CIVIL LAW REVIEW I

Human Relations & Unfair CompetitionAUSL 16-17

Atty. D. Z. Legaspi

D. HUMAN RELATIONS

1. ABUSE OF RIGHT

Honesto Vivere, non alterum laedere et just suum cique - live virtuously, not injure
others; give everyone his due.
Memo cum alterius deter detremento protest - No person should unjustly enrich
himself at the expense of another.

The principle of abuse of rights is enshrined in Article 19 of the Civil Code:

Art. 19. 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. 20. Every person who, contrary to law, wilfully or negligently causes damage to another,
shall indemnify the latter for the same.

Art. 21. Any person who wilfully causes loss or injury to another in a manner that is contrary
to morals, good customs or public policy shall compensate the latter for the damage.

This provision of law sets standards which must be observed in the exercise of ones
rights as well as in the performance of its duties, to wit:
1. to act with justice;
2. give everyone his due; and
3. observe honesty and good faith.
This article, known to contain what is commonly referred to as the principle of abuse of
rights, sets certain standards which must be observed not only in the exercise of one's rights,
but also in the performance of one's duties. These standards are the following: to act with
justice; to give everyone his due; and to observe honesty and good faith. The law, therefore,
recognizes a primordial limitation on all rights; that in their exercise, the norms of human
conduct set forth in Article 19 must be observed. A right, though by itself legal because
recognized or granted by law as such, may nevertheless become the source of some illegality.
When a right is exercised in a manner which does not conform with the norms enshrined in
Article 19 and results in damage to another, a legal wrong is thereby committed for which the
wrongdoer must be held responsible. But while Article 19 lays down a rule of conduct for the
government of human relations and for the maintenance of social order, it does not provide a
remedy for its violation. Generally, an action for damages under either Article 20 or Article 21
would be proper.
The elements of an abuse of right under Article 19 are 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.
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Article 20 speaks of the general sanction for all other provisions of law which do not especially
provide for their own sanction1. Thus, anyone who, whether willfully or negligently, in the
exercise of his legal right or duty, causes damage to another, shall indemnify his victim for
injuries suffered thereby.

Article 21 deals with acts contra bonus mores (against good morals), and has the following
elements:
1) There is an act which is legal;
2) but which is contrary to morals, good custom, public order, or public policy;
3) and it is done with intent to injure.
There is a common element under Articles 19 and 21, and that is, the act must be intentional.

DAMNUM ADSEQUE INJURIAM VS ABUSE OF RIGHTS

In law, damnum absque injuria (Latin for "loss without injury") is a phrase expressing the
principle of tort law in which some person (natural or legal) causes damage or loss to another,
but does not injure them.

There is a material distinction between damages and injury.

Injury is the illegal invasion of a legal right;
damage is the loss, hurt or harm which results from the injury;
and damages are the recompense or compensation awarded for the damage suffered.

Thus, there can be damage without injury in those instances in which the loss or harm was
not the result of a violation of a legal duty. In such cases the consequences must be borne by
the injured person alone, the law affords no remedy for damages resulting from an act which
does not amount to a legal injury or wrong. These situations are often called damnum absque
injuria.

1 Tolentino, p. 71
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Breach of promise to marry is not an actionable wrong. [De Jesus vs. Syquia, 58 Phil.,
866]BUT damages may be recoverable
Wassmer v. Velez (1964): Mere breach of promise to marry is not an actionable wrong.
But to formally set a wedding and go through all the above-described preparation and
publicity, only to walk out of it when the matrimony is about to be solemnized, is quite
different. This is palpably and unjustifiably contrary to good customs for which
defendant must be held answerable in damages in accordance with Article 21 aforesaid.
Baksh vs. Court of Appeals (1993): Article 21 may also be applied in a breach of promise
to marry where the woman is a victim of moral seduction.Award of damages pursuant
to Article 21 is justified not because of such promise to marry but because of the fraud
and deceit behind it and the willful injury to her honor and reputation which followed
thereafter.
Tanjanco v. Court of Appeals (1966): The conduct of a woman of adult age, maintaining
intimate sexual relations with appellant, with repeated acts of intercourse is
incompatible with the idea of seduction.

2. UNJUST ENRICHMENT

The principle of unjust enrichment is provided under Article 22 of the Civil Code which provides:

Art. 22. Every person who through an act of performance by another, or any other means,
acquires or comes into possession of something at the expense of the latter without just or
legal ground, shall return the same to him.

The main objective of the principle against unjust enrichment is to prevent one from
enriching himself at the expense of another without just cause or consideration.

There is unjust enrichment when a person unjustly retains a benefit to the loss of another, or
when a person retains money or property of another against the fundamental principles of
justice, equity and good conscience. The principle of unjust enrichment requires two conditions:

that a person is benefited without a valid basis or justification, and

that such benefit is derived at the expense of another.

QUANTUM MERUIT
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Under the principle of quantum meruit, a contractor is allowed to recover the reasonable
value of the services rendered despite the lack of a written contract. The measure of recovery
under the principle should relate to the reasonable value of the services performed. The
principle prevents undue enrichment based on the equitable postulate that it is unjust for a
person to retain any benefit without paying for it. Being predicated on equity, the principle should
only be applied if no express contract was entered into, and no specific statutory provision was
applicable.

SOLUTION INDEBITI
Article 2154 of the Civil Code explains the principle of solutio indebiti. Said provision
provides that if something is received when there is no right to demand it, and it was unduly
delivered through mistake, the obligation to return it arises. In such a case, a creditor-debtor
relationship is created under a quasi-contract whereby the payor becomes the creditor who then
has the right to demand the return of payment made by mistake, and the person who has no
right to receive such payment becomes obligated to return the same. The quasi-contract of
solutio indebiti harks back to the ancient principle that no one shall enrich himself unjustly at the
expense of another.
The principle of solutio indebiti applies where:
1) a payment is made when there exists no binding relation between the payor, who
has no duty to pay, and the person who received the payment; and
2) the payment is made through mistake, and not through liberality or some other
cause
Solutio indebiti applies in case of erroneous payment of undue interest.

