action for
reconveyance based on implied trust prescribes in ten (10) years, the reference point being
the date of registration of the deed or the issuance of the title. On the other hand, if the real
owner of the property remains in possession of the property, the prescriptive period to
recover title and possession of the property does not run against him and in such case, the
action for reconveyance would be in the nature of a suit for quieting of title which is
imprescriptible.
In the case at bar, a reading of the allegations of the Amended Complaint failed to show that
Eliza remained in possession of the subject properties in dispute.
SPOUSES MARIO OCAMPO and CARMELITA F. OCAMPO vs. HEIRS OF BERNARDINO U.
DIONISIO, represented by ARTEMIO SJ. DIONISIO, G.R. No. 191101, October 1, 2014, J.
Reyes
Jurisprudence consistently holds that "prescription and laches cannot apply to registered
land covered by the Torrens system" because "under the Property Registration Decree, no
title to registered land in derogation to that of the registered owner shall be acquired by
prescription or adverse possession.
Mario claimed that they have been in possession of the said parcel of land since 1969 and
that cause of action of the Dionisios is already barred by laches. Jurisprudence consistently
holds that "prescription and laches cannot apply to registered land covered by the Torrens
system" because "under the Property Registration Decree, no title to registered land in
derogation to that of the registered owner shall be acquired by prescription or adverse
possession.
knew that there were structures built on the property. Rovira, however, claims that she
did not bother to inquire as to the legitimacy of the rights of the occupants, because she
was assured by the bank of its title to the property. But Rovira cannot rely solely on the
title and assurances of Pilipinas Bank; it was incumbent upon her to look beyond the title
and make necessary inquiries because the bank was not in possession of the property.
Where the vendor is not in possession of the property, the prospective vendees are
obligated to investigate the rights of one in possession. A purchaser cannot simply close
his eyes to facts which should put a reasonable man on guard, and thereafter claim that he
acted in good faith under the belief that there was no defect in the title of the vendor.
Hence, Rovira cannot claim a right better than that of Rotairo's as she is not a buyer in good
faith.
ENRIQUETA M. LOCSIN vs. BERNARDO HIZON, CARLOS HIZON, SPS. JOSE MANUEL
AND LOURDES GUEVARA, G.R. No. 204369, September 17, 2014, J. Velasco Jr.
A purchaser of property under the Torrens system cannot simply invoke that he is an
innocent purchaser for value when there are attending circumstances that raise suspicions.
In that case, he cannot merely rely on the title and must look beyond to ascertain the truth
as to the right of the seller to convey the property.
HEIRS OF SPOUSES JOAQUIN MANGUARDIA AND SUSANA MANALO, ET AL vs.
HEIRS OF SIMPLICIO VALLES AND MARTA VALLES, ET AL., G.R. No. 177616,
August 27, 2014, J. Del Castillo
The petitioners assail the decision of the CA affirming in toto the decision of the RTC
declaring that their predecessors-in-interest are not buyers in good faith and for value. In
denying the petition the SC ruled that the transfers of the properties in question did not go
far, but were limited to close family relatives by affinity and consanguinity. Good faith
among the parties to the series of conveyances is therefore hard if not impossible to
presume. Unfortunately for the petitioners, they did not provide any sufficient evidence
that would convince the courts that the proximity of relationships between/among the
vendors and vendees in the questioned sales was not used to perpetrate fraud. Thus there
is nothing to dispel the notion that apparent anomalies attended the transactions among
close relations.
It must be emphasized that "the burden of proving the status of a purchaser in good faith
and for value lies upon him who asserts that standing. In discharging the burden, it is not
enough to invoke the ordinary presumption of good faith that everyone is presumed to act
in good faith. The good faith that is here essential is integral with the very status that must
be proved. x x x Petitioners have failed to discharge that burden."
104
HECTOR L. UY vs. VIRGINIA G. FULE; HEIRS OF THE LATE AMADO A. GARCIA, HEIRS OF
THE LATE GLORIA GARCIA ENCARNACION; HEIRS OF THE LATE PABLO GARCIA; and
HEIRS OF THE LATE ELISA G. HEMEDES,G.R. No. 164961, June 30, 2014, J. Bersamin
The standard is that for one to be a purchaser in good faith in the eyes of the law, he should
buy the property of another without notice that some other person has a right to, or
interest in, such property, and should pay a full and fair price for the same at the time of
such purchase, or before he has notice of the claim or interest of some other persons in the
property. He buys the property with the belief that the person from whom he receives the
property was the owner and could convey title to the property. Indeed, a purchaser cannot
close his eyes to facts that should put a reasonable man on his guard and still claim he acted
in good faith.
SPOUSES DOMINADOR PERALTA AND OFELIA PERALTA vs. HEIRS OF BERNARDINA
ABALON / HEIRS OF BERNARDINA ABALON vs. MARISSA ANDAL, LEONIL AND AL,
ARNEL AND AL, SPOUSES DOMINDOR PERALTA AND OFELIA PERALTA, and HEIRS of
RESTITUTO RELLAMA, represented by his children ALEX, IMMANUEL, JULIUS and
SYLVIA, all surnamed RELLAMA, G.R. No. 183448 / G.R. No. 183464, June 30, 2014, CJ.
Sereno
The established rule is that a forged deed is generally null and cannot convey title, the
exception thereto, pursuant to Section 55 of the Land Registration Act, denotes the
registration of titles from the forger to the innocent purchaser for value. Thus, the
qualifying point here is that there must be a complete chain of registered titles. This means
that all the transfers starting from the original rightful owner to the innocent holder for
value and that includes the transfer to the forger must be duly registered, and the title
must be properly issued to the transferee.
NORA B. CALALANG-PARULAN and ELVIRA B. CALALANG vs.ROSARIO CALALANGGARCIA, LEONORA CALALANG-SABILE, and CARLITO S. CALALANG, G.R. No. 184148,
June 9, 2014, J. Villarama, Jr.
Further strong proofs that the properties in question are the paraphernal properties of a
spouse are the very Torrens Titles covering said properties.
The phrase Pedro Calalang, married to Elvira Berba Calalang merely describes the civil
status and identifies the spouse of the registered owner Pedro Calalang. Evidently, this
does not mean that the property is conjugal. As the sole and exclusive owner, Pedro
Calalang had the right to convey his property in favor of Nora B. Calalang-Parulan by
executing a Deed of Sale on February 17, 1984. A close perusal of the records of this case
would show that the records are bereft of any concrete proof to show that the subject
property indeed belonged to respondents maternal grandparents. The evidence
respondents adduced merely consisted of testimonial evidence such as the declaration of
Rosario Calalang-Garcia that they have been staying on the property as far as she can
remember and that the property was acquired by her parents through purchase from her
105
maternal grandparents. However, she was unable to produce any document to evidence the
said sale, nor was she able to present any documentary evidence such as the tax
declaration issued in the name of either of her parents.
REPUBLIC OF THE PHILIPPINES vs. FRANKLIN M. MILLADO, G.R. No. 194066, June 4,
2014, J. Villarama, Jr.
Where the authority to proceed is conferred by a statute and the manner of obtaining
jurisdiction is mandatory, the same must be strictly complied with, or the proceedings will
be void. For non-compliance with the actual notice requirement to all other persons who
may have interest in the property, in this case the registered owners and/or their heirs, in
accordance with Section 13 in relation to Section 12 of RA 26, the trial court did not acquire
jurisdiction over L.R.A. The proceedings therein were therefore a nullity and the Decision
was void.
VERGEL PAULINO AND CIREMIA PAULINOvs.COURT OF APPEALS AND REPUBLIC OF
THE PHILIPPINES, represented by the ADMINISTRATOR of the LAND REGISTRATION
AUTHORITY, G.R. No. 205065, June 4, 2014, J. Mendoza
In reconstitution proceedings, the Court has repeatedly ruled that before jurisdiction over
the case can be validly acquired, it is a condition sine quo non that the certificate of title has
not been issued to another person. If a certificate of title has not been lost but is in fact in
the possession of another person, the reconstituted title is void and the court rendering the
decision has not acquired jurisdiction over the petition for issuance of new title. In the case
at bench, the CA found that the RTC lacked jurisdiction to order the reconstitution of the
original copy of TCT No. 301617, there being no lost or destroyed title over the real
property, the respondent having duly proved that TCT No. 301617 was in the name of a
different owner, Florendo, and the technical description appearing on that TCT No. 301617
was similar to the technical description appearing in Lot 939, Piedad Estate covered by TCT
No. RT-55869 (42532) in the name of Antonino.
DOLORES CAMPOS vs. DOMINADOR ORTEGA, SR. AND JAMES SILOS, G.R. No. 171286,
June 02, 2014, J. Peralta
It cannot be argued that Dolores had already acquired a vested right over the subject
property when the NHA recognized her as the censused owner by assigning to her a tag
number TAG No. 77-0063. While it is true that NHA recognizes Dolores as the censused
owner of the structure built on the lot, the issuance of the tag number is not a guarantee for
lot allocation. The census, tagging, and Dolores petition, did not vest upon her a legal title
to the lot she was occupying, but a mere expectancy that the lot will be awarded to her. The
expectancy did not ripen into a legal title when the NHA, informed her that her petition for
the award of the lot was denied.
106
AZNAR BROTHERS REALTY COMPANY vs. SPOUSES JOSE AND MAGDALENA YBAEZ,
G.R. No. 161380, April 21, 2014, J. Bersamin
The settled rule is that a free patent issued over a private land is null and void, and
produces no legal effects whatsoever. Private ownership of land as when there is a prima
facie proof of ownership like a duly registered possessory information or a clear showing of
open, continuous, exclusive, and notorious possession, by present or previous occupants
is not affected by the issuance of a free patent over the same land, because the Public Land
Law applies only to lands of the public domain. Lot No. 18563, not being land of the public
domain as it was already owned by Aznar Brothers, was no longer subject to the free patent
issued to the Spouses Ybaez.
Grey Alba vs. De la Cruz, 17 SCRA 49
The Torren system generally refer to the system of registration of transactions
with interest in land whose declared object is, under governmental authority, to
establish and certify to the ownership of an absolute and indefeasible title to
realty, and to simplify its transfer.
Legarda vs. Saleeby, G.R. NO. 8936, Oct. 2, 1915
The real purpose of the Torrens system of registration is to quiet title to land; to
put a stop forever to any question of the legality of the title, except claims
which were noted at the time of registration, in the certificate, or which may
arise subsequent thereto.
Government of the Philippine Islands v. Abural, 39 Phil. 996
The Torrens system aims to decree land titles that shall be final, irrevocable,
and indisputable, and to relieve the land of the burden of known as well as
unknown claims.
Sta. Lucia
vs.
Pasig, G.R.NO.
166838,
June
15,
2011
JAIME CARDINAL SIN, RAMON L. SIN, AND CEFERINA S. VITA G.R. No. 157485 March
26, 2014, J. Leonardo-De Castro
It is the respondent applicants which have the burden to identify a positive act of the
government, such as an official proclamation, declassifying inalienable public land into
disposable land for agricultural or other purposes. Since respondents failed to do so, the
alleged possession by them and by their predecessorsininterest is inconsequential and
could never ripen into ownership. Accordingly, respondents cannot be considered to
have private rights within the purview of Proclamation No. 2074 as to prevent the
application of said proclamation to the subject property.
Lands of the public domain that are patrimonial in character are susceptible to acquisitive
prescription and, accordingly, eligible for registration under Section 14(2) of P.D. No. 1529
but the period of acquisitive prescription would only begin to run from the time that the
State officially declares that the public dominion property is no longer intended for public
use, public service, or for the development of national wealth. The Court finds no evidence
of any official declaration from the state attesting to the patrimonial character of the
subject property. Cortez failed to prove that acquisitive prescription has begun to run
against the State, much less that he has acquired title to the subject property by virtue
thereof. It is of no moment that Cortez and his predecessors-in-interest have been in
possession of the subject property for 57 years at the time he applied for the registration of
title thereto. "[l]t is not the notorious, exclusive and uninterrupted possession and
occupation of an alienable and disposable public land for the mandated periods that
converts it to patrimonial. The indispensability of an official declaration that the property is
now held by the State in its private capacity or placed within the commerce of man for
prescription to have any effect against the State cannot be overemphasized.
REPUBLIC OF THE PHILIPPINES vs. SPS. JOSE CASTUERA AND PERLA CASTUERA, G.R.
No. 203384, January 14, 2015, J. Carpio
108
The applicant for land registration must prove that the DENR Secretary had approved the
land classification and released the land of the public domain as alienable and disposable,
and that the land subject of the application for registration falls within the approved area
per verification through survey by the PENRO or CENRO.
REMMAN ENTERPRISES, INC. vs. REPUBLIC OF THE PHILIPPINES, G.R. No. 188494,
November 26, 2014, J. Reyes
It is not enough for the PENRO or CENRO to certify that a land is alienable and disposable.
The applicant for land registration must prove that the DENR Secretary had appro ved the
land classification and released the land of the public domain as alienable and disposable,
and that the land subject of the application for registration falls within the approved area
per verification through survey by the PENRO or CENRO. In addition, the applicant for land
registration must present a copy of the original classification approved by the DENR
Secretary and certified as a true copy by the legal custodian of the official records. Thus, the
property registration of a corporation merely relying on the CENRO Certification must be
dismissed for failure to prove that the land had been declared alienable and disposable.
DANILO ALMERO, TERESITA ALAGON, CELIA BULASO, LUDY RAMADA, REGINA
GEGREMOSA, ISIDRO LAZARTE, THELMA EMBARQUE, FELIPE LAZARTE, GUILERMA
LAZARTE, DULCESIMA BENIMELEvs. HEIRS OF MIGUEL PACQUING, as represented by
LINDA PACQUING FADRILAN, G.R. No. 199008, November 19, 2014, J. Brion
Thus, in order for the homestead grantees or their direct compulsory heirs to retain their
homestead, the following conditions must be satisfied: (a) they must still be the owners of
the original homestead at the time of the CARL's effectivity, and (b) they must continue to
cultivate the homestead land. In this case, Linda, as the direct compulsory heir of the
original homestead grantee, is no longer cultivating the homestead land. That parcels of
land are covered by homestead patents will not automatically exempt them from the
operation of land reform. It is the continued cultivation by the original grantees or their
direct compulsory heirs that shall exempt their lands from land reform coverage."
HOLY TRINITY REALTY & DEVELOPMENT CORPORATION, vs. VICTORIO DELA CRUZ,
LORENZO MANALAYSAY, RICARDO MARCELO, JR. and LEONCIO DE GUZMAN, G.R. No.
200454, October 22, 2014, J. Bersamin
Consequently, before land may be placed under the coverage of Republic Act No. 6657, two
requisites must be met, namely: (1) that the land must be devoted to agricultural activity;
and (2) that the land must not be classified as mineral, forest, residential, commercial or
industrial land. For land to be covered under Presidential Decree No. 27, it must be devoted
to rice or corn crops, and there must be a system of share-crop or lease-tenancy obtaining
therein. Unfortunately, the Dakila property did not meet these requirements.
109
The Regalian doctrine, embodied in Section 2, Article XII of the 1987 Constitution, provides
that all lands of the public domain belong to the State, which is the source of any asserted
right to ownership of land. All lands not appearing to be clearly within private ownership
are presumed to belong to the State. Unless public land is shown to have been reclassified
or alienated to a private person by the State, it remains part of the inalienable public
domain for land classification or reclassification cannot be assumed. It must be proved.
In this case, the records do not support the findings made by the RTC and the CA that the
subject properties are part of the alienable and disposable portion of the public domain. It
bears noting that in support of his claim that the subject properties are alienable and
disposable, Raneses merely presented the Conversion Subdivision Plan which was
prepared by Engr. Montallana with the annotation that the subject properties were "inside
alienable and disposable land area Proj. No. 27-B as per LC Map No. 2623 certified by the
Bureau of Forestry on January 3, 1968" and the Inter-Office Memorandum from the LLDA.
Raneses failed to hurdle this burden and his reliance on the said annotation and Inter Office Memorandum is clearly insufficient. Clearly, the pieces of evidence submitted by
Raneses before the RTC in this case hardly satisfy the aforementioned documenta ry
requirements.
110
The burden of proof in overcoming the presumption of State ownership of the lands of the
public domain is on the person applying for registration or claiming ownership, who must
prove that the land is alienable or disposable. To overcome this presumption,
incontrovertible evidence must be established that the land is alienable or disposable.
There must be an existence of a positive act of the government such as a presidential
proclamation or an executive order; an administrative action; investigation reports of
Bureau of Lands investigators; or a legislative act or a statute. The applicant may also
secure a certification from the government that the land claimed to have been possessed
for the required number of years is alienable and disposable. In this case, petitioners cite a
surveyor geodetic engineer s notation indicating that the survey was inside alienable and
disposable land. Such notation does not constitute a positive government act validly
changing the classification of the land. A mere surveyor has no authority to reclassify lands
of the public domain. By relying solely on the said surveyor s assertion, petitioners have
not sufficiently proven that the land in question has been declared alienable."
REPUBLIC OF THE PHILIPPINES vs. FRANCISCA, GERONIMO AND CRISPIN, ALL
SURNAMED SANTOS, G.R. No. 191516, June 4, 2014, J. Peralta
Petitioner Republic assails the decision of the CA affirming in toto the decision of the trial
court holding that the respondents was able to prove that the subject lots had been
classified as alienable and disposable. Ruling in favor of Republic, the SC ruled that the
evidence required to establish that land subject of an application for registration is
alienable and disposable are: (1) CENRO or PENRO Certification; and (2) a copy of the
original classification approved by the DENR Secretary and certified as a true copy by the
legal custodian of the official records. In the present case, the foregoing documents had not
been submitted in evidence. There is no copy of the original classification approved by the
DENR Secretary. As ruled by this Court, a mere certification issued by the Forest Utilization
& Law Enforcement Division of the DENR is not enough. Republic is then correct that
evidence on record is not sufficient to prove that subject lots had been declared alienable
and disposable lands.
Republic vs. Santos, G.R.NO. 180027, July
18,
2012
Jura Regalia simply means that the State is the original proprietor of all lands
and, as such, is the general source of all private titles. Thus, pursuant to this
principle, all claims of private title to land, save those acquired from native
title, must be traced from some grant, whether express or implied, from the
State. Absent a clear showing that land had been let into private ownership
through the States imprimatur, such land is presumed to belong to the State.
111
20,
2012
Citizenship Requirement
Krivenko vs. Register of Deeds 79 Phil 461
Aliens mat not acquire private or public agricultural lands.
Ong Ching Po v. Court of Appeals G.R. NO. 113472, Dec. 20, 1994, 239
SCRA 341.
The capacity to acquire private land is made dependent upon the capacity to
acquire or hold lands of the public domain. Private land may be transferred or
only to individuals or entities qualified to acquire lands of the public domain.
Halili vs. Court of Appeals, 287 SCRA 465
A natural-born citizen of the Philippines who has lost his citizenship may be a
transferee of private lands, subject to limitations provided by law.
Director of Lands vs. Intermediate Appellate Court and Acme, 146 SCRA
509
The time to determine whether a person acquiring land is qualified is the time
the right to own it is acquired and not the time to register ownership.
112
Original Registration
LUZVIMINDA APRAN CANLAS vs. REPUBLIC OF THE PHILIPPINES, G.R. No. 200894,
November 10, 2014, J. Leonen
An applicant for land registration or judicial confirmation of incomplete or imperfect title
under Section 14(1) of Presidential Decree No. 1529 must prove the following
requisites:(1) that the subject land forms part of the disposable and alienable lands of the
public domain, and (2) that the applicant has been in open, continuous, exclusive and
notorious possession and occupation of the same under a bona fide claim of ownership
since June 12, 1945, or earlier. Concomitantly, the burden to prove these requisites rests on
the applicant. With regard to the first requisite, it is undisputed that the land subject of
registration is part of the alienable and disposable lands of the public domain. The trial
court found the Department of Environment and Natural Resources report sufficient to
prove the existence of the first requisite. The Court of Appeals decision was silent on this
matter. Respondent Republic failed to make objections on the issue as well. Thus, we do not
see any reason to deviate from the findings of the lower courts.
RODOLFO V. FRANCISCO vs. EMILIANA M. ROJAS, and the legitimate heirs of JOSE A.
ROJAS, namely: JOSE FERDINAND M. ROJAS II, ROLANDO M. ROJAS, JOSE M. ROJAS, JR.,
CARMELITA ROJAS-JOSE, VICTOR M.ROJAS, and LOURDES M. ROJAS, all represented
by JOSEFERDINAND M. ROJAS II, G.R. No. 167120, April 23, 2014, J. Peralta
A land registration court has no jurisdiction to order the registration of land already
decreed in the name of another in an earlier land registration case. After the promulgation
of the Guido, it can no longer be said that an original registration proceeding is proper,
since Guido held that certificate of title are genuine and authentic. What the land
registration court should have done was to dismiss the application for registration upon
learning that the same property was already covered by a valid title.
REPUBLIC OF THE PHILIPPINES VS. EMETERIA G. LUALHATI, G.R. No. 183511,
March 25, 2015, J. Peralta
Emeteria G. Lualhati filed with the RTC of Antipolo City an application for original
registration covering Lots 1 and 2 situated in C-5 C-6 Pasong Palanas, Sitio Sapinit, San
Juan, Antipolo, Rizal. To support her contention that the lands subject of her application is
alienable and disposable, Lualhati submitted certifications from the DENR-CENRO, Region
IV, Antipolo City, stating that no public land application or land patent covering the subject
lots is pending nor are the lots embraced by any administrative title. It has been repeatedly
ruled that certifications issued by the CENRO, or specialists of the DENR, as well as Survey
Plans prepared by the DENR containing annotations that the subject lots are alienable, do
not constitute incontrovertible evidence to overcome the presumption that the property
sought to be registered belongs to the inalienable public domain. Rather, this Court
stressed the importance of proving alienability by presenting a copy of the original
113
classification of the land approved by the DENR Secretary and certified as true copy by the
legal custodian of the official records.
Moreover, as petitioner Republic aptly points out, Lualhati failed to provide any other
proof of acts of dominion over the subject land other than the fact that she, together with
her husband and children, planted fruit-bearing trees and constructed their home thereon
considering the vastness of the same. A mere casual cultivation of portions of the land by
the claimant, and the raising thereon of cattle, do not constitute possession under claim of
ownership. In that sense, possession is not exclusive and notorious as to give rise to a
presumptive grant from the State.
REPUBLIC OF THE PHILIPPINES vs. SPOUSES DANTE and LOLITA BENIGNO, G.R. No.
205492, March 11, 2015, J. Del Castillo
The State is not estopped from the acts of the Clerk of Court in land registration cases.
Illegal acts of government agents do not bind the State. Assuming that it is, the respondents
did not prove that the land sought to be registered is an alienable and disposable land. All
applications for original registration under the Property Registration Decr ee must include
both (1) a CENRO or PENRO certification and (2) a certified true copy of the original
classification made by the DENR Secretary.
SURVIVING HEIRS OF ALFREDO R. BAUTISTA, namely: EPIFANIA G. BAUTISTA and
ZOEY G. BAUTISTA vs. FRANCISCO LINDO and WELHILMINA LINDO; and HEIRS OF
FILIPINA DAQUIGAN, IMELDA DAQUIGAN and CORSINO DAQUIGAN, REBECCA
QUIAMCO and ANDRES QUIAMCO, ROMULO LORICA and DELIA LORCIA, GEORGE
CAJES and LAURA CAJES, MELIDA BANEZ AND FRANCISCO BANEZ, MELANIE
GOFREDO, GERVACIO CAJES and ISABEL CAJES, EGMEDIO SEGOVIA and VERGINIA
SEGOVIA, ELSA N. SAM, PEDRO M. SAM, and LINA SAM, SANTIAGO MENDEZ and MINA
MENDEZ, HELEN M. BURTON and LEONARDO BURTON, JOSE JACINTO and
BIENVENIDA JACINTO, IMELDA DAQUIGAN, LEO MATIGA and ALICIA MATIGA,
FLORENCIO ACEDO JR., and LYLA VALERIO, G.R. No. 208232, March 10, 2014, J.
Velasco Jr.
Alfredo Bautista was awarded a free-patent land, which he subdivided and subsequently
sold to several vendees. He tried to repurchase the said lands three years later. The
Supreme Court held that while the deeds of sale do not explicitly contain the stipulation
that the sale is subject to repurchase by the applicant within a period of five (5) years from
the date of conveyance pursuant to Sec. 119 of CA 141, still, such legal provision is deemed
integrated and made part of the deed of sale as prescribed by law. It is basic that the law is
deemed written into every contract. Although a contract is the law between the parties, the
provisions of positive law which regulate contracts are deemed written therein and shall
limit and govern the relations between the parties. Thus, it is a binding prestation in favor
of Bautista which he may seek to enforce.
114
RAFAEL VALES, CECILIA VALES-VASQUEZ, and YASMIN VALES-JACINTO, vs. MA. LUZ
CHORESCA GALINATO, ERNESTO CHORESCA, TEOFILO AMADO, LORNA PARIAN
MEDIANERO, REBECCA PORCAL, and VIVENCIO ORDOYO, G.R. No. 180134, March 5,
2014, J. Perlas-Bernabe
DAR Memorandum provides that tenants should (a) have actual knowledge of unregistered
transfers of ownership of lands covered by Torrens Certificate of Titles prior to October 21,
1972, (b) have recognized the persons of the new owners, and (c) have been paying
rentals/amortization to such new owners in order to validate the transfer and bind the
tenants to the same. In the case at bar, it is undisputed that the subject sale was not
registered or even annotated on the certificates of title covering the subject lands.
SPOUSES MARIO AND JULIA CAMPOS, vs. REPUBLIC OF THE PHILIPPINES,G.R. No.
184371, March 5, 2014, J. Brion
Persons applying for registration of title under Section 14(1) of Presidential Decree No.
1529 must prove: (1) that the land sought to be registered forms part of the disposable and
alienable lands of the public domain, and (2) that they have been in open, continuous,
exclusive and notorious possession and occupation of the same under a bona fide claim of
ownership since June 12, 1945, or earlier. It is emphasized that since the effectivity of P.D.
No. 1073 on January 25, 1977, a mere showing of possession and occupation for thirty (30)
years or more is no longer sufficient.
SPS. ANTONIO FORTUNA AND ERLINDA FORTUNA, vs. REPUBLIC OF THE
PHILIPPINES,G.R. No. 173423, March 05, 2014, J. Brion
Mere notations appearing in survey plans are inadequate proof of the covered properties
alienable and disposable character. These notations, at the very least, only establish that
the land subject of the application for registration falls within the approved alienable and
disposable area per verification through survey by the proper government office. The
applicant, however, must also present a copy of the original classification of the land into
alienable and disposable land, as declared by the DENR Secretary or as proclaimed by the
President.
THE HON. SECRETARY OF THE DEPARTMENT OF AGRARIAN REFORM VS. NEMESIO
DUMAGPI, REPRESENTED BY VICENTE DUMAGPI, G.R. No. 195412, February 04,
2015, J. Reyes
The respondent claims that he is the owner of the disputed parcel of land by virtue of
his open, exclusive, notorious and continuous possession of the land for more than 30
years. The Supreme Court ruled that adverse possession can only ripen into ownership
when the land adversely owned is classified as an agricultural land. If the disputed land
is non-agricultural, adverse possession cannot ripen into ownership.
115
An applicant for original registration of title based on a claim of exclusive and continuous
possession or occupation must show the existence of the following: (1) Open, continuous,
exclusive and notorious possession, by themselves or through their predecessors -ininterest, of land; (2) The land possessed or occupied must have been declared alienable and
disposable agricultural land of public domain; (3) The possession or occupation was under
a bona fide claim of ownership; (4) Possession dates back to June 12, 1945 or earlier.
Therefore, what is important in computing the period of possession is that the land has
already been declared alienable and disposable at the time of the application for
registration. Upon satisfaction of this requirement, the computation of the period may
include the period of adverse possession prior to the declaration that land is alie nable and
disposable.
In the present case, there is no dispute that the subject lot has been declared alienable and
disposable on March 15, 1982. This is more than eighteen (18) years before Roasa's
application for registration, which was filed on December 15, 2000. Moreover, the
unchallenged testimonies of two of Roasa's witnesses established that the latter and her
predecessors-in-interest had been in adverse, open, continuous, and notorious possession
in the concept of an owner even before June 12, 1945.