MALICIOUS PROSECUTION
"Malicious prosecution" has been defined as "an action for damages brought by one
against whom a criminal prosecution, civil suit, or other legal proceeding has been instituted
maliciously and without probable cause, after the termination of such prosecution, suit, or other
proceeding in favor of the defendant therein." To constitute "malicious prosecution," there must
be proof that the prosecution was prompted by a sinister design to vex or humiliate a person,
and that it was initiated deliberately by the defendant knowing that his charges were false and
groundless. Concededly, the mere act of submitting a case to the authorities for prosecution
does not make one liable for malicious prosecution.

Malicious prosecution, both in criminal and civil cases, requires the elements of
1. malice
2. absence of probable cause.

Independent Civil Action;

Arts. 1724; 2142; 2154; 2164; 2176, NCC

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Loria v. Muoz, Jr.,

GR No. 187240. Oct. 15, 2014
738 SCRA 397

FACTS: Muoz was invited by Loria to advance 2Mto him for a subcontract of a P50,000,000.00 river-
dredging project. Loria represented that he would make arrangements such that Elizaldy Co, owner of
Sunwest Construction and Development Corporation, would turn out to be the lowest bidder for the
project and after the project's award to Sunwest, Sunwest would subcontract 20% or P10,000,000.00
worth of the project to Muoz.

Since Muoz had known Loria for five years, Muoz accepted Lorias proposal and gave him
P2,000,000.00. However, Sunwest finished dredging the Masarawag and San Francisco Rivers without
subcontracting Muoz.
Muoz filed the complaint for sum of money to collect the 2M from Loria. The RTC and CA ruled in favor
of Muoz on the basis of unjust enrichment.

Loria filed a petition for review on certiorari with the SC, arguing that the principle of unjust enrichment
does not apply in this case. As the trial and appellate courts found, Muoz paid Loria 2M for a subcontract
of a government project. The parties agreement, therefore, was void for being contrary to law, specifically,
the Anti-Graft and Corrupt Practices Act, the Revised Penal Code, and Section 6 of Presidential Decree
No. 1594. The agreement was likewise contrary to the public policy of public or open competitive bidding
of government contracts. Since the parties agreement was void, Loria argues that the parties were in pari
delicto, and Muoz should not be allowed to recover the money he gave under the contract

ISSUE: Whether or not the principle of unjust enrichment is applicable in the present case.

HELD: Yes. Loria must return Munozs 2Munder the principle of unjust enrichment. Under Article 22 of the
Civil Code of the Philippines, "every person who through an act of performance by another, or any other
means, acquires or comes into possession of something at the expense of the latter without just or legal
ground, shall return the same to him." There is unjust enrichment "when a person unjustly retains a
benefit to the loss of another, or when a person retains money or property of another against the
fundamental principles of justice, equity and good conscience." 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 persons expense or damage.

In this case, Loria received 2M 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 2M. Thus, Loria was
unjustly enriched. He retained Muozs money without valid basis or justification.

Contrary to Lorias claim, Section 6 of the Presidential Decree No. 1594, does not prevent Muoz from
recovering his money.
Under the doctrine of in pari delicto, "no action arises, in equity or at law, from an illegal contract. No suit
can be maintained for its specific performance, or to recover the property agreed to be sold or delivered,
or the money agreed to be paid, or damages for its violation

The application of 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."

The prevention of unjust enrichment is a recognized public policy of the State, for Article 22 of the Civil
Code explicitly provides that "[e]very person who through an act of performance by another, or any other
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means, acquires or comes into possession of something at the expense of the latter without just or legal
ground, shall return the same to him

Rosete v. Briones
GR No. 176121 Sept. 22, 2014 735 SCRA 647

Suffice it to state that petitioners are indeed entitled to be indemnified for paying for the value of
the subject lot and the real property taxes thereon over and above what was awarded to them,
pursuant to Article 1236 of the Civil Code, which states that "[w]hoever pays for another may
demand from the debtor what he has paid, except that if he paid without the knowledge or
against the will of the debtor, he can recover only insofar as the payment has been beneficial to
the debtor." They may also recover from the NHA, applying the principle of solutio indebiti.
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Alano vs Magud-Logmao

GR No. 1755540 April 7, 2014

FACTS: Arnelito Logmao suffered a severe brain injury after falling from an overpass. He was brought to
East Avenue Medical Center, where he was identified as Angelito Logmao. The next morning the patient's
condition progressively deteriorated aand admission to ICU became necessary, but because there was no
vacancy in the EAMC's ICU units, the patient was transferred in National Kindney Institute. In NKI he was
erroneously identified as Angelito Lugmoso.

It was observed that the patients brain was so severe that it manifested symptoms of brain death. Tissue
typing and tissue cross-matching examinations conducted on the patient for the possibility that if the
deceased patient is found to be a suitable organ donor and has his familys consent, the organs could be
harvested and transplanted promptly to any of the compatible beneficiaries.

The Following day Lugmoso was pronounced brain dead. As the extensive search for the relatives of
Lugmoso yielded no positive result and time being of the essence in the success of organ transplantation.
Dr. Ona, Chairman of the Department of Surgery, requested Dr. Filoteo A. Alano to authorize the removal
of specific organs from the body of Lugmoso for transplantation purposes. Dr. Ona, likewise requested Dr.
Liquete to secure permission for the planned organ retrieval and transplantation from the Medico Legal
Office of the NBI.

Dr. Alano issued to Dr. Ona a memorandum to make certain that all reasonable efforts are exerted to
locate the patients relatives, it further stated that permission or authorization to retrieve or remove the
internal organs of the deceased and to transplant said organs to any compatible patient who may be in
need of said organs to live and survive only if the provision of RA 349 and PD 856

ISSUE: Whether or not Dr. Alano cannot be held liable for damages for negligence in granting
authorization for the removal or retrieval of the internal organs of respondent's son who had been
declared brain dead.