LUZVIMINDA APRAN CANLAS vs. REPUBLIC OF THE PHILIPPINES, G.R. No.
200894. November 10, 2014, J. Leonen
An applicant for land registration or judicial confirmation of incomplete or imperfect title
under Section 14(1) of Presidential Decree No. 1529 must prove the following
requisites:"(1) that the subject land forms part of the disposable and alienable lands of the
public domain, and (2) that [the applicant has] been in open, continuous, exclusive and
notorious possession and occupation of the same under a bona fide claim of ownership
since June 12, 1945, or earlier." Concomitantly, the burden to prove these requisites rests
on the applicant.
The two requisites were complied with in this case. With regard to the first requisite, the
land subject of registration is part of the alienable and disposable lands of the public
domain by virtue of Department of Environment and Natural Resources report. With
regard to the second requisite, applicant acquired the property by inheritance from
Honorio and Gregorio S. Apran and she and her predecessors-in-interest have been in its
continuous possession of the alienable and disposable parcel of land of the public domain
under a bona fide claim of ownership since 1900.
116
IMELDA LEONARDO, FIDELINO AZUCENA, JOSEFINA, ANITA AND SISA ALL SURNAMED
SYJUCO VS. FELISA D. BONIFACIO AND VSD REALTY & DEVELOPMENT CORPORATION,
G.R. No. 148748. January 14, 2015, J. LEONARDO-DE CASTRO
SC found untenable the contention that the action instituted by petitioners is a prohibited
collateral attack on the certificate of title of respondents over the subject land.
To determine whether an attack on a certificate of title is direct or indirect, the relevance of
the object of the action instituted and the relief sought therein must be examined.
When is an action an attack on a title? It is when the object of the action or proceeding is to
nullify the title, and thus challenge the judgment pursuant to which the title was decreed.
The attack is direct when the object of an action or proceeding is to annul or set aside such
judgment, or enjoin its enforcement. On the other hand, the attack is indirect or collateral
117
A survey plan does not constitute incontrovertible evidence to overcome the presumption
that the subject property remains part of the inalienable public domain. Cortez failed to
present a certification from the proper government agency as to the classification of the
subject property. Cortez likewise failed to present any evidence showing that the DENR
Secretary had indeed classified the subject property as alienable and disposable.
REPUBLIC OF THE PHILIPPINES vs. REMMAN ENTERPRISES, INC., represented by RONNIE P.
INOCENCIO, G.R. No. 199310 February 19, 2014, J. REYES
To prove that the subject property forms part of the alienable and disposable lands of the
public domain, the respondent presented two certifications issued by Senior Forest
Management Specialist of the DENR attesting that Lots form part of the aliena ble and
disposable lands of the public domain "under Project No. 27-B of Taguig, Metro Manila as
per LC Map 2623, approved on January 3, 1968." However, the said certifications are
insufficient to prove that the subject properties are alienable and disposable. The
certification issued by the proper government agency that a parcel of land is alienable and
disposable, applicants for land registration must prove that the DENR Secretary had
approved the land classification and released the land of public domain as alienable and
disposable. They must present a copy of the original classification approved by the DENR
Secretary and certified as true copy by the legal custodian of the records.
With regard to possession, although it was testified that the respondent and its
predecessors-in-interest cultivated the subject properties, by planting different crops
thereon, his testimony is bereft of any specificity as to the nature of such cultivation as to
warrant the conclusion that they have been indeed in possession and occupation of the
subject properties in the manner required by law. There was no showing as to the number
of crops that are planted in the subject properties or to the volume of the produce
harvested from the crops supposedly planted thereon.
118
Further, assuming ex gratia argumenti that the respondent and its predecessors-in-interest
have indeed planted crops on the subject properties, it does not necessarily follow that the
subject properties have been possessed and occupied by them in the manner contemp lated
by law. The supposed planting of crops in the subject properties may only have amounted
to mere casual cultivation, which is not the possession and occupation required by law.
REPUBLIC OF THE PHILIPPINES VS. ZURBARAN REALTY & DEVELOPMENT CORP. G.R.
No. 164408, March 24, 2014, J. BERSAMIN
Registration under Section 14(1) of P.D. No. 1529 is based on possession and occupation of
the alienable and disposable land of the public domain since June 12, 1945 or earlier,
without regard to whether the land was susceptible to private ownership at that time. The
applicant needs only to show that the land had already been declared alienable and
disposable at any time prior to the filing of the application for registration.
On the other hand, an application under Section 14(2) of P.D. No. 1529 is based on
acquisitive prescription and must comply with the law on prescription as provided by the
Civil Code. In that regard, only the patrimonial property of the State may be acquired by
prescription pursuant to the Civil Code. For acquisitive prescription to set in, therefore, the
land being possessed and occupied must already be classified or declared as patrimonial
property of the State. Otherwise, no length of possession would vest any right in the
possessor if the property has remained land of the public dominion. Malabanan stresses
that even if the land is later converted to patrimonial property of the State, possession of it
prior to such conversion will not be counted to meet the requisites of acquisitive
prescription. Thus, registration under Section 14(2) of P.D. No. 1529 requires that the land
had already been converted to patrimonial property of the State at the onset of the period
of possession required by the law on prescription.
An application for registration based on Section 14(2) of P.D. No. 1529 must, therefore,
establish the following requisites, to wit: (a) the land is an alienable and disposable, and
patrimonial property of the public domain; (b) the applicant and its predecessors -ininterest have been in possession of the land for at least 10 years, in good faith and with just
title, or for at least 30 years, regardless of good faith or just title; and (c) the land had
already been converted to or declared as patrimonial property of the State at the begin ning
of the said 10-year or 30-year period of possession.
16,
2012
M etro Index
The mere planting of a sign or symbol of possession cannot justify a Magellan like claim of dominion over an immense tract of territory. Possession as a
means of acquiring ownership, while it may be constructive, is not a mere
fiction.
Roman Catholic Apostolic Administrator
Registration Commission, 102 Phil. 596.
of
Davao,
Inc.
vs.
Land
A corporation sole, which consists of one person only, is vested with the right
to purchase and hold real estate and to register the same in trust for the
faithful or members of the religious society or church for which the corporation
was organized.
Subsequent Registration
Lucena vs. CA, G.R. NO. L-77468, August 25, 1999
It is a well-settled rule that a purchaser cannot close his eyes to facts which
should put a reasonable man upon his guard, and then claim that he acted in
good faith under the belief that there was no defect in the title of the vendor.
His mere refusal to believe that such defect exists, or his willful closing of his
121
eyes to the possibility of the existence of a defect in his vendor's title, will not
make him an innocent purchaser for value, if it afterwards develops that the
title was in fact defective, and it appears that he had such notice of the defect
as would have led to its discovery had he acted with that measure of
precaution which may reasonably be required of a prudent man in a like
situation.
Heirs of Brusas vs. CA, G.R. No. 126875, August 26, 1999
In the instant case, the litigated property is still registered in the name of Ines
Brusas, so that insofar as procedure is concerned, petitioners were correct in
availing of the remedy of reconveyance. However, an action for reconveyance
presupposes the existence of a defrauded party who is the lawful owner of the
disputed property.
Philippine National Bank vs. Court of Appeals, 98 SCRA 207
A person dealing with registered land is not required to go behind the register
to determine the condition of the property. He is only charged with notice of the
burdens on the property which are noted on the face of the register or the
certificate of title. To require him to do more is to defeat one of the primary
objects of the Torrens system.
Potenciano vs. Dineros, G.R. No. L-7614, M ay 31, 1955
The judgment creditor may not, as purchaser at the auction sale, invoke the
protection accorded by law to purchasers in good faith, because at the time of
the auction he already had notice, thru the third party claim filed by
Potenciano, that the property had already been acquired by the latter from the
judgment debtor.
Guaranteed Homes Inc vs. Valdez, G.R. No. 171531, Jan. 30, 2009
Every conveyance, mortgage, lease, lien, attachment, order, judgment,
instrument or entry affecting registered land shall, if registered, filled or
entered in the office of the Register of Deeds of the province or city where the
land to which it relates lies, be constructive notice to all persons from the time
of such registering filing or entering.
Fudot vs. Cattleya Land Inc., G.R. No. 171008 , Sept. 13, 2007
The registration of a void deed, for instance, is not an impediment to a
declaration by the courts of its invalidity.
122
Non-Registrable Properties
Malabanan vs. Republic, 587 SCRA 172
Only when the property has become patrimonial can the prescriptive period for
the acquisition of property of the public domain begin to run.
Foreshore and submerged areas irrefutably belonged to the public domain and
were inalienable unless reclaimed, classified as alienable lands open to
disposition and further declared no longer needed for public service. The fact
that alienable lands of the public domain were transferred to the PEA (now
PRA) and issued land patents or certificates of title in PEAs name did not
automatically make such lands private.
Republic vs. Paraaque G.R.NO. 191109, July 18, 2012
The subject reclaimed lands are still part of the public domain, owned
by the State and, therefore, exempt from payment of real estate taxes.
Here, the subject lands are reclaimed lands, specifically portions of the
foreshore and offshore areas of Manila Bay. As such, these lands
remain public lands and form part of the public domain.
Dealings with Unregistered Land
Heirs of Tanyag
vs.
Gabriel, 669
SCRA
284
There must be an express declaration by the State that the public dominion
property is no longer intended for public service or the development of the
national wealth or that the property has been converted into patrimonial.
Without such express declaration, the property, even if classified as alienable
or disposable, remains property of the public dominion, pursuant to Article
420(2), and thus incapable of acquisition by prescription.
For one to invoke the provisions of Section 14(2) and set up acquisitive
prescription against the State, it is primordial that the status of the property as
patrimonial be first established. Furthermore, the period of possession
preceding the classification of the property as patrimonial cannot be considered
in determining the completion of the prescriptive period.
124
attorney duly notarized, mere inspection of the face of such public document already
constitutes sufficient inquiry. If no such special power of attorney is provided or there is
one but there appears to be flaws in its notarial acknowledgment, mere inspection of the
document will not do; the buyer must show that his investigation went beyond the
document and into the circumstances of its execution.
In the present case, it is undisputed that Spouses Sarili purchased the subject property
from Ramos on the strength of the latter s ostensible authority to sell under the subject
SPA. The said document, however, readily indicates flaws in its notarial acknowledgment
since the respondent s community tax certificate CTC number was not indicated thereon.
Despite this irregularity, however, Spouses Sarili failed to show that they conducted an
investigation beyond the subject SPA and into the circumstances of its execution as
required by prevailing jurisprudence. Hence, Spouses Sarili cannot be considered as
innocent purchasers for value.
FLORENTINO W. LEONG AND ELENA LEONG, ET AL. vs. EDNA C. SEE, G.R. No. 19407 7,
December 03, 2014, J. Leonen
An innocent purchaser for value refers to someone who buys the property of another
without notice that some other person has a right to or interest in it, and who pays a full
and fair price at the time of the purchase or before receiving any notice of ano ther person s
claim. One claiming to be an innocent purchaser for value has the burden of proving such
status. Respondent exerted due diligence when she ascertained the authenticity of the
documents attached to the deed of sale such as the marital settlement agreement with
Florentino s waiver of interest over the property. She did not rely solely on the title. She
even went to the Registry of Deeds to verify the authenticity of the title. The Supreme Court
upheld the ruling of the lower courts which considered the inquiries made by respondent
to be acts of an innocent purchaser in good faith and for value.
KRYSTLE REALTY DEVELOPMENT CORPORATION, rep. by CHAIRMAN OF THE
BOARD, WILLIAM C. CU vs. DOMINGO ALIBIN, as substituted by his heirs, G.R. No.
196117/G.R. No. 196129, August 13, 2014, J. Perlas-Bernabe
One is considered a buyer in bad faith not only when he purchases real estate with
knowledge of a defect or lack of title in his seller but also when he has knowledge of facts
which should have alerted him to conduct further inquiry or investigation, as Krystle Realty
in this case. Further, as one asserting the status of a buyer in good faith and for value, it had
the burden of proving such status, which goes beyond a mere invocation of the ordinary
presumption of good faith.
The agreement of the parties to submit the determination of the genuineness of Domingo s
signature to a handwriting expert of the NBI does not, authorize the RTC to accept the
findings of such expert. The opinion of a handwriting expert, therefore, does not
126
mandatorily bind the court, the expert's function being to place before the court data upon
which it can form its own opinion.
RAUL SABERON, JOAN F. SABERON and JACQUELINE SABERON vs. OSCAR
VENTANILLA, JR., and CARMEN GLORIA D. VENTANILLA, G.R. No. 192669, April 21,
2014, J. Mendoza
While a third party may not be considered as innocent purchaser for value, he can still
rightfully claim for actual and compensatory damages, considering that he did not join the
other defendants in their efforts to frustrate plaintiffs rights over the disputed properties
and who might well be an unwilling victim of the fraudulent scheme employed by the other
defendants.
Nonetheless, even if when no bad faith can be ascribed to the parties alike, an equal footing
of the parties necessarily tilts in favor of the superiority of the notice of levy and the
constructive notice against the whole world which the original party to the contract of sale
had produced and which effectively bound third persons. Thus, the latter has two options
available: 1) they may exercise the right to appropriate after payment of indemnity
representing the value of the improvements introduced and the necessary and useful
expenses defrayed on the subject lots; or 2) they may forego payment of the said indemnity
and instead, oblige the Saberons to pay the price of the land.
ALFARO VS. DUMALAGAN, G.R. No.186622, January 22, 2014, J. Perez
A purchaser in good faith is one who buys the property of another without notice that some
other person has a right to, or an interest in such property, and pays a full and fair price for
the same at the time of such purchase, or before he has notice of some other person s claim
or interest in the property. The petitioners are not such purchaser.
Petitioners had prior knowledge of the previous sales by installment of portions of the
property to several purchasers. Moreover, petitioners had prior knowledge of responden ts
possession over the subject property. Hence, the rule on double sale is inapplicable in the
case at bar. As correctly held by the appellate court, petitioners prior registration of the
subject property, with prior knowledge of respondents claim of ownership and possession,
cannot confer ownership or better right over the subject property.
SPOUSES BERNADETTE and RODULFO VILLABAR VS.ANGELITO L. OPININ, G.R. N.O
17604, January 15, 2014. J. del Castillo
Bad faith cannot be presumed. It is a question of fact that must be proven by clear and
convincing evidence. The burden of proving bad faith rests on the one alleging it. Spouses
Vilbar failed to adduce the necessary evidence. Furthermore, the Court recognizes the
settled rule that levy on attachment, duly registered, takes preference over a prior
unregistered sale. This result is a necessary consequence of the fact that the properties
involved were duly covered by the Torrens system which works under the fundamental
127
principle that registration is the operative act which gives validity to the transfer or creates
a lien upon the land.
JUST COMPENSATION
LAND BANK OF THE PHILIPPINES vs. JAIME K. IBARRA, ANTONIO K. IBARRA, JR., LUZ
IBARRA VDA. DE JIMENEZ, LEANDRO K IBARRA, and CYNTHIA IBARRAGUERRERO, G.R. No. 182472. November 24, 2014, J. Peralta
The petitioner s lands were subjected to the coverage of the agrarian reform program. The
petitioner then filed a complaint for just compensation of the said land. The issue in the
case is what will be the basis of valuation of the property taken for Just Compensation.
The Supreme Court held that the seizure of landholdings or properties covered by PD No.
27 did not take place on October 21, 1972, but upon the payment of just
compensation. Indeed, acquisition of property under the Operation Land Transfer Program
under PD No. 27 does not necessarily mean that the computation of just compensation
thereof must likewise be governed by the same law. In determining the applicable formula,
the date of the payment of just compensation must be taken into consideration for such
payment marks the completion of the agrarian reform process. If the agrarian reform
process is still incomplete as when just compensation is not settled prior to the passage of
RA No. 6657, it should be computed in accordance with said law despite the fact that the
property was acquired under PD No. 27. Clearly, by law and jurisprudence, R.A. No. 6657,
upon its effectivity, became the primary law in agrarian reform covering all then pending
and uncompleted processes, with P.D. No. 27 and E.O. No. 228 being only suppletory to the
said law.
It is, therefore, on equitable considerations that the retroactive application of RA No. 6657
is based for it would be highly inequitable on the part of the landowners to compute just
compensation using the values not at the time of the payment but at the time of the taking
in 1972, considering that the government and the farmer-beneficiaries have already
benefitted from the land.
CANCELLATION OF TITLE
ROSARIO BANGUIS-TAMBUYAT vs. WENIFREDA BALCOM-TAMBUYAT, G.R. No.
202805, March 23, 2015, J. Del Castillo
Under Sec. 108 of PD 1529, the proceeding for the erasure, alteration, or amendment of a
certificate of title may be resorted to in seven instances: (1) when registered interests of
any description, whether vested, contingent, expectant, or inchoate, have terminated and
ceased; (2) when new interests have arisen or been created which do not appear upon the
certificate; (3) when any error, omission or mistake was made in entering a certificate or
128
any memorandum thereon or on any duplicate certificate; (4) when the name of any person
on the certificate has been changed; (5) when the registered owner has been married, or,
registered as married, the marriage has been terminated and no right or interest of heirs or
creditors will thereby be affected; (6) when a corporation, which owned registered land
and has been dissolved, has not conveyed the same within three years after its dissolution;
and (7) when there is reasonable ground for the amendment or alteration of title. The
present case falls under (3) and (7), where the Registrar of Deeds of Bulacan committed an
error in issuing TCT Tin the name of Adriano M. Tambuyat married to Rosario E.
Banguis when, in truth and in fact, respondent Wenifreda and not Banguis is Adriano s
lawful spouse.
ACTION FOR RECONVEYANCE
HEIRS OF FRANCISCO I. NARVASA, SR., ANDHEIRS OF PETRA IMBORNAL AND
PEDRO FERRER,REPRESENTED BY THEIR ATTORNEY -IN-FACT, MRS. REMEDIOS B.
NARVASA-REGACHO vs. EMILIANA, VICTORIANO, FELIPE, MATEO, RAYMUNDO,
MARIA,AND EDUARDO, ALL SURNAMED IMBORNAL, G.R. No. 182908, August 06,
2014, J. Perlas Bernabe
An action for reconveyance based on an implied trust prescribes in ten (10) years,
reckoned from the date of registration of the deed or the date of issuance of the certificate
of title over the property, if the plaintiff is not in possession. Hence, when a complaint for
reconveyance is filed beyond the 10-year reglementary period, such cause of action is
barred by prescription.
HEIRS OF TELESFORO JULAO, namely, ANITA VDA. DE ENRIQUEZ, SONIA J.
TOLENTINO and RODERICK JULAO v SPOUSES ALEJANDRO and MORENITA DE JESUS,
G.R No. 176020, September 29, 2014. DEL CASTILLO.
In an action to recover, the property must be identified. Article 434 of the Civil Code states
that "[i]n an action to recover, the property must be identified, and the plaintiff must rely
on the strength of his title and not on the weakness of the defendant's claim." The plaintiff,
therefore, is duty-bound to clearly identify the land sought to be recovered, in accordance
with the title on which he anchors his right of ownership. It bears stressing that the failure
of the plaintiff to establish the identity of the property claimed is fatal to his case. In this
case, petitioners failed to identify the property they seek to recover as they failed to
describe the location, the area, as well as the boundaries thereof. No survey plan was
presented by petitioners to prove that respondent spouses actually encroached upon the
70-square meter portion of petitioners' property.
TORTS AN D DAM AGES
THE TORTFEASOR
129
by the Court in this case, may be stated as follows: Where the thing which
caused the injury complained of is shown to be under the management of the
defendant or his servants and the accident is such as in the ordinary course of
things does not happen if those who have its management or control use
proper care, it affords reasonable evidence, in the absence of explanation by
the defendant, that the accident arose from want of care.
Phoenix Construction, Inc. vs. Dionisio, 148 SCRA 353
The driver of a dump truck parked it improperly at night near his residence
and it was bumped by the driver of a car, who suffered damages. The
proximate cause of the accident was the improper parking of the dump truck.
Africa vs. Caltex, 16 SCRA 448
A fire broke out at a gasoline station while gasoline was being hosed from a
tank truck into the underground storage, right at the opening of the receiving
tank where the nozzle of the hose was inserted, as a result of which several
houses were burned. Under the principle of res ipsa loquitor, the employees
negligence was the proximate cause of the fire which in the ordinary course of
things does not happen.
Gabeto vs. Araneta, 42 Phil. 232
Araneta stopped a calesa with passengers aboard on the street and seized the
rein of the horses bridle, by reason of which the driver brought the carromata
to the adjacent curb and alighted to fix the bridle, and while the driver was
engaged at the horses head, the horse moved forward bringing down a police
telephone box, and because of the noise caused thereby, the horse was
frightened and it ran away and one of the passengers jumped and was killed.
Araneta's act in stopping the horse was held as not the proximate cause of the
accident because the bridle was old, and the leather of which it was made was
probably so weak as to be easily broken.
131
to allocate them among the members of society. To accept the petitioners' proposition must tend to weaken the very bonds of society.
Cebu Shipyard and Engineering W orks, Inc. vs. W illiam Lines, Inc., 306
SCRA 762
The passenger ship of William Lines, Inc. caught fire and sank while in the
custody of Cebu Shipyard and Engineering Works to which it was brought for
annual repair. The doctrine of res ipsa loquitor applies here because the fire
that occurred and consumed MV Manila City would not have happened in the
ordinary course of things if reasonable care and diligence had been exercised
by Cebu Shipyard.
Radio Communications of the Phils., Inc. [RCP I] vs. Court of Appeals, 143
SCRA 657
133
LEGAL INJURY
Custodio vs. Court of Appeals, 253 SCRA 483
Custodio filed a case for damages because his tenants cancelled their contract
of lease due to adobe fences constructed by adjoining lot owners which
restricted passage from and to his apartment. To warrant the recovery of
damages, there must be both a right of action for a legal wrong inflicted by the
defendant, and damage resulting to the plaintiff therefrom as a wrong without
damage, or damage without wrong, does not constitute a cause of action, since
damages are merely part of the remedy allowed for the injury caused by a
breach or wrong.
Metropolitan Bank and Trust Company vs. Tan Chuan Leong, 42 SCRA
352
Although B&I Trading had knowledge of the simulated sale between Tan Chuan
Leong and his son and had entered into the contract of mortgage pursuant to a
design to defraud Leongs creditors, no damage or prejudice appears to have
been suffered by the petitioner thereby. Absent damage or prejudice, no right of
action arises in favor of the petitioner because wrongful violation of a legal right
is not a sufficient element of a cause of action unless it has resulted in an
injury causing loss or damages.
INTENTIONAL TORTS
Yu vs. Court of Appeals, 217 SCRA 328
House of Mayfair, a foreign manufacturer of wall covering products, with which
Yu has had an exclusive distributorship aageement was duped into believing
that the goods ordered through the FNF Trading were to be shipped to Nigeria
only, but the goods were actually sent to and sold in the Philippines. A ploy of
this character is akin to the scenario of a third person who induces a party to
renege on or violate his undertaking under a contract, thereby entitling the
other contracting party to relief therefrom.
134
Valenzuela vs. Court of Appeals, G.R. NO. 83122, October 19, 1990
Valenzuela did not receive his full commission which amounted to P1.6 Million
from the P4.4 Million insurance coverage of the Delta Motors he obtained for
Philippine American General Insurance (Philamgen) because the Philamgen
terminated their agency agreement after Valenzuela refused to share his
commission with the company. Philamgen was found to have acted with bad
faith and with abuse of right in terminating the agency under the principle that
every person must in the exercise of his rights and in the performance of his
duties act with justice, give everyone his due, and observe honesty and good
faith (Art. 19, Civil Code), and every person who, contrary to law, willfully or
negligently causes damages to another, shall indemnify the latter for the same.
NEGLIGENCE
DR. FILOTEO A. ALANO vs, ZENAIDA MAGUD-LOGMAO, G.R. No. 175540, April 7, 2014, J.
Peralta
It also clearly stated that permission or authorization to retrieve and remove the internal
organs of the deceased was being given ONLY IF the provisions of the applicable law had
been complied with. Such instructions reveal that Dr. Alano acted prudently by directing
his subordinates to exhaust all reasonable means of locating the relatives of the deceased.
He could not have made his directives any clearer. He even specifically mentioned that
permission is only being granted IF the Department of Surgery has complied with all the
requirements of the law. Verily, Dr. Alano could not have been faulted for having full
confidence in the ability of the doctors in the Department of Surgery to comprehend the
instructions, obeying all his directives, and acting only in accordance with the requirements
of the law.
DAVAO HOLIDAY TRANSPORT SERVICES CORPORATION vs. SPOUSES EULOGIO AND
CARMELITA EMPHASIS, G.R. No. 211424, November 26, 2014, J. Reyes
Contending that it exercised extraordinary diligence in the selection and supervision of its
drivers, petitioner argues that it should be absolved from any liability for damages caused
by its employee. The SC ruled that when an employee causes damage due to his own
negligence while performing his own duties, there arises the juris tantum presumption that
his employer is negligent, rebuttable only by proof of observance of the diligence of a good
father of a family. Failure however of petitioner to establish the modes and measures it
adopted to ensure the proper selection and supervision of its employees, petitioner
therefore should be held liable for the damages cause by its employee.
135
Exemplary damages should also be awarded. The law allows the grant of exemplary
damages by way of example for the public good. The public relies on the banks sworn
profession of diligence and meticulousness in giving irreproachable service, which must be
maintained at all times by the banking sector.
RUKS KONSULT AND CONSTRUCTION vs. ADWORLD SIGN AND ADVERTISING
CORPORATION* AND TRANSWORLD MEDIA ADS, INC., G.R. No. 204866, January 21,
2015, J. Perlas-Bernabe
The petitioners were found negligent by both the RTC and the Court of Appeals and
ordered to pay jointly and severally for damages. The petitioners allege that they are not
negligent. The Supreme Court ruled that as the omission to do something which a
reasonable man, guided by those considerations which ordinarily regulate the conduct of
human affairs, would do, or the doing of something which a prudent and reasonable man
would not do. It is the failure to observe for the protection of the interest of another person
136
that degree of care, precaution, and vigilance which the circumstances justly demand,
whereby such other person suffers injury. CA correctly affirmed the RTC s finding that
Transworld and Ruks are guilty of negligence.
R TRANSPORT CORPORATIONvs. LUISITO G. YU, G.R. No. 174161, February 18, 2015,
J. Peralta
Negligence has been defined as "the failure to observe for the protection of the interests of
another person that degree of care, precaution, and vigilance which the circumstances
justly demand, whereby such other person suffers injury. Verily, foreseeability is the
fundamental test of negligence. It is the omission to do something which a reasonable man,
guided by those considerations which ordinarily regulate the conduct of human affairs,
would do, or the doing of something which a prudent and reasonable man would not do.
The records show that driver Gimena was clearly running at a reckless speed. He did not
take the necessary precaution and instead, drove on and bumped the deceased despite
being aware that he was traversing a commercial center where pedestrians were crossing
the street. Gimena should have observed due diligence of a reasonably prudent man by
slackening his speed and proceeding cautiously while passing the area.
UNKNOWN OWNER OF THE VESSEL M/V CHINA JOY, SAMSUN SHIPPING LTD.,
AND INTER-ASIA MARINE TRANSPORT, INC. vs. ASIAN TERMINALS, INC., G.R.
No. 195661, March 11, 2015, J. Reyes
AT) suffered damage due to the fault of petitioners negligence. (owever, petitioners
contended that they should not be held liable for there was no negligence on their part. The
court ruled that Negligence, on the other hand, is defined as the failure to observe that
degree of care, precaution and vigilance that the circumstances justly demand, whereby
another suffers injury. In the case under consideration, the parties do not dispute the facts
of damage upon AT) s unloader, and of such damage being the consequence of someone s
negligence. However, the petitioners deny liability claiming that it was not established with
reasonable certainty whose negligence had caused the co-mingling of the metal bars with
the soybean meal cargo. The Court, on this matter, agrees with the CA s disquisition that
the petitioners should be held jointly and severally liable to ATI. ATI cannot be faulted for
its lack of direct access to evidence determinative as to who among the shipowner, Samsun,
ContiQuincyBunge and Inter-Asia should assume liability. The CA had exhaustively
discussed why the doctrine of res ipsa loquitur applies.