HELD: No. Dr. Alano cannot be held liable for damages.

The Memorandum dated March 3, 1988 issued by petitioner, stated thus:

As shown by the medical records, the said patient died on March 3, 1988 at 9:10 in the morning due to
craniocerebral injury. Please make certain that your Department has exerted all reasonable efforts to
locate the relatives or next-of-kin of the said deceased patient, such as appeal through the radios and
television, as well as through police and other government agencies and that the NBI [Medico-Legal]
Section has been notified and is aware of the case.

If all the above has been complied with, in accordance with the provisions of Republic Act No. 349 as
amended and P.D. 856, permission and/or authority is hereby given to the Department of Surgery to
retrieve and remove the kidneys, pancreas, liver and heart of the said deceased patient and to transplant
the said organs to any compatible patient who maybe in need of said organs to live and survive.

A careful reading of the above shows that petitioner instructed his subordinates to make certain that all
reasonable efforts are exerted to locate the patients next of kin, even enumerating ways in which to
ensure that notices of the death of the patient would reach said relatives. 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
petitioner 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
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requirements of the law. Verily, petitioner 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.

Thus, there can be no cavil that petitioners employed reasonable means to disseminate notifications
intended to reach the relatives of the deceased. The only question that remains pertains to the sufficiency
of time allotted for notices to reach the relatives of the deceased.

If respondent failed to immediately receive notice of her sons death because the notices did not properly
state the name or identity of the deceased, fault cannot be laid at petitioners door. The trial and appellate
courts found that it was the EAMC, who recorded the wrong information regarding the deceaseds identity
to NKTI. The NKTI could not have obtained the information about his name from the patient, because as
found by the lower courts, the deceased was already unconscious by the time he was brought to NKI.
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Sesbreo vs. CA
GR No. 160689/March 26, 2014
720 SCRA 57

FACT: 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. the VOC team inspected the electric meter in the house of the plaintif and found that
it had been turned upside down. They took photographs of the upturned electric meter. With Chuchie
Garcia, Peter Sesbreo and one of the maids present, they removed said meter and replaced it with a
new one. The VOC Team then asked for and received Chuchie Garcias permission to enter the house
itself to examine the kind and number of appliances and light fixtures in the household and determine its
electrical load.

Sesbreos main contention is that the inspection of his residence by the VOC team was an unreasonable
search for being carried out without a warrant and for being allegedly done with malice or bad faith.

ISSUE: Was Sesbreo entitled to recover damages for abuse of rights?

HELD: No. The Courts holding could be different had Sesbreo persuasively demonstrated the
intervention of malice or bad faith on the part of Constantino and Arcilla during their 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 Sesbreos residence
because the other houses within the area were similarly subjected to the routine inspection. This, we
think, eliminated any notion of malice or bad faith.

Clearly, Sesbreo did not establish his claim for damages if the respondents were not guilty of abuse of
rights. To stress, 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. The rationale for the concept is
to present some basic principles to be followed for the rightful relationship between human beings and the
stability of social order. Moreover, according to a commentator, "the exercise of right ends when the right
disappears, and it disappears when it is abused, especially to the prejudice of others; It cannot be said
that a person exercises a right when he unnecessarily prejudices another." Article 19 of the Civil Code
sets the standards to be observed in the exercise of ones rights and in the performance of ones duties,
namely: (a) to act with justice; (b) to give everyone his due; and (c) to observe honesty and good faith.
The law thereby recognizes the primordial limitation on all rights that in the exercise of the rights, the
standards under Article 19 must be observed.

Although the act is not illegal, liability for damages may arise should there be an abuse of rights, like
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.
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CCI vs. Quiones

GR No. 175822, Oct. 23, 2013
708 SCRA 420

FACTS: Quiones went inside the Guess USA Boutique in Robinsons Department Store in Cebu City
and decided to purchase the black jeans worth P2098 and paid to the cashier evidenced by a receipt
issued by the store. While she was walking, she was confronted by a Guess employee and told her that
she failed to pay for the item she got to which respondent replied that she did and showed the receipt.
Quiones then suggested they talk about it in the Cebu Pacific office in the mall. While in there, she was
allegedly embarrassed and humiliated by the Guess employees in front of their clients. The next day, the
Guess employees even sent a demand letter to respondents employers. While the RTC ruled for them,
CA reversed the decision saying that the acts done by the employees were not in good faith. Petitioners
pray for the reversal of the decision of CA.

ISSUE: Whether or not the Guess Employees whether guilty of abuse of right.

HELD: Yes. While it is true that the Guess Employees have the right to verify from respondent whether
she indeed made payment if they had reason to believe that she did not. However, the exercise of such
right is not without limitations. Any abuse in the exercise of such right and in the performance of duty
causing damage or injury to another is actionable under the Civil Code.

Initially, there was nothing wrong with petitioners asking respondent whether she paid or not. Considering,
however, that respondent was in possession of the item purchased from the shop, together with the
official receipt of payment issued by petitioners, the latter cannot insist that no such payment was made
on the basis of a mere speculation. Their claim should have been proven by substantial evidence in the
proper forum. It is evident from the circumstances of the case that petitioners went overboard and tried to
force respondent to pay the amount they were demanding. In the guise of asking for assistance,
petitioners even sent a demand letter to respondents employer not only informing it of the incident but
obviously imputing bad acts on the part of respondent.

It can be inferred from the foregoing that in sending the demand letter to respondents employer,
petitioners intended not only to ask for assistance in collecting the disputed amount but to tarnish
respondents reputation in the eyes of her employer. To malign respondent without substantial evidence
and despite the latters possession of enough evidence in her favor, is clearly impermissible. A person
should not use his right unjustly or contrary to honesty and good faith, otherwise, he opens himself to
liability.