EASTERN SHIPPING LINES, INC., Petitioner, v. BPI/MS INSURANCE CORP., & MITSUI
SUMITOMO INSURANCE CO., LTD. G.R. No. 182864. January 12, 2015, J. PEREZ
Mere proof of delivery of the goods in good order to a common carrier and of their arrival
in bad order at their destination constitutes a prima facie case of fault or negligence against
the carrier. If no adequate explanation is given as to how the deterioration, loss, or
137
destruction of the goods happened, the transporter shall be held responsible. From the
foregoing, the fault is attributable to ESLI. While no longer an issue, it may be nonetheless
state that ATI was correctly absolved of liability for the damage.
BJDC CONSTRUCTION, REPRESENTED BY ITS MANAGER/PROPRIETOR JANET S. DELA CRUZ
vs. NENA E. LANUZO, CLAUDETTE E. LANUZO, JANET E. LANUZO, JOAN BERNABE E. LANUZO,
AND RYAN JOSE E. LANUZO, G.R. No. 161151 March 24, 2014, J. BERSAMIN
This case involves a claim for damages arising from the death of a motorcycle rider in a
night time accident due to the supposed negligence of a construction company then
undertaking reblocking work on a national highway. The plaintiffs insisted that the
accident happened because the construction company did not provide adequate lighting on
the site, but the latter countered that the fatal accident was caused by the negligence of the
motorcycle rider himself. In order that a party may be held liable for damages for any
injury brought about by the negligence of another, the claimant must prove that the
negligence was the immediate and proximate cause of the injury. Proximate cause is
defined as that cause, which, in natural and continuous sequence, unbroken by any
efficient intervening cause, produces the injury and without which the result would not
have occurred.
The company has shown the installation of the necessary warning signs and lights in the
project site. In that context, the fatal accident was not caused by any instrumentality within
the exclusive control of the company. In contrast, Balbino had the exclusive control of how
he operated and managed his motorcycle. The records disclose that he himself did not take
the necessary precautions. As Zamora declared, Balbino overtook another motorcycle rider
at a fast speed, and in the process could not avoid hitting a barricade at the site, caus ing
him to be thrown off his motorcycle onto the newly cemented road. SPO Corporal s
investigation report corroborated Zamora s declaration. )t was shown that the proximate
and immediate cause of the death of Balbino was his own negligence. Hence, the heirs could
not recover damages.
VICENTE JOSEFA v MANILA ELECTRIC COMPANY, G.R No. 182705, July 18, 2014.
J. BRION
Paragraph 5, Article 2180 of the Civil Code holds the employer vicariously liable for
damages caused by his employees within the scope of their assigned tasks. In this case,
Josefa seeks to avoid the application of this provision by denying that Bautista was his
employee at the time of the incident.
Josefa cannot evade his responsibility by mere denial of his employment relations with
Bautista in the absence of proof that his truck was used without authorization or that it was
stolen when the accident occurred. In quasi-delict cases, the registered owner of a motor
vehicle is the employer of its driver in contemplation of law. The registered owner of any
vehicle, even if not used for public service, would primarily be responsible to the public or
to third persons for injuries caused while the vehicle was being driven on highways or
138
streets. The purpose of motor vehicle registration is precisely to identify the owner so that
if any injury is caused by the vehicle, responsibility can be imputed to the registered owner.
INDOPHIL TEXTILE MILLS, INC v ENGR. SALVADOR ADVIENTO, G.R No. 171212,
August 4, 2012. PERALTA.
Engr. Adviento was hired by Indophil Textile Mills to maintain its thread-manufacturing
facilities. Later he was diagnosed with Chronic Poly Sinusitis. Engr. Adviento filed a case for
damages based on quasi-delict with the RTC, alleging that he contracted such occupational
disease by reason of the gross negligence of petitioner to provide him with a safe, healthy
and workable environment. Indophil moved to dismiss, arguing that jurisdiction is with the
Labor Arbiter.
True, the maintenance of a safe and healthy workplace is ordinarily a subject of labor cases.
(owever, Adviento s claim for damages is specifically grounded on petitioner s gross
negligence to provide a safe, healthy and workable environment for its employees a case
of quasi-delict.
Clearly, injury and damages were allegedly suffered by respondent, an element of quasidelict. Secondly, the previous contract of employment between petitioner and respondent
cannot be used to counter the element of "no pre-existing contractual relation" since
petitioner s alleged gross negligence in maintaining a hazardous work environment cannot
be considered a mere breach of such contract of employment, but falls squarely within the
elements of quasi-delict under Article 2176 of the Civil Code since the negligence is direct,
substantive and independent.
NEDLLOYD LIJNEN B.V. ROTTERDAM and THE EAST ASIATIC CO., LTD. vs. GLOW LAKS
ENTERPRISES, LTD, G.R. No. 156330 , November 19, 2014, J. PEREZ
The respondent loaded to the vessel owned by the petitioner who is common carrier. By an
unfortunate turn of events, however, unauthorized persons managed to forge the covering
bills of lading and on the basis of the falsified documents, the ports authority releas ed the
goods.
In this case, there is no dispute that the custody of the goods was never turned over to the
consignee or his agents but was lost into the hands of unauthorized persons who secured
possession thereof on the strength of falsified documents. The loss or the misdelivery of the
goods in the instant case gave rise to the presumption that the common carrier is at fault or
negligent.
A common carrier is presumed to have been negligent if it fails to prove that it exercised
extraordinary vigilance over the goods it transported. When the goods shipped are either
lost or arrived in damaged condition, a presumption arises against the carrier of its failure
to observe that diligence, and there need not be an express finding of negligence to hold it
liable. To overcome the presumption of negligence, the common carrier must establish by
139
adequate proof that it exercised extraordinary diligence over the goods. It must do more
than merely show that some other party could be responsible for the damage. In the
present case, petitioners failed to prove that they did exercise the degree of diligence
required by law over the goods they transported.
Sanitary Steam Laundry, Inc. vs. Court of Appeals, 300 SCRA 20
The driver was in violation of the Land Transportation and Traffic Code when
its vehicle got involved in an accident that killed three persons. For the driver
to be found negligent petitioner must show that the violation of the statute was
the proximate or legal cause of the injury or that it substantially contribute d
thereto because such negligence, consisting in whole or in part, of violation of
law, like any other negligence is without legal consequence unless it is a
contributing cause of the injury.
Mckee vs. Intermediate Appellate Court, 211 SCRA 517
A head-on-collision took place between a cargo truck driver and a car driver
Jose Koh, which resulted in the death of Jose Koh and two others because the
Koh avoided hitting two boys who suddenly darted across the lane. Under the
Emergency Rule, Koh was not negligent because his entry into the lane of the
truck was necessary in order to avoid what was, in his mind at that time, a
greater peril of death or injury to the two boys. Under this rule, a person who,
without fault or negligence on his part, is suddenly placed in an emergency or
unexpected danger and compelled to act instantly and instinctively with no
time for reflection and exercise of the required precaution, is not guilty of
negligence and, therefore, exempt from liability, if he did not make the wisest
choice of the available courses of conduct to avoid injury which a reasonably
prudent person would have made under normal circumstances.
140
A young man by the name of Juan Diaz Astudillo met his death through
electrocution, when he placed his right hand on a wire connected with an
electric light pole owned by Meralco. Meralco was negligent in so placing the
pole and wires as to be within the proximity of a place frequented by many
persons, with the possibility of coming in contact with a highly charged and
defectively insulated wire.
Bernardo vs. Legaspi, 29 Phil. 12
Two automobiles, going in opposite directions, collide on turning a street
corner, and it appears from the evidence that the drivers were equally negligent
and contributed equally to the collision. Under the doctrine of contributory
negligence, neither can recover from the other for the damages suffered.
Negros Navigation Co., Inc. vs. Court of Appeals, 281 SCRA 534
The ship captain of MT Tacloban City, an oil tanker owned by PNOC, was
playing mah-jong when it collided off the Tablan Strait in Mindoro, with M,V
Don Juan owned by petitioner NENACO. The owner of the ship was found
equally negligent with the ship captain because of tolerating the playing of
mahjong by the ship captain and other crew members while on board the ship
and failing to keep the ship seaworthy.
Philippine Long Distance Telephone Co., Inc. vs. Court of Appeals, 178
SCRA 94
The jeepney of the respondents fell into an open excavation when the jeep
swerved from the inside lane of the street, respondents being aware of the
presence of said excavation. The negligence of respondent Antonio Esteban was
not only contributory to his injuries and those of his wife but goes to the very
cause of the occurrence of the accident, as one of its determining factors, and
thereby precludes their right to recover damages.
GROSS M ISCONDUCT
DR. IDOL L. BONDOC vs. MARILOU R. MANTALA, G.R. No. 203080, November 12, 2014,
J. Villarma, Jr.
A physician is guilty of gross misconduct when he chose to conduct a normal delivery and
deliberately left her patient to a midwife and two inexperienced assistants despite knowing
that the patient was under prolonged painful labor and about to give birth to a macrosomic
baby by vaginal delivery which resulted to a stillborn baby and the loss of her reproductive
capacity. A physician should be dedicated to provide competent medical care with f ull
professional skill in accordance with the current standards of care, compassion,
independence and respect for human dignity.
141
NOEL CASUMPANG, RUBY SANGA-MIRANDA AND SAN JUAN DE DIOS HOSPITAL, vs.
NELSON CORTEJO, G.R. No. 171127/DRA. RUBY SANGA-MIRANDA, v. NELSON
CORTEJO, G.R. No. 171217/SAN JUAN DE DIOS HOSPITAL, vs. NELSON CORTEJO, G.R.
No. 171228, March 11, 2015, J. Brion
Dr. Casumpang and Dr. Miranda are accused of negligence leading to the death of a young
boy. The SC held that, to successfully pursue a medical malpractice suit, the plaintiff (in this
case, the deceased patient's heir) must prove that the doctor either failed to do what a
reasonably prudent doctor would have done, or did what a reasonably prudent doctor
would not have done; and the act or omission had caused injury to the patient. The
patient's heir/s bears the burden of proving his/her cause of action. The elements of
medical negligence are: (1) duty; (2) breach; (3) injury; and (4) proximate causation. Given
these elements, only Dr. Casumpang, attending physician, was found to be negligent for
having failed to promptly detect dengue fever and undertake the proper medical
management needed for this disease.
Atty. Lacaya claims he had an arrangement with his client that he would be awarded one
half of the property acquired by his client if they obtained favorable judgment.
Article 1491 (5) of the Civil Code forbids lawyers from acquiring, by purchase or
assignment, the property that has been the subject of litigation in which they have taken
part by virtue of their profession. The same proscription is provided under Rule 10 of the
Canons of Professional Ethics.
A thing is in litigation if there is a contest or litigation over it in court or when it is subject
of the judicial action. Following this definition, SC held that the subject lot was still in
litigation when Atty. Lacaya acquired the disputed one-half portion. We note in this regard
the following established facts:(1)on September 21, 1981, Atty. Lacaya filed a motion for
the issuance of a writ of execution in Civil Case No. 1721; (2) on September 23, 1981, the
spouses Ames filed Civil Case No. 3352 against the spouses Cadavedo; (3)on October 16,
1981, the RTC granted the motion filed for the issuance of a writ of execution in Civil Case
No. 1721 and the spouses Cadavedo took possession of the subject lot on October 24, 1981;
(4) soon after, the subject lot was surveyed and subdivided into two equal portions, and
Atty. Lacaya took possession of one of the subdivided portions; and (5) on May 13, 1982,
Vicente and Atty. Lacaya executed the compromise agreement.
142
From these timelines, whether by virtue of the alleged oral contingent fee agr eement or an
agreement subsequently entered into, Atty. Lacaya acquired the disputed one -half portion
(which was after October 24, 1981) while Civil Case No. 3352 and the motion for the
issuance of a writ of execution in Civil Case No. 1721 were already pending before the
lower courts. Similarly, the compromise agreement, including the subsequent judicial
approval, was effected during the pendency of Civil Case No. 3352. In all of these, the
relationship of a lawyer and a client still existed between Atty. Lacaya and the spouses
Cadavedo.
Thus, whether we consider these them to be prohibited and void by reason of public policy.
Under Article 1409 of the Civil Code, contracts which are contrary to public policy and
those expressly prohibited or declared void by law are considered in existent and void
from the beginning.
While contingent fee agreements are indeed recognized in this jurisdiction as a valid
exception to the prohibitions under Article 1491(5) of the Civil Code, this recognition does
not apply to the present case. A contingent fee contract is an agreement in writing where
the fee, often a fixed percentage of what may be recovered in the action, is made to depend
upon the success of the litigation. The payment of the contingent fee is not made durin g the
pendency of the litigation involving the client s property but only after the judgment has
been rendered in the case handled by the lawyer.
In the present case, we reiterate that the transfer or assignment of the disputed one -half
portion to Atty. Lacaya took place while the subject lot was still under litigation and the
lawyer-client relationship still existed between him and the spouses Cadavedo. Thus, the
general prohibition provided under Article 1491 of the Civil Code, rather than the
exception provided in jurisprudence, applies.
The compromise agreement entered into between Vicente and Atty. Lacaya in Civil Case No.
ejectment case was intended to ratify and confirm Atty. Lacaya s acquisition and
possession of the disputed one-half portion which were made in violation of Article 1491
(5) of the Civil Code. As earlier discussed, such acquisition is void; the compromise
agreement, which had for its object a void transaction, should be void.
A contract whose cause, object or purpose is contrary to law, morals, good customs, public
order or public policy is in existent and void from the beginning. It can never be ratified nor
the action or defense for the declaration of the in existence of the contract prescribe; and
any contract directly resulting from such illegal contract is likewise void and in existent.
Consequently, the compromise agreement did not supersede the written contingent fee
agreement providing for attorney s fee of P2,000.00.
SC fixed the attorney s fees on a quantum meruit basis.The doctrine of quantum meruit is a
device to prevent undue enrichment based on the equitable postulate that it is unjust for a
person to retain benefit without paying for it.
143
Medical malpractice or, more appropriately, medical negligence, is that type of claim which
a victim has available to him or her to redress a wrong committed by a medical
professional which has caused bodily harm. In order to successfully pursue such a claim, a
patient, or his or her family as in this case, "must prove that a health care provider, in most
cases a physician, either failed to do something which a reasonably prudent health care
provider would have done, or that he or she did something that a reasonably prudent
provider would not have done; and that failure or action caused injury to the patient.