The exercise of a right must be in accordance with the purpose for which it was established and must not
be excessive or unduly harsh. In this case, petitioners obviously abused their rights.
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Hing v. Choachuy Sr.

GR No. 179736, June 26, 2013
699 SCRA 667

The right to privacy is enshrined in our Constitution and in our laws. It is defined as the right to be free
from unwarranted exploitation of ones person or from intrusion into ones private activities in such a way
as to cause humiliation to a persons ordinary sensibilities. It is the right of an individual to be free from
unwarranted publicity, or to live without unwarranted interference by the public in matters in which the
public is not necessarily concerned. Simply put, the right to privacy is the right to be let alone. The Bill
of Rights guarantees the peoples right to privacy and protects them against the States abuse of power.
In this regard, the State recognizes the right of the people to be secure in their houses. No one, not even
the State, except in case of overriding social need and then only under the stringent procedural
safeguards, can disturb them in the privacy of their homes.

Article 26(1) of the Civil Code protects an individuals right to privacy and provides a legal remedy
against abuses that may be committed against him by other individuals; This provision
recognizes that a mans house is his castle, where his right to privacy cannot be denied or even
restricted by others.Article 26(1) of the Civil Code, on the other hand, protects an individuals right to
privacy and provides a legal remedy against abuses that may be committed against him by other
individuals. It states: Art.26. Every person shall respect the dignity, personality, privacy and peace of
mind of his neighbors and other persons. The following and similar acts, though they may not constitute a
criminal offense, shall produce a cause of action for damages, prevention and other relief: (1) Prying into
the privacy of anothers residence; x x x x This provision recognizes that a mans house is his castle,
where his right to privacy cannot be denied or even restricted by others. It includes any act of intrusion
into, peeping or peering inquisitively into the residence of another without the consent of the latter. The
phrase prying into the privacy of anothers residence, however, does not mean that only the residence is
entitled to privacy. As elucidated by Civil law expert Arturo M. Tolentino: Our Code specifically mentions
prying into the privacy of anothers residence. This does not mean, however, that only the residence is
entitled to privacy, because the law covers also similar acts. A business office is entitled to the same
privacy when the public is excluded therefrom and only such individuals as are allowed to enter may
come in. x x x (Emphasis supplied) Thus, an individuals right to privacy under Article 26(1) of the Civil
Code should not be confined to his house or residence as it may extend to places where he has the right
to exclude the public or deny them access. The phrase prying into the privacy of anothers residence,
therefore, covers places, locations, or even situations which an individual considers as private. And as
long as his right is recognized by society, other individuals may not infringe on his right to privacy. The
CA, therefore, erred in limiting the application of Article 26(1) of the Civil Code only to residences.

Reasonable Expectation of Privacy Test; In ascertaining whether there is a violation of the right to
privacy, courts use the reasonable expectation of privacy test. This test determines whether a
person has a reasonable expectation of privacy and whether the expectation has been
violated.In ascertaining whether there is a violation of the right to privacy, courts use the reasonable
expectation of privacy test. This test determines whether a person has a reasonable expectation of
privacy and whether the expectation has been violated. In Ople v. Torres, 504 SCRA 704 (2006), we
enunciated that the reasonableness of a persons expectation of privacy depends on a two-part test: (1)
whether, by his conduct, the individual has exhibited an expectation of privacy; and (2) this expectation is
one that society recognizes as reasonable. Customs, community norms, and practices may, therefore,
limit or extend an individuals reasonable expectation of privacy. Hence, the reasonableness of a
persons expectation of privacy must be determined on a case-to-case basis since it depends on the
factual circumstances surrounding the case.
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Surveillance Cameras; In this day and age, video surveillance cameras are installed practically
everywhere for the protection and safety of everyone. The installation of these cameras, however,
should not cover places where there is reasonable expectation of privacy, unless the consent of
the individual, whose right to privacy would be affected, was obtained.In this day and age, video
surveillance cameras are installed practically everywhere for the protection and safety of everyone. The
installation of these cameras, however, should not cover places where there is reasonable expectation of
privacy, unless the consent of the individual, whose right to privacy would be affected, was obtained. Nor
should these cameras be used to pry into the privacy of anothers residence or business office as it would
be no different from eavesdropping, which is a crime under Republic Act No. 4200 or the Anti-Wiretapping
Law.

A real party defendant is one who has a correlative legal obligation to redress a wrong done to
the plaintiff by reason of the defendants act or omission which had violated the legal right of the
former.Section 2, Rule 3 of the Rules of Court provides: SEC. 2. Parties-in-interest.A real party-in-
interest is the party who stands to be benefited or injured by the judgment in the suit, or the party entitled
to the avails of the suit. Unless otherwise authorized by law or these Rules, every action must be
prosecuted or defended in the name of the real party-in-interest. A real party defendant is one who has a
correlative legal obligation to redress a wrong done to the plaintiff by reason of the defendants act or
omission which had violated the legal right of the former. In ruling that respondents are not the proper
parties, the CA reasoned that since they do not own the building, they could not have installed the video
surveillance cameras. Such reasoning, however, is erroneous. The fact that respondents are not the
registered owners of the building does not automatically mean that they did not cause the installation of
the video surveillance cameras Hing vs. Choachuy, Sr., 699 SCRA 667, G.R. No. 179736 June 26, 2013
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PTC v. Legaspi
GR# 202791, June 10, 2013
698 SCRA 280

FACTS: Leandro Legaspi was employed as Utility Pastry on board the vessel "Azamara Journey" under
the employment of petitioner Philippine Transmarine Carriers, Inc. (PTC). Legaspiss employment was
covered by a Collective Bargaining Agreement (CBA) wherein it was agreed that the company shall pay a
maximum disability compensation of up to US$60,000.00 only. While on board the vessel, respondent
suffered "Cardiac Arrest S/P ICD Insertation." He was checked by the ships doctor and was prescribed
medications. On November 14, 2008, respondent was repatriated to receive further medical treatment
and examination. On May 23, 2009, the company designated physician assessed his condition to be
Disability Grade 2. Not satisfied, Legaspi filed a complaint for full and permanent disability compensation
against petitioner before the Labor Arbiter who ruled in his favor. The LA awarded US$80,000.00 based
on the ITF Cruise Ship Model Agreement for Catering Personnel, not on the CBA. Not satisfied, PTC
appealed the LA decision before the National Labor Relations Commission, however the NLRC affirmed
the LA award. During the hearing on the motion for execution before the NLRC, PTC agreed to pay
Legaspi US$81,320.00. The terms and conditions of said payment were embodied in the Receipt of
Judgment Award with Undertaking, wherein respondent acknowledged receipt of the said amount and
undertook to return it to petitioner in the event the latters petition for certiorari would be granted, without
prejudice to respondents right to appeal.

Unaware of a) the September 5, 2010 entry of judgment of the NLRC, b) the October 22, 2010 payment
of US$81,320.00, and c) the writ of execution issued by the LA, the CA rendered its Decision partially
granting the petition for certiorari and modified the assailed resolutions of the NLRC, awarding only
US$60,000.00 pursuant to the CBA between Celebrity Cruise Lines and Federazione Italianaa Transporti
CISL.

ISSUE: Whether or not PTC is estopped from collecting the excess payment it made to Legaspi
notwithstanding the Receipt of Judgment Award signed by Legaspi.

HELD: As the agreement was voluntarily entered into and represented a reasonable settlement, it is
binding on the parties and may not later be disowned simply because of a change of mind. Respondent
Legaspi agreed to the stipulation that he would return the amount paid to him in the event that the petition
for certiorari would be granted. Since the petition was indeed granted by the CA, albeit partially,
respondent must comply with the condition to return the excess amount.

The Court finds that the Receipt of the Judgment Award with Undertaking was a fair and binding
agreement. It was executed by the parties subject to outcome of the petition. To allow now respondent to
retain the excess money judgment would amount to his unjust enrichment to the prejudice of petitioner.

Unjust enrichment is a term used to depict result or effect of failure to make remuneration of or for
property or benefits received under circumstances that give rise to legal or equitable obligation to account
for them. To be entitled to remuneration, one must confer benefit by mistake, fraud, coercion, or request.
Unjust enrichment is not itself a theory of reconveyance. Rather, it is a prerequisite for the enforcement of
the doctrine of restitution.19 There is unjust enrichment when:

1. A person is unjustly benefited; and

2. Such benefit is derived at the expense of or with damages to another.20

In the case at bench, petitioner paid respondent US$81,320.00 in the pre-execution conference plus
attorneys fees of US$8,132.00 pursuant to the writ of execution. The June 29, 2011 CA Decision,
however, modified the final resolution of the NLRC and awarded only US$60,000.00 to respondent. If not
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allowed to return the excess, the respondent would have been unjustly benefited to the prejudice and
expense of petitioner.

Beumer vs. Amores

GR# 195670/Dec. 03, 2012 686 SCRA 770

The time-honored principle is that he who seeks equity must do equity, and he who comes into equity
must come with clean hands.As also explained in Muller, the time-honored principle is that he who
seeks equity must do equity, and he who comes into equity must come with clean hands. Conversely
stated, he who has done inequity shall not be accorded equity. Thus, a litigant may be denied relief by a
court of equity on the ground that his conduct has been inequitable, unfair and dishonest, or fraudulent, or
deceitful.

Equity as a rule will follow the law and will not permit that to be done indirectly which, because of public
policy, cannot be done directly. Surely, a contract that violates the Constitution and the law is null and
void, vests no rights, creates no obligations and produces no legal effect at all.In any event, the Court
cannot, even on the grounds of equity, grant reimbursement to petitioner given that he acquired no right
whatsoever over the subject properties by virtue of its unconstitutional purchase. It is well-established that
equity as a rule will follow the law and will not permit that to be done indirectly which, because of public
policy, cannot be done directly. Surely, a contract that violates the Constitution and the law is null and
void, vests no rights, creates no obligations and produces no legal effect at all. Corollary thereto, under
Article 1412 of the Civil Code, petitioner cannot have the subject properties deeded to him or allow him to
recover the money he had spent for the purchase thereof. The law will not aid either party to an illegal
contract or agreement; it leaves the parties where it finds them. Indeed, one cannot salvage any rights
from an unconstitutional transaction knowingly entered into.

Principle of Unjust Enrichment; No person should unjustly enrich himself at the expense of
another.Neither can the Court grant petitioners claim for reimbursement on the basis of unjust
enrichment. As held in Frenzel v. Catito, a case also involving a foreigner seeking monetary
reimbursement for money spent on purchase of Philippine land, the provision on unjust enrichment does
not apply if the action is proscribed by the Constitution, to wit: Futile, too, is petitioners reliance on Article
22 of the New Civil Code which reads: Art. 22. Every person who through an act of performance by
another, or any other means, acquires or comes into possession of something at the expense of the latter
without just or legal ground, shall return the same to him. The provision is expressed in the maxim:
MEMO CUM ALTERIUS DETER DETREMENTO PROTEST (No person should unjustly enrich himself
at the expense of another). 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 in this case, the action is
proscribed by the Constitution or by the application of the pari delicto doctrine. It may be unfair and unjust
to bar the petitioner from filing an accion in rem verso over the subject properties, or from recovering the
money he paid for the said properties, but, as Lord Mansfield stated in the early case of Holman v.
Johnson: The objection that a contract is immoral or illegal as between the plaintiff and the defendant,
sounds at all times very ill in the mouth of the defendant. It is not for his sake, however, that the objection
is ever allowed; but it is founded in general principles of policy, which the defendant has the advantage of,
contrary to the real justice, as between him and the plaintiff. Beumer vs. Amores, 686 SCRA 770, G.R.
No. 195670 December 3, 2012
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Padalhin vs. Lavia GR# 183026/Nov. 14, 2012 685 SCRA 549