As the Court held in Spouses Flores v. Spouses Pineda, et al. ,the critical and clinching factor
in a medical negligence case is proof of the causal connection between the negligence and
the injuries. The claimant must prove not only the injury but also the defendant's fault, and
that such fault caused the injury. A verdict in a malpractice action cannot be based on
speculation or conjecture. Causation must be proven within a reasonable medical
probability based upon competent expert testimony, which the Court finds absent in the
case at bar. As regards the respondents' counterclaim, the CA's award of P48,515.58 is
sustained.
Ramos vs. Court of Appeals, 321 SCRA 584
At the time of her admission, patient Erlinda Ramos was neurologically sound
but during the administration of anesthesia and prior to the performance of a
gall bladder operation, she suffered irreparable damage to her brain and was
diaganosed to be suffering from diffuse cerebral parenchymal damage. The
damage sustained by Erlinda Erlinda in her brain prior to a scheduled gall
bladder operation presents a case for the application of res ipsa loquitur in
medical malpractice as it was found out that brain damage does not normally
occur in the process of gall bladder operations, and does not happen in the
absence of negligence of someone in the administration of anesthesia and in
the use of endotracheal tube.
her uterus, it stands to reason that such could only have been a by-product of
the caesarean section performed by Dr. Batiquin.
Lawyers
Roque vs. Gunigundo, 89 SCRA 178
Atty. Gunigundo was charged by his client Roque with G.R.oss negligence in
not seasonably filing their motion for reconsideration and in not perfecting an
appeal from the trial courts order of dismissal. Atty. Gunigundo's filing of
motions for extension on the last day and sending them by registered mail
(thus giving the court insufficient time to act before the extension sought had
expired) and his omission to verify whether his second motion for extension
was granted are indicative of lack of competence, diligence and fidelity in the
dispatch of his clients business.
Adarne vs. Aldaba, 83 SCRA 734
Adarne was declared in default for failure to appear in the hearing because his
one of his lawyers honestly believed that he had appeared for the complainant
only for a special purpose and that the complainant had agreed to contact his
attorney of record to handle his case after the hearing of October 23, 1964, so
that he did nothing more about it. An attorney is not bound to exercise
extraordinary diligence, but only a reasonable degree of care and skill having
reference to the character of the business he undertakes to do.
STRICT LIABILITY
Vestil vs. Intermediate Appellate Court, 179 SCRA 47
Theness, a three-year old child, was killed after she was bitten by a dog while
she was playing with the child of Purita Vestil in the house of Vicente Miranda,
the late father of Purita. Spouses Vestils contention that they cannot be
faulted as they are not the owner of the house where the child was bitten
cannot be accepted because under the Article 2183 of the Civil Code the
possessor of animal is liable even if the animal should escape or be lost and
so be removed from his control.
Amadora vs. Court of Appeals, 160 SCRA 315
Amadora was shot dead by his classmate Daffon inside the school auditorium,
when the classes had formally ended. As long as it can be shown that the
student is in the school premises in pursuance of a legitimate student
objective, in the exercise of a legitimate student right, and even in the
enjoyment of a legitimate student privilege, the responsibility of the school
authorities over the student continues.
145
received by the carrier for transportation until the same are delivered, actually or
constructively, by the carrier to the consignee, or to the person who has a right to receive
them. Owing to this high degree of diligence required of them, common carriers, as a
general rule, are presumed to have been at fault or negligent if the goods they transported
deteriorated or got lost or destroyed. That is, unless they prove that they exercised
extraordinary diligence in transporting the goods. In order to avoid responsibility for any
loss or damage, therefore, they have the burden of proving that they observed such high
level of diligence. In this case, petitioner failed to hurdle such burden.
RES IPSA LOQUITUR
VICENTE JOSEFA vs. MANILA ELECTRICCOMPANY, G.R. No. 182705, July 18, 2014,
J.Brion
For the doctrine of res ipsa loquitur to apply, the complainant must show that: (1) the
accident is of such character as to warrant an inference that it would not have happened
except for the defendant s negligence (2) the accident must have been caused by an agency
or instrumentality within the exclusive management or control of the person charged with
the negligence complained of and
the accident must not have been due to any
voluntary action or contribution on the part of the person injured. The present case
satisfies all the elements of res ipsa loquitur.
UNKNOWN OWNER OF THE VESSEL M/V CHINA JOY, SAMSUN SHIPPING LTD., AND
INTER-ASIA MARINE TRANSPORT, INC. v. ASIAN TERMINALS, INC, G.R. No. 195661.
March 11, 2015, J. REYES
The three requisites to the application of the doctrine of res ipsa loquitur are found to be
attendant in the case at bar. First, the co-mingling of the two foreign metal objects with the
soybean meal cargo and the consequent damage to AT) s unloader is an accident which
ordinarily does not occur in the absence of someone s negligence. Second, the foreign metal
objects were found in the vessel s (old No. , which is within the exclusive control of the
petitioners. Third, records do not show that AT) s negligence had in any way contributed to
the damage caused to its unloader. All 3 requisites of res ipsa loquitur being present, the
presumption or inference arises that defendants negligence was the proximate cause of
the damage to AT) s unloader. The burden of evidence shifted to defendants to prove
otherwise. The defendants failed to do so.
INTERNATIONAL CONTAINER TERMINAL SERVICES INC. VS. CELESTE M. CHUA, G.R.
No. 195031March 26, 2014, J. PEREZ
The container van loaded with the personal effects of respondent Chua arrived at North
Harbor, Manila and was unloaded in the depot belonging to petitioner for safekeeping
pending the customs inspection. The container van was stripped and partially inspected by
custom authorities. Further inspection thereof was scheduled on May 8, 1997. However, on
147
the date scheduled, petitioner s depot was gutted by fire and respondent s container van
was burned.
Under the circumstances of this case, petitioner is liable to respondent for damages on
account of the loss of the contents of her container van. Petitioner itself admitted during
the pretrial of this case that respondent s container van caught fire while stored within its
premises. Absent any justifiable explanation on the part of petitioner on the cause of the
fire as would absolve it from liability, the presumption that there was negligence on its part
comes into play. The situation in this case, therefore, calls for the application of the
doctrine of res ipsa loquitur.
The doctrine is based on the theory that the defendant either knows the cause of the
accident or has the best opportunity of ascertaining it and the plaintiff, having no
knowledge thereof, is compelled to allege negligence in general terms. In such instance, the
plaintiff relies on proof of the happening of the accident alone to establish negligence. The
principle, furthermore, provides a means by which a plaintiff can hold liable a defendant
who, if innocent, should be able to prove that he exercised due care to prevent the acc ident
complained of from happening. )t is, consequently, the defendant s responsibility to show
that there was no negligence on his part. The doctrine, however, can be invoked when and
only when, under the circumstances involved, direct evidence is absent and not readily
available. Here, there was no evidence as to how or why the fire in the container yard of
petitioner started; hence, it was up to petitioner to satisfactorily prove that it exercised the
diligence required to prevent the fire from happening. This it failed to do. Thus, the trial
court and the Court of Appeals acted appropriately in applying the principle of res ipsa
loquitur to the case at bar.
VICENTE JOSEFA v MANILA ELECTRIC COMPANY, G.R No. 182705, July 18, 2014. J.
BRION
Res ipsa loquitor is the doctrine which postulates that, as a matter of common knowledge
and experience and in the absence of some explanation by the defendant who is charged
with negligence, the very nature of occurrences may justify an inference of negligence on
the part of the person who controls the instrumentality causing the injury.
In this case, the driver Bautista is presumed to be negligent in driving the truck under the
res ipsa loquitor doctrine. The present case satisfies all the elements of res ipsa loquitur. It
is very unusual and extraordinary for the truck to hit an electricity post, an immovable and
stationary object, unless Bautista, who had the exclusive management and control of the
truck, acted with fault or negligence.
DAM AGES
148
NEW WORLD DEVELOPERS AND MANAGEMENT INC. vs. AMA COMPUTER LEARNING
CENTER INC., G.R. Nos. 187930 & 188250, February 23, 2015, C.J. Sereno
Pretermination is effectively the breach of a contract, that was originally intended to cover
an agreed upon period of time. A definite period assures the lessor a steady income for the
duration. A pretermination would suddenly cut short what would otherwise have been a
longer profitable relationship. Along the way, the lessor is bound to incur losses until it is
able to find a new lessee, and it is this loss of income that is sought to be compensated by
the payment of liquidated damages. Also proper is an award of exemplary damages since
pursuant to Article 2234, petitioner was able to prove he was entitled moral, temperate or
compensatory damages were it not for the stipulation of liquidated damages.
MERALCO vs. RAM OY, G.R. NO. 158911, M arch 4, 2008
In the present case, MERALCO wilfully caused injury to Leoncio Ramoy by
withholding from him and his tenants the supply of electricity to which they
were entitled under the Service Contract. MERALCO's failure to exercise
utmost care and diligence in the performance of its obligation to its customer,
is tantamount to bad faith hence is entitled to moral damages.
MINDANAO TERM INAL AND BROKERAGE SERVICE, INC. vs. PHOENIX
ASSURANCE COMPANY OF NEW YORK,MCGEE & CO., INC., G.R. NO.
162467, M ay 8, 2009
The Court ruled that Mindanao Terminal had duly exercised the required
degree of diligence in loading and stowing the cargoes, which is the ordinary
diligence of a good father of a family. There is no basis for the award of
attorneys fees in favor of petitioner since none of the circumstances
enumerated in Article 2208 of the Civil Code exists because the present case is
clearly not an unfounded civil action against the plaintiff as there is no
showing that it was instituted for the mere purpose of vexation or injury.
AIR FRANCE vs.CARRASCOSO, G.R. NO. L-21438, September 28, 1966
Plaintiff was forced out of his seat in the first class compartment of the plane
belonging to the defendant Air France while at Bangkok, and was transferred to
the tourist class without his consent and against his will. The contract of air
carriage, therefore, generates a relation attended with a public duty, and
neglect or malfeasance of the carrier's employees, naturally, could give ground
for an action for damages.
149
BAYANI vs. PANAY ELECTRIC CO., INC., G.R. NO. 139680, April 12, 2000
The requisites for an action for damages based on malicious prosecution are:
(1) the fact of the prosecution and the further fact that the defendant was
himself the prosecutor, and that the action was finally terminated with an
acquittal;
(2) that in bringing the action, the prosecutor acted without probable cause;
and
(3) the prosecutor was actuated or impelled by legal malice.
WASSMER vs VELEZ, G.R. NO. L-20089, December 26, 1964
Two days before the wedding, defendant, who was then 28 years old, simply left
a note for plaintiff stating: "Will have to postpone wedding My mother
opposes it ... ", then enplaned to his home city in Mindanao, and never
returned and was never heard from again. This is not a case of mere breach of
promise to marry but unjustifiably contrary to good customs for which
defendant must be held answerable in damages in accordance with Article 21
aforesaid and per express provision of Article 2219 (10) of the New Civil Code,
moral damages are recoverable in the cases mentioned in Article 21 of said
Code.
legal basis. The banking industry is impressed with public interest. As such, the highest
degree of diligence is expected, and high standards of integrity and performance are even
required of it. It must therefore treat the accounts of its depositors with meticulous care
and always to have in mind the fiduciary nature of its relationship with them.
SEVEN BROTHERS SHIPPING CORPORATION vs. DMC-CONSTRUCTION RESOURCES,
INC., G.R. No. 193914. November 26, 2014, C.J. Sereno
Petitioner questions the decision of the CA awarding respondent nominal damages after
having ruled that the actual damages awarded by the RTC was unfounded. Petitioner
argues that nominal damages are only awarded to vindicate a right that has been violated
and not to indemnify a party for any loss suffered by the latter. The SC r uled that what
should have been awarded was temperate and not nominal damages. Temperate or
moderate damages may be recovered when the court finds that some pecuniary loss has
been suffered but its amount cannot, from the nature of the case, be provided with
certainty. Considering that it has been established that respondent suffered a loss, even if
the amount thereof cannot be proven with certainty, the Court ruled that what should have
been awarded was temperate damages.
PEOPLE OF THE PHILIPPINES vs. SHIRLEY A. CASIO, G.R. No. 211465, December 3,
2014, J. Leonen
The payment of P500,000 as moral damages and P100,000 as exemplary damages for the
crime of Trafficking in Persons as a Prostitute finds basis in Article 2219 of the Civil Code,
which provides that Moral and Exemplary Damages may be awarded in cases of seduction,
abduction, rape, or other lascivious acts. The criminal case of Trafficking in Persons as a
Prostitute is an analogous case to the crimes of seduction, abduction, rape, or other
lascivious acts. To be trafficked as a prostitute without one s consent and to be sexually
violated four to five times a day by different strangers is horrendous and atrocious. There
is no doubt that Lolita experienced physical suffering, mental anguish, fright, ser ious
anxiety, besmirched reputation, wounded feelings, moral shock, and social humiliation
when she was trafficked as a prostitute in Malaysia. Since the crime of Trafficking in
Persons was aggravated, being committed by a syndicate, the award of exemplary damages
is likewise justified.
TELEFAST COMMUNICATIONS vs. CASTRO, G.R. NO. 73867, February 29,
1988
Petitioner and private respondent entered into a contract whereby, for a fee,
petitioner undertook to send said private respondent's message overseas by
teleG.R.am but which petitioner did not do, despite performance by said private
respondent of her obligation by paying the required charges. The award of
151
152
LITO CORPUZ vs. PEOPLE OF THE PHILIPPINES, G.R. No. 180016 April 29, 2014, J.
PERALTA
In our jurisdiction, civil indemnity is awarded to the offended party as a kind of monetary
restitution or compensation to the victim for the damage or infraction that was done to the
latter by the accused, which in a sense only covers the civil aspect. Precisely, it is civil
indemnity. Thus, in a crime where a person dies, in addition to the penalty of imprisonment
imposed to the offender, the accused is also ordered to pay the victim a sum of money as
restitution. Clearly, this award of civil indemnity due to the death of the victim could not be
contemplated as akin to the value of a thing that is unlawfully taken which is the basis in
the imposition of the proper penalty in certain crimes. Thus, the reasoning in increasing the
value of civil indemnity awarded in some offense cannot be the same reasoning that would
sustain the adoption of the suggested ratio. Also, it is apparent from Article 2206 that the
law only imposes a minimum amount for awards of civil indemnity, which is P3,000.00.