Violation of Privacy of Ones Residence; Nestor violated the New Civil Code prescriptions
concerning the privacy of ones residence and he cannot hide behind the cloak of his supposed
benevolent intentions to justify the invasion. Hence, the award of damages and attorneys fees in
Lavinas favor is proper.As already exhaustively discussed by both the RTC and the CA, Nestor
himself admitted that he caused the taking of the pictures of Lavias residence without the latters
knowledge and consent. Nestor reiterates that he did so sans bad faith or malice. However, Nestors
surreptitious acts negate his allegation of good faith. If it were true that Lavia kept ivories in his
diplomatic residence, then, his behavior deserves condemnation. However, that is not the issue in the
case at bar. Nestor violated the New Civil Code prescriptions concerning the privacy of ones residence
and he cannot hide behind the cloak of his supposed benevolent intentions to justify the invasion. Hence,
the award of damages and attorneys fees in Lavias favor is proper.
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Cheng v. Sy GR# 174238/July 07, 2009 592 SCRA 1

Unjust Enrichment; Solutio Indebiti; There is unjust enrichment when 1) a person is unjustly benefited,
and 2) such benefit is derived at the expense of or with damages to another.We take into consideration
the trial courts observation when it dismissed the estafa charge in Criminal Case No. 98-969953 that if
there was any liability on the part of respondents, it was civil in nature. Hence, if the loan be proven true,
the inability of petitioner to recover the loaned amount would be tantamount to unjust enrichment of
respondents, as they may now conveniently evade payment of their obligation merely on account of a
technicality applied against petitioner. There is unjust enrichment when (1) a person is unjustly benefited,
and (2) such benefit is derived at the expense of or with damages to another. This doctrine simply means
that a person shall not be allowed to profit or enrich himself inequitably at anothers expense. One
condition for invoking this principle of unjust enrichment is that the aggrieved party has no other recourse
based on contract, quasi-contract, crime, quasi-delict or any other provision of law.
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Cheng v. Donini GR# 167017/June 22, 2009 590 SCRA 406

Equity which has been aptly described as justice outside legality, is applied only in the absence
of, and never against, statutory law or judicial rules of procedure. Petitioner, however, correctly
argued that the principle of equity did not apply in this case. Equity, which has been aptly described as
justice outside legality, is applied only in the absence of, and never against, statutory law or judicial rules
of procedure. Positive rules prevail over all abstract arguments based on equity contra legem. Neither is
the principle of unjust enrichment applicable since petitioner (who was to benefit from it) had a valid claim.

Reimbursement of Useful Improvements; Articles 448 and 546, which allow full reimbursement of
useful improvements and retention of the premises until reimbursement is made, apply only to a
possessor in good faith or one who builds on land in the belief that he is the owner thereof.
Contrary to respondents position, Articles 448 and 546 of the Civil Code did not apply. Under these
provisions, to be entitled to reimbursement for useful improvements introduced on the property,
respondents must be considered builders in good faith. Articles 448 and 546, which allow full
reimbursement of useful improvements and retention of the premises until reimbursement is made, apply
only to a possessor in good faith or one who builds on land in the belief that he is the owner thereof. A
builder in good faith is one who is unaware of any flaw in his title to the land at the time he builds on it.
Same; Same; A lessee is neither a builder nor a possessor in good faith.As early as 1956, in Lopez v.
Philippine & Eastern Trading Co., Inc., 98 Phil. 348 (1956), the Court clarified that a lessee is neither a
builder nor a possessor in good faithx x x This principle of possessor in good faith naturally cannot
apply to a lessee because as such lessee he knows that he is not the owner of the leased property.
Neither can he deny the ownership or title of his lessor. Knowing that his occupation of the premises
continues only during the life of the lease contract and that he must vacate the property upon termination
of the lease or upon the violation by him of any of its terms, he introduces improvements on said property
at his own risk in the sense that he cannot recover their value from the lessor, much less retain the
premises until such reimbursement. (Emphasis supplied)

Lessor has the primary right (or the first move) to reimburse the lessee for 50% of the value of the
improvements at the end of the lease. If the lessor refuses to make the reimbursement, the
subsidiary right of the lessee to remove the improvements, even though the principal thing
suffers damage, arises.Under Article 1678 of the Civil Code, the lessor has the primary right (or the
first move) to reimburse the lessee for 50% of the value of the improvements at the end of the lease. If the
lessor refuses to make the reimbursement, the subsidiary right of the lessee to remove the improvements,
even though the principal thing suffers damage, arises. Consequently, on petitioner rests the primary
option to pay for one-half of the value of the useful improvements. It is only when petitioner as lessor
refuses to make the reimbursement that respondents, as lessees, may remove the improvements. Should
petitioner refuse to exercise the option of paying for one-half of the value of the improvements, he cannot
be compelled to do so. It then lies on respondents to insist on their subsidiary right to remove the
improvements even though the principal thing suffers damage but without causing any more impairment
on the property leased than is necessary.
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ASJ Corp. vs. Evangelista GR# 158086/ Feb. 14, 2008 545 SCRA 300

Where it was established that a person suffered some pecuniary loss anchored on another
persons abuse of rights, although the exact amount of actual damages cannot be ascertained,
temperate damages are recoverable.Since it was established that respondents suffered some
pecuniary loss anchored on petitioners abuse of rights, although the exact amount of actual damages
cannot be ascertained, temperate damages are recoverable. In arriving at a reasonable level of
temperate damages of P408,852.10, which is equivalent to the value of the chicks and by-products, which
respondents, on the average, are expected to derive, this Court was guided by the following factors: (a)
award of temperate damages will cover only Setting Report Nos. 109 to 113 since the threats started only
on February 10 and 11, 1993, which are the pick-up dates for Setting Report Nos. 109 and 110; the rates
of (b) 41% and (c) 17%, representing the average rates of conversion of broiler eggs into hatched chicks
and egg by-products as tabulated by the trial court based on available statistical data which was
unrebutted by petitioners; (d) 68,784 eggs, or the total number of broiler eggs under Setting Report Nos.
109 to 113; and (e) P14.00 and (f) P1.20, or the then unit market price of the chicks and by-products,
respectively.
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UP v. Philab GR# 152411/ Sept. 29, 2004 439 SCRA 467