The law did not provide for a ceiling. Thus, although the minimum amount for the award
cannot be changed, increasing the amount awarded as civil indemnity can be validly
modified and increased when the present circumstance warrants it. Corollarily, moral
damages under Article 2220of the Civil Code also does not fix the amount of damages that
can be awarded. It is discretionary upon the court, depending on the mental anguish or the
suffering of the private offended party. The amount of moral damages can, in relation to
civil indemnity, be adjusted so long as it does not exceed the award of civil indemnity.
SNOW MOUNTAIN DAIRY CORPORATION vs. GMA VETERANS FORCE, INC., G.R. No.
192446, November 19, 2014, J. Peralta
Actual or compensatory damages are those awarded in satisfaction of, or in recompense
for, loss or injury sustained. The burden is to establish one's case by a preponderance of
evidence which means that the evidence, as a whole, adduced by one side, is sup erior to
that of the other. Actual damages are not presumed. In this case, GMA Veterans had not
shown that the security guards were not assigned to another employer, and that it was
compelled to pay the guards despite the pre-termination of the security agreement to be
entitled to the amount of PI6,014.00 per month. Indeed, no evidence was presented by
GMA Veterans establishing the actual amount of loss suffered by reason of the pre termination. It is elementary that to recover damages, there must be pleading and proof of
actual damages suffered. Temperate damages may be allowed in cases where from the
nature of the case, definite proof of pecuniary loss cannot be adduced, although the court is
convinced that the aggrieved party suffered some pecuniary loss. The SC also take into
consideration that GMA Veterans certainly spent for the security guard's training, firearms
with ammunitions, uniforms and other necessary things before their deployment to Snow
Mountain. Hence, the SC find it just and proper to award temperate damages in the amount
of P200,000.00 in lieu of actual damages.
153
154
The award of damages to Spouses Rabaja cannot be sustained by this Court. The filing alone
of a civil action should not be a ground for an award of moral damages in the same way that
a clearly unfounded civil action is not among the grounds for moral damages. Article 2220
of the New Civil Code provides that to award moral damages in a breach of contract, the
defendant must act fraudulently or in bad faith. In this case, Spouses Rabaja failed to
sufficiently show that Spouses Salvador acted in a fraudulent manner or with bad faith
when it breached the contract of sale. Thus, the award of moral damages cannot be
warranted.
NANCY S. MONTINOLA v PHILIPPINE AIRLINES. G.R No. 198656, September 8, 2014.
LEONEN
Illegally suspended employees, similar to illegally dismissed employees, are entitled to
moral damages when their suspension was attended by bad faith or fraud, oppressive to
labor, or done in a manner contrary to morals, good customs, or public policy.
In this case, a PAL employee was suspended for one year. In upholding the award of moral
damages, the Court said that PAL s act was contrary to morals, good customs, and public
policy. PAL was willing to deprive Montinola of the wages she would have earned during
155
her year of suspension even if there was no substantial evidence that she was involved in
the pilferage.
BPI EXPRESS CARD CORPORATION vs. MA. ANTONIA R. ARMOVIT, G.R. No. 163654,
October 8, 2014, J. Bersamin
The relationship between the credit card issuer and the credit card holder is a contractual
one that is governed by the terms and conditions found in the card membership agreement.
Such terms and conditions constitute the law between the parties. In case of their breach,
moral damages may be recovered where the defendant is shown to have acted fraudulently
or in bad faith. Malice or bad faith implies a conscious and intentional design to do a
wrongful act for a dishonest purpose or moral obliquity. However, a conscious or
intentional design need not always be present because negligence may occasionally be so
gross as to amount to malice or bad faith. Hence, bad faith in the context of Article 2220 of
the Civil Code includes gross negligence. Nowhere in the terms and conditions requires the
defendant to submit new application form in order to reactivate her credit card. Indeed,
BPI Express Credit did not observe the prudence expected of banks whose business was
imbued with public interest, hence, defendant is entitled to damages.
JOSE ESPINELI a.k.a. DANILO ESPINELI vs. PEOPLE OF THE PHILIPPINES, G.R. No.
179535, June 9, 2014, J. Del Castillo
Moral damages are mandatory without need of allegation and proof other than the death of
the victim, owing to the fact of the commission of murder or homicide, such as when the
victim was gunned down in front of his house. If medical and funeral expenses were
substantiated, actual damages may be awarded. However, damages for loss of earning
capacity may not be awarded absent documentary evidence except where the victim was
either self-employed or a daily wage worker earning less than the minimum wage under
current labor laws. The testimony of the wife of the victim, a Senior Desk Coordinator of a
radio station, as to the latter s monthly salary without any documentary evidence will not
suffice to substantiate the claim.
BPI vs CA, G.R. NO. 136202, January 25, 2007
The bank froze and later unilaterally debited an amount from the account of
A.A. Salazar Construction and Engineering Services without informing her that
it had already done so, which caused plaintiff-appellee great damage and
prejudice particularly when she had already issued checks drawn against the
said account and as can be expected, the said checks bounced, thereby
causing private respondent Salazar undue embarrassment and inflicting
damage to her standing in the business community.
156
A depositor has the right to recover reasonable moral damages even if the
banks negligence may not have been attended with malice and bad faith, if the
former suffered mental anguish, serious anxiety, embarrassment and
humiliation.
VILLA REY TRANSIT, INC., vs. THE COURT OF APPEALS, G.R. NO. L25499 February 18, 1970
The trial court and the Court of Appeals, both found that the accident and the
death of Policronio had been due to the negligence of the bus driver, for whom
petitioner was liable under its contract of carriage with the deceased but the
only issue raised in this appeal is the amount of damages recoverable by
private respondents herein. The determination of the indemnity to be awarded
to the heirs of a deceased person has therefore no fixed basis and much is left
to the discretion of the court considering the moral and material damages
involved, and so it has been said that "(t)here can be no exact or uniform rule
for measuring the value of a human life and the measure of damages cannot be
arrived at by precise mathematical calculation, but the amount recoverable
depends on the particular facts and circumstances of each case.
PEOPLE vs. EBAROLA, G.R. NO. L-69666, January 23, 1992
Appellant had been convicted of homicide and the trial court awarded the
amount of P100,000.00 to the heirs of Manahan as indemnity for death. The
indemnity for death must be reduced to P50,000.00 conformably with
prevailing jurisprudence on the matter and aside from the ordinary indemnity
for death appellant is obliged: (1) to compensate the heirs for the latter's loss of
earning capacity; (2) to give support in the form of expenses for education to
dependents of the deceased and (3) to pay the heirs for moral damages for the
mental anguish suffered by them.
COJUANGCO vs. COURT OF APPEALS, G.R. NO. 119398. July 2, 1999
To hold public officers personally liable for moral and exemplary damages and
for attorneys fees for acts done in the performance of official functions, the
plaintiff must prove that these officers exhibited acts characterized by evident
bad faith, malice, or gross negligence, but even if their acts had not been so
tainted, public officers may still be held liable for nominal damages if they had
violated the plaintiffs constitutional rights.
TEMPERATE DAMAGES
157
S.V. MORE PHARMA CORPORATION and ALBERTO A. SANTILLANA vs. DRUGMAKERS LABO
RA TORIES, INC. and ELIEZER DEL MUNDO; S.V. MORE PHARMA CORPORATION and ALBERTO
A. SANTILLANA vs. DRUGMAKERS LABO RA TORIES, INC. and ELIEZER DEL MUNDO, G.R. No.
200408; G.R. No. 200416, November 12, 2014, J. Perlas- Bernabe
The existence of contractual breach in this case revolves around the exclusive status of Drugmakers
as the manufacturer of the subject pharmaceutical products. In particular, the Contract
Manufacturing Agreement states that Drugmakers, being the exclusive manufacturer of the subject
pharmaceutical products, had to first give its written consent before S.V. More could contract the
services of another manufacturer. The agreements notwithstanding, S.V More, through the CMPP
and absent the prior written consent of Drugmakers, contracted the services of Hizon Laboratories
to manufacture some of the pharmaceutical products covered by the said contracts. Considering
that Drugmakers palpably suffered some form of pecuniary loss resulting from S.V. More s breach of
contract, the Court deems it proper to, instead, award in their favor the sum of P100,000.00 in the
form of temperate damages. This course of action is hinged on Article 2224 of the Civil Code.
158
LIBCAP MARKETING v BAQUIAL, G.R No. 192011, June 30, 2014. DEL CASTILLO
Unpaid overtime pay should not be included in the computation for the award of nominal
damages. The Court did not agree with the CA s finding that since respondent rendered
overtime work for four years without receiving any overtime pay, she is entitled to
P100,000.00 nominal damages. Nominal damages are awarded for the purpose of
vindicating or recognizing a right and not for indemnifying a loss. Hence, the CA should
have limited the justification of the award of nominal damages to petitioners violation o f
respondent s right to due process in effecting her termination. )t should not have
considered the claimed unpaid overtime pay.
AREOLA vs. COURT OF APPEALS, G.R. NO. 95641 September 22, 1994
Nominal damages are "recoverable where a legal right is technically violated
and must be vindicated against an invasion that has produced no actual
present loss of any kind, or where there has been a breach of contract and no
substantial injury or actual damages whatsoe ver have been or can be shown.
ATTORNEYS FEES
AUGUSTO M. AQUINO, vs. HON. ISMAEL P. CASABAR, as Presiding Judge Regional Trial
Court-Guimba, Nueva Ecija, Branch 33 and MA. ALA F. DOMINGO and MARGARITA
IRENE F. DOMINGO, substituting Heirs of the deceased ANGEL T. DOMINGO, G.R. No.
191470, January 26, 2015, J. Peralta
159
The award that the court may grant to a successful party by way of attorney s fee is an
indemnity for damages sustained by him in prosecuting or defending his cause in court. It
may be decreed in favor of the party, not his lawyer, in any of the instances authorized by
law. On the other hand, the attorney s fee which a client pays his counsel refers to the
compensation for the latter s services. The losing party against whom damages by way of
attorney s fees may be assessed is not bound by, nor is his liability dependent upon, the fee
arrangement of the prevailing party with his lawyer. The amount stipulated in such fee
arrangement may, however, be taken into account by the court in fixing the amount of
counsel fees as an element of damages. The fee as an item of damages belongs to the party
litigant and not to his lawyer. It forms part of his judgment recoveries against the losing
party. The client and his lawyer may, however, agree that whatever attorney s fee as an
element of damages the court may award shall pertain to the lawyer as his compensation
or as part thereof.
ALEJANDRO C. ALMENDRAS, JR. vs. ALEXIS C. ALMENDRAS, G.R. No. 179491, January
14, 2015, C.J. Sereno
The award of attorney's fees is not proper because respondent failed to justify satisfactorily
his claim, and both the trial and appellate courts failed to explicitly state in their respective
decisions the rationale for the award. It is an accepted doctrine that the award thereof as an
item of damages is the exception rather than the rule, and counsel's fees are not to be
awarded every time a party wins a suit. The power of the court to award attorney's fees
under Article 2208 of the Civil Code demands factual, legal and equitable justification,
without which the award is a conclusion without a premise, its basis being improperly left
to speculation and conjecture. In all events, the court must explicitly state in the text of the
decision, and not only in the decretal portion thereof, the legal reason for the award of
attorney's fees. The same is true for the award of litigation expenses because respondent
failed to satisfactorily justify his claim.
RICARDO C. HONRADO vs. GMA NETWORK FILMS, INC. G.R. No. 204702. January 14,
2015, CARPIO
The trial court awarded attorney's fees to petitioner as it "deemed it just and reasonable"
to do so, using the amount provided by petitioner on the witness stand. Undoubtedly,
attorney's fees may be awarded if the trial court "deems it just and equitable." Such ground,
however, must be fully elaborated in the body of the ruling. Its mere invocation, without
more, negate the nature of attorney's fees as a form of actual damages.
JUAN CABRERA VS. HENRY YSAAC, G.R. No. 166790. November 19, 2014, J. LEONEN
Petitioner is not entitled to attorney's fees and the costs of litigation since he did not have a
clear right over the property in question. The Court of Appeals awarded attorney's fees and
litigation costs on the erroneous premise that the contract between petitioner and
respondent was perfected. Without a valid contract that stipulates his rights, petitioner
risked litigation in order to determine if he has rights, and not to protect rights that he
160
currently has. Hence, the award of attorney's fees and litigation costs was not properly
justified.
BANK OF THE PHILIPPINE ISLANDS VS, AMADOR DOMINGO (DECEASED)
SUBSTITUTED BU HIS CHILDREN, JOANN MOYA, ET AL. G.R. No. 169407. March 25,
2015, J. LEONARDO-DE CASTRO
It is basic that the claim for actual, moral and punitive damages as well as exemplary
damages and attorney s fees must each be independently identified and justified.
ALEJANDRO C. ALMENDRAS, JR. vs. ALEXIS C. ALMENDRAS, G.R. No. 179491, January
14, 2015, C.J. Sereno
In awarding damages in libel cases, the court is given ample discretion to determine the
amount, depending upon the facts of the particular case. Article 2219 of the Civil Code
expressly authorizes the recovery of moral damages in cases of libel, slander or any other
form of defamation. (owever, while no proof of pecuniary loss is necessary in order that
moral damages may be awarded, x x x it is nevertheless essential that the claimant should
satisfactorily show the existence of the factual basis of damages and its causal connection
to defendant s acts. Considering that respondent sufficiently justified his claim for
damages (i.e. he testified that he was embarrassed by the said letters [and] ashamed to
show his face in [sic] government offices , the Court finds him entitled to moral and
exemplary damages. However, the Court equitably reduce the amounts awarded because
even though the letters were libellous, respondent has not suffered such grave or
substantial damage to his reputation to warrant receiving P5,000,000 as moral damages
and P100,000.00 as exemplary damages.
As to the award of attorney s fees, it is an accepted doctrine that the award thereof as an
item of damages is the exception rather than the rule, and counsel s fees are not to be
awarded every time a party wins a suit. The power of the court to award attorney s fees
under Article 2208 of the Civil Code demands factual, legal and equitable justification,
without which the award is a conclusion without a premise, its basis being improperly left
to speculation and conjecture. In all events, the court must explicitly state in the text of the
decision, and not only in the decretal portion thereof, the legal reason for the award of
attorney s fees.