There is no dispute that the respondent is not privy to the Memorandum of Agreement (MOA)
executed by the petitioner and Ferdinand E. Marcos Foundation (FEMF), hence it is not bound by
the said agreement; Contracts take effect only between the parties and their assigns; A contract
cannot be binding upon and cannot be enforced against one who is not a party to it, even if he is
aware of such contract and has acted with knowledge thereof .Contracts take effect only between
the parties and their assigns. A contract cannot be binding upon and cannot be enforced against one who
is not a party to it, even if he is aware of such contract and has acted with knowledge thereof. Likewise
admitted by the parties, is the fact that there was no written contract executed by the petitioner, the
respondent and FEMF relating to the fabrication and delivery of office and laboratory furniture to the
BIOTECH. Even the CA failed to specifically declare that the petitioner and the respondent entered into a
contract of sale over the said laboratory furniture. The parties are in accord that the FEMF had remitted to
the respondent partial payments via checks drawn and issued by the FEMF to the respondent, through
Padolina, in the total amount of P2,288,573.74 out of the total cost of the project of P2,934,068.90 and
that the respondent received the said checks and issued receipts therefor to the FEMF. There is also no
controversy that the petitioner did not pay a single centavo for the said furniture delivered by the
respondent that the petitioner had been using ever since.

Implied-in-Fact Contracts; A contract implied-in-fact is one implied from facts and circumstances
showing as mutual intention to contractit arises where the intention of the parties is not
expressed, but an agreement in fact creating an obligation; An implied-in-fact contract will not
arise unless the meeting of minds is indicated by some intelligent conduct, act, or sign.A
contract implied in fact is one implied from facts and circumstances showing a mutual intention to
contract. It arises where the intention of the parties is not expressed, but an agreement in fact creating an
obligation. It is a contract, the existence and terms of which are manifested by conduct and not by direct
or explicit words between parties but is to be deduced from conduct of the parties, language used, or
things done by them, or other pertinent circumstances attending the transaction. To create contracts
implied in fact, circumstances must warrant inference that one expected compensation and the other to
pay. An implied-in-fact contract requires the parties intent to enter into a contract; it is a true contract. The
conduct of the parties is to be viewed as a reasonable man would view it, to determine the existence or
not of an implied-in-fact contract. The totality of the acts/conducts of the parties must be considered to
determine their intention. An implied-in-fact contract will not arise unless the meeting of minds is indicated
by some intelligent conduct, act or sign.

Principle of Solutio Indebiti; Unjust enrichment claims do not lie simply because one party
benefits from the efforts or obligations of others, but instead must be shown that a party was
unjustly enriched in the sense that the term unjustly could mean illegally or unlawfully.Unjust
enrichment claims do not lie simply because one party benefits from the efforts or obligations of others,
but instead it must be shown that a party was unjustly enriched in the sense that the term unjustly could
mean illegally or unlawfully.

Restitution or Accion In Rem Verso; In order that an accion in rem verso may prosper, the
essential elements must be present: (1) that the defendant has been enriched, (2) that plaintiff has
suffered a loss, (3) that the enrichment of the defendant is without just or legal ground, (4) and
that plaintiff has no other action based on contract, quasi-contract, crime or quasi-delict.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. An accion in rem verso is considered merely an auxiliary action, available only when there
is no other remedy on contract, quasi-contract, crime, and quasi-delict. If there is an obtainable action
under any other institution of positive law, that action must be resorted to, and the principle of accion in
rem verso will not lie.
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Ilusorio v. Bildner GR# 139789 /July 19, 2001 361 SCRA 427

Husband and Wife; The law provides that the husband and the wife are obliged to live together,
observe mutual love, respect and fidelity, and the sanction therefor is the spontaneous, mutual
affection between husband and wife and not any legal mandate or court order to enforce
consortium.Erlinda states that Article XII of the 1987 Constitution and Articles 68 and 69 of the Family
Code support her position that as spouses, they (Potenciano and Erlinda) are duty bound to live together
and care for each other. We agree. The law provides that the husband and the wife are obliged to live
together, observe mutual love, respect and fidelity. The sanction therefor is the spontaneous, mutual
affection between husband and wife and not any legal mandate or court order to enforce consortium.

Empathy is defined as a shared feeling between husband and wife experienced not only by having
spontaneous sexual intimacy but a deep sense of spiritual communion.Obviously, there was
absence of empathy between spouses Erlinda and Potenciano, having separated from bed and board
since 1972. We defined empathy as a shared feeling between husband and wife experienced not only by
having spontaneous sexual intimacy but a deep sense of spiritual communion. Marital union is a two-way
process. Marriage is definitely for two loving adults who view the relationship with amor gignit amorem
respect, sacrifice and a continuing commitment to togetherness, conscious of its value as a sublime social
institution.
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Ilusorio v. Bildner GR# 139789, May 12, 2000 332 SCRA 1

Right to Privacy; A person of sound mind is possessed with the capacity to make choices, and
even as the choices he makes may not appeal to some of his family members these are choices
which exclusively belong to him.As to lawyer Potenciano Ilusorios mental state, the Court of
Appeals observed that he was of sound and alert mind, having answered all the relevant questions to the
satisfaction of the court. Being of sound mind, he is thus possessed with the capacity to make choices. In
this case, the crucial choices revolve on his residence and the people he opts to see or live with. The
choices he made may not appeal to some of his family members but these are choices which exclusively
belong to Potenciano. He made it clear before the Court of Appeals that he was not prevented from
leaving his house or seeing people. With that declaration, and absent any true restraint on his liberty, we
have no reason to reverse the findings of the Court of Appeals.

A person with full mental capacity coupled with the right of choice may not be the subject of
visitation rights against his free choice.With his full mental capacity coupled with the right of choice,
Potenciano Ilusorio may not be the subject visitation rights against his free choice. Otherwise, we will
deprive him of his right to privacy. Needless to say, this will run against his fundamental constitutional
right. The Court of Appeals exceeded its authority when it awarded visitation rights in a petition for habeas
corpus where Erlinda never even prayed for such right. The ruling is not consistent with the finding of
subjects sanity.

Husband and Wife; Marriage; In case the husband refuses to see his wife for private reasons, he
is at liberty to do so without threat of any penalty attached to the exercise of his right.When the
court ordered the grant of visitation rights, it also emphasized that the same shall be enforced under
penalty of contempt in case of violation or refusal to comply. Such assertion of raw, naked power is
unnecessary. The Court of Appeals missed the fact that the case did not involve the right of a parent to
visit a minor child but the right of a wife to visit a husband. In case the husband refuses to see his wife for
private reasons, he is at liberty to do so without threat of any penalty attached to the exercise of his right.

No court is empowered as a judicial authority to compel a husband to live with his wife; Coverture
cannot be enforced by compulsion of a writ of habeas corpus carried out by sheriffs or by any
other mesne process.No court is empowered as a judicial authority to compel a husband to live with
his wife. Coverture cannot be enforced by compulsion of a writ of habeas corpus carried out by sheriffs or
by any other mesne process. That is a matter beyond judicial authority and is best left to the man and
womans free choice.
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UE vs Jader GR# 132344/Feb. 7, 2000 325 SCRA 805

It is the contractual obligation of the school to timely inform and furnish sufficient notice and
information to each and every student as to whether he or she had already complied with all the
requirements for the conferment of a degree or whether they would be included among those who
will graduate.The Court takes judicial notice of the traditional practice in educational institutions
wherein the professor directly furnishes his/her students their grades. It is the contractual obligation of the
school to timely inform and furnish sufficient notice and information to each and every student as to
whether he or she had already complied with all the requirements for the conferment of a degree or
whether they would be included among those who will graduate. Although commencement exercises are
but a formal ceremony, it nonetheless is not an ordinary occasion, since such ceremony is the educational
institutions way of announcing to the whole world that the students included in the list of those who will be
conferred a degree during the baccalaureate ceremony have satisfied all the requirements for such
degree. Prior or subsequent to the ceremony, the school has the obligation to promptly inform the student
of any problem involving the latters grades and performance and also most importantly, of the procedures
for remedying the same.

Absence of good faith must be sufficiently established for a successful prosecution by the
aggrieved party in a suit for abuse of right under Article 19 of the Civil Code. Petitioner, in
belatedly informing respondent of the result of the removal examination, particularly at a time when he
had already commenced preparing for the bar exams, cannot be said to have acted in good faith.
Absence of good faith must be sufficiently established for a successful prosecution by the aggrieved party
in a suit for abuse of right under Article 19 of the Civil Code. Good faith connotes an honest intention to
abstain from taking undue advantage of another, even though the forms and technicalities of the law,
together with the absence of all information or belief of facts, would render the transaction
unconscientious.

The negligent act of a professor who fails to observe the rules of the school, for instance by not
promptly submitting a students grade, is not only imputable to the professor but is an act of the
school, being his employer.The college dean is the senior officer responsible for the operation of an
academic program, enforcement of rules and regulations, and the supervision of faculty and student
services. He must see to it that his own professors and teachers, regardless of their status or position
outside of the university, must comply with the rules set by the latter. The negligent act of a professor who
fails to observe the rules of the school, for instance by not promptly submitting a students grade, is not
only imputable to the professor but is an act of the school, being his employer.

Want of care to the conscious disregard of civil obligations coupled with a conscious knowledge
of the cause naturally calculated to produce them would make the erring party liable. Educational
institutions are duty-bound to inform the students of their academic status and not wait for the latter to
inquire from the former. The conscious indifference of a person to the rights or welfare of the
person/persons who may be affected by his act or omission can support a claim for damages. Want of
care to the conscious disregard of civil obligations coupled with a conscious knowledge of the cause
naturally calculated to produce them would make the erring party liable.

The modern tendency is to grant indemnity for damages in cases where there is abuse of right,
even when the act is not illicit.Petitioner cannot pass on its blame to the professors to justify its own
negligence that led to the delayed relay of information to respondent. When one of two innocent parties
must suffer, he through whose agency the loss occurred must bear it. The modern tendency is to grant
indemnity for damages in cases where there is abuse of right, even when the act is not illicit. If mere fault
or negligence in ones acts can make him liable for damages for injury caused thereby, with more reason
should abuse or bad faith make him liable. A person should be protected only when he acts in the
legitimate exercise of his right, that is, when he acts with prudence and in good faith, but not when he acts
with negligence or abuse.
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While petitioner was guilty of negligence and thus liable to respondent for the latters actual
damages, Court holds that respondent should not have been awarded moral damages.While
petitioner was guilty of negligence and thus liable to respondent for the latters actual damages, we hold
that respondent should not have been awarded moral damages. We do not agree with the Court of
Appeals findings that respondent suffered shock, trauma and pain when he was informed that he could
not graduate and will not be allowed to take the bar examinations. At the very least, it behooved on
respondent to verify for himself whether he has completed all necessary requirements to be eligible for
the bar examinations. As a senior law student, respondent should have been responsible enough to
ensure that all his affairs, specifically those pertaining to his academic achievement, are in order. Given
these considerations, we fail to see how respondent could have suffered untold embarrassment