RICARDO C. HONRADO vs. GMA NETWORK FILMS, INC., G.R. No. 204702, January 14,
2015, J. Carpio
In a licensing contract, the essence of which is the transfer by the licensor, Honrado to the
licensee, GMA Films, for a fee, of the exclusive right to telecast the films listed in the
Agreement. Stipulations for payment of commission to the licensor is incongruous to the
nature of such contracts unless the licensor merely acted as agent of the film owners.
Nowhere in the Agreement, however, did the parties stipulate that Honrado signed the
161
contract in such capacity. Being a stranger to such arrangements, they are not entitled to
complain of any breach by Honrado of his contracts with the film owners than the film
owners are for any breach by a stranger of its Agreement with aforementioned. The trial
court awarded attorney s fees to (onrado as it deemed it just and reasonable to do so,
using the amount provided by Honrado on the witness stand (P100,000). Undoubtedly,
attorney s fees may be awarded if the trial court deems it just and equitable. Such ground,
however, must be fully elaborated in the body of the ruling. Its mere invocation, without
more, negates the nature of attorney s fees as a form of actual damages.
INTEREST/COMPUTATION
162
PEOPLE OF THE PHILIPPINES vs. BENJAMIN CASAS Y VINTULAN, G.R. No. 212565,
February 25, 2015, J. Perlas-Bernabe
The formula for the computation of loss of earning capacity is as follows:
Net earning capacity = Life Expectancy x [Gross Annual Income - Living Expenses (50% of
gross annual income)], where life expectancy = 2/3 (80 - the age of the deceased).
CIVIL LIABILITY
ANTONIO M. GARCIA vs. FERRO CHEMICALS, INC.,G.R. No. 172505, October 01, 2014, J.
Leonen
Ferro Chemicals, Inc. joined the public prosecutor in filing the petition for certiorari before
this court. Ramon Garcia, President of Ferro Chemicals, Inc., signed the verification and
certification of non-forum shopping of the petition for certiorari. When the civil action for
the recovery of civil liability ex delicto is instituted with the criminal action, whether by
choice of private complainant (i.e., no reservation is made or no prior filing of a separate
civil action) or as required by the law or rules, the case will be prosecuted under the
direction and control of the public prosecutor. The civil action cannot proceed
independently of the criminal case.
OTHER LAWS EXCLUDED FROM THE SYLLABUS
EUFROCINA NIEVES vs. ERNESTO DULDULAO and FELIPE PAJARILLO, G.R. No.
190276, April 2, 2014, J. Perlas-Bernabe
Agricultural lessees, being entitled to security of tenure, may be ejected from their
landholding only on the grounds provided by law. These grounds the existence of which
is to be proven by the agricultural lessor in a particular case are enumerated in Section
of Republic Act No. RA
, otherwise known as the Agricultural Land Reform
Code. )n this case, it was established that the agricultural lessees willfully and deliberately
failed to pay the lease rentals when they fell due, which is one o f the grounds for
dispossession of their landholding as provided in said provision of law.
CHARLES BUMAGAT, et al. vs. REGALADO ARRIBAY, G.R. No. 194818, June 9, 2014, J.
Del Castillo
A case involving agricultural land does not immediately qualify it as an agrarian dispute.
The mere fact that the land is agricultural does not ipso facto make the possessor an
agricultural lessee or tenant; there are conditions or requisites before he can qualify as an
agricultural lessee or tenant, and the subject matter being agricultural land constitutes
simply one condition. In order to qualify as an agrarian dispute, there must likewise exist a
tenancy relation between the parties. Thus, when farmer-beneficiaries of PD 27 who are
registered owners of agricultural lands filed a complaint for forcible entry against a person
163
whose claim of ownership over the same parcels of land emanates from a donation by the
heirs of the original owner, it is a civil case within the jurisdiction of the ordinary courts, as
all the elements for an agrarian dispute are not present.
MARIANO JOSE, FELICISIMO JOSE, DECEASED, SUBSTITUTED BY HIS CHILDREN
MARIANO JOSE, CAMILO JOSE, TIBURCIA JOSE, FERMINA JOSE, AND VICTORIA JOSE vs.
ERNESTO M. NOVIDA, RODOLFO PALAYPAY, JR., ALEX M. BELARMINO, RODRIGO
LIBED, LEONARDO L. LIBED, BERNARDO B. BELARMINO, BENJAMIN G. ACOSTA,
MODESTO A. ORLANDA, WARLITO B. MEJIA, MAMERTO B. BELARMINO, MARCELO O.
DELFIN AND HEIRS OF LUCINO A. ESTEBAN, REPRESENTED BY CRESENCIA M. VDA.
ESTEBAN, G.R. No. 177374, July 2, 2014, J. Del Castillo
In Heirs of Lazaro Gallardo vs. Soliman, the DARAB has exclusive jurisdiction over cases
involving the cancellation of registered EPs; the DAR Secretary, on the other hand, has
exclusive jurisdiction over the issuance, recall or cancellation of EPs or Certificates of Land
Ownership Awards that are not yet registered with the Register of Deeds.
Thus, since certificates of title have been issued in the respective names of the respondents
as early as in 1990, the DAR Region I Director had no jurisdiction to cancel their titles; the
same is true with respect to the DAR Secretary. Thus, their respective January 30, 1991 and
August
,
Orders are null and void; consequently, respondents EPs and titles
subsists, contrary to petitioner s claim that they have been cancelled. Void judgments or
orders have no legal and binding effect, force or efficacy for any purpose; in contemplation
of law, they are nonexistent.
LAND BANK OF THE PHILIPPINES vs. JOSE T. LAJOM, represented by PORFIRIO
RODRIGUEZ et al., G.R. No. 184982 & 185048, August 20, 2014, J. Perlas-Bernabe
Properties of the Lajoms were taken due to the Agrarian Reform Program. Just
compensation was partially given. The Lajoms contested the computation of just
compensation due to an alleged error in the applicable law. The Court ruled that the date of
taking of the subject land for purposes of computing just compensation should be reckoned
from the issuance dates of the emancipation patents. An emancipation patent constitutes
the conclusive authority for the issuance of a Transfer Certificate of Title in the n ame of the
grantee. It is from the issuance of an emancipation patent that the grantee can acquire the
vested right of ownership in the landholding, subject to the payment of just compensation
to the landowner.
RENATO L. DELFINO, SR. (Deceased), Represented by his Heirs, namely: GRACIA
DELFINO, GREGORIO A. DELFINO; MA. ISABEL A. DELFINO, RENATO A. DELFINO, JR.,
MA. REGINA DELFINO ROSELLA, MA. GRACIA A. DELFINO, MARIANO A. DELFINO, MA.
LUISA DELFINO GREGORIO and REV. FR. GABRIELA. DELFINO vs. AVELINO K. ANASAO
and ANGEL K. ANASAO (Deceased and represented by his sole heir, SIXTO C.
ANASAO), G.R. No. 197486, September 10, 2014, J. Villarama, Jr.
164
The right to choose the area to be retained, which shall be compact or contiguous, shall
pertain to the landowner; Provided, however, That in case the area selected for retention
by the landowner is tenanted, the tenant shall have the option to choose whether to remain
therein or be a beneficiary in the same or another agricultural land with similar or
comparable features. In case the tenant chooses to remain in the retained area, he shall be
considered a leaseholder and shall lose his right to be a beneficiary under this Act. In case
the tenant chooses to be a beneficiary in another agricultural land, he loses his right as a
leaseholder to the land retained by the landowner. The tenant must exercise this option
within a period of one (1) year from the time the landowner manifests his choice of the
area for retention.
AUTOMAT REALTY AND DEVELOPMENT CORPORATION, LITO CECILIA AND LEONOR
LIM vs. SPOUSES MARCIANO DELA CRUZ, SR. AND OFELIA DELA CRUZ, G.R. No.
192026, October 01, 2014, J. Leonen
When Automat asked the spouses to vacate the premises, the spouses refused to vacate
unless they were paid compensation. They claimed they were agricultural tenants [who]
enjoyed security of tenure under the law. The Court ruled that tenancy relationship cannot
be presumed. The allegation of its existence must be proven by evidence, and working on
another s landholding raises no presumption of an agricultural tenancy. Consequently, the
landowner s consent to an agricultural tenancy relationship must be shown.
REMIGIO D. ESPIRITU and NOEL AGUSTIN vs. LUTGARDA TORRES DEL ROSARIO
represented by SYLVIA R. ASPERILLA, G.R. No. 204964, October 15, 2014, J. Leonen
The Sps. Sebastian s insistence would have been correct if the monthly amortizations being
paid to BPI Family arose from a sale or financing of real estate. In their case, however, the
monthly amortizations represented the installment payments of a housing loan that BPI
Family had extended to them as an employee s benefit. The monthly amortizations they
were liable for was derived from a loan transaction, not a sale transaction, thereby giving
rise to a lender-borrower relationship between BPI Family and the petitioners.
MONCAYO INTEGRATED SMALL-SCALE MINERS ASSOCIATION, INC. (MISSMA) vs.
SOUTHEAST MINDANAO GOLD MINING CORP. (SMGMC), BALITE INTEGRATED
SMALL-SCALE MINING CORP., (BISSMICO) ET AL., G.R. No. 149638 (consolidated),
December 10, 2014, J. Leonen
The issue in these two consolidated cases involves the tightly contested Diwalwal Gold
Rush Area DGRA in Mt. Diwata, Mindanao, specifically, the
-hectare portion excluded
from SMGMC s Mineral Production Sharing Agreement application (MPSA No. 128), and
declared as People s Small Scale Mining Area. SMGMC was the assignee of the original
holder of a permit to explore (EP 133) covering 4,941 hectares of DGRA. Due to
supervening events, [the Court] declares the petitions moot and academic.
IRENE D. OFILADA, vs. SPOUSES RUBEN ANDAL AND MIRAFLOR ANDAL, G.R. No.
192270, January 26, 2015, J. del Castillo
While a tenancy relationship cannot be extinguished by the sale, alienation, or transfer of
the legal possession of the landholding, the same may nevertheless be terminated due to
circumstances more advantageous to the tenant and his/her family. The tenants having
received an adequate consideration of P1.1 million, it can be reasonably concluded that the
tenancy relationship between the previous owners and the spouses Andal had already been
severed.
IRENE D. OFILADA, vs. SPOUSES RUBEN ANDAL AND MIRAFLOR ANDAL, G.R. No.
192270, January 26, 2015, J. del Castillo
The fact alone of working on another s landholding does not raise a presumption of the
existence of agricultural tenancy. For tenancy to be proven, all indispensable elements
must be established, the absence of one or more requisites will not make the alleged tenant
a de facto one. These are: 1) the parties are the landowner and the tenant; 2) the subject is
agricultural land; 3) there is consent by the landowner; 4) the purpose is agricultural
production; 5) there is personal cultivation; and 6) there is sharing of the harvests.
RICARDO V. QUINTOS vs. DEPARTMENT OF AGRARIAN REFORM ADJUDICATION
BOARD AND KANLURANG MINDORO FARMER'S COOPERATIVE, INC, G.R. No. 185838
February 10, 2014, J. PERLAS-BERNABE
GCFI contracted substantial loans with the PNB DBP which were secured by several real
estate mortgages over GCFI properties. In 1981, Romualdez abandoned the management of
166
the GCFI properties, after which DBP took over. Sometime during the same year, certain
people started to plant palay on the subject property, eventually covering the riceland.
After the EDSA revolution, the possession and management of the GCFI properties were
returned to GCFI. However, in July 1987, the properties were sequestered by the PCGG
albeit, eventually cleared. In the meantime, PNB and DBP transferred their financial claims
against GCFI to the Asset Privatization Trust (APT). KAMIFCI members were allegedly
installed as tenants by APT, the "legal possessor" of the land. However there was no
showing that APT was authorized by the property s landowner, GCF), to install tenants
thereon. Thus, since the consent of the standing landowner, GCFI, had not been secured by
APT in this case, it had no authority to enter into any tenancy agreement with the KAMIFCI
members. The right to hire a tenant is basically a personal right of a landowner, except as
may be provided by law. Hence, the consent of the landowner should be secured prior to
the installation of tenants.
DEPARTMENT OF AGRARIAN REFORM, now represented by OIC-SEC. NASSER
PANGANDAMAN vs .TRINIDAD VALLEY REALTY & DEVELOPMENT CORPORATION,ET
AL./ GRACE B. FUA, ET AL. VS. TRINIDAD VALLEY REALTY & DEVELOPMENT
CORPORATION ET AL/ TRINIDAD VALLEY REALTY & DEVELOPMENT CORPORATION
ET AL. VS. REPUBLIC OF THE PHILIPPINES, ET AL. G.R. No. 1733866 174162 February
11, 2014, J. VILLARAMA JR.
Under Republic Act No. 6657, the Comprehensive Agrarian Reform Law, the Special
Agrarian Courts shall have original and exclusive jurisdiction over all petitions for the
determination of just compensation to landowners, and the prosecution of all criminal
offenses. The case at bar deals with acts of the DAR and the application, implementation,
enforcement, or interpretation of RA 6657 - issues which do not involve the "special
jurisdiction" of the RTC acting as a Special Agrarian Court. Hence, when the court a quo
heard and decided the instant case, it did so without jurisdiction. Decisions, orders, awards
or rulings of the DAR may be brought to the CA by certiorari and not with the RTC through
an ordinary action for cancellation of title.
FRANCLER P. ONDE v THE OFFICE OF THE LOCAL CIVIL REGISTRATION OF LAS PIAS
CITY, G.R No. 197174, September 10, 2014. J. VILLARAMA
Francler Onde filed a petition for correction of entries in his birth certificate with the RTC,
impleading the LCR of Las Pinas City. The RTC held that a correction on his birth certificate
that his parents were married on December 23, 1983 in Bicol to "not married" is a
substantial correction affecting his legitimacy that requires adversarial proceedings.
The Supreme Court agreed. Said correction is substantial as it will affect his legitimacy and
convert him from a legitimate child to an illegitimate one. Corrections of entries in the civil
register including those on citizenship, legitimacy of paternity or filiation, or legitimacy of
167
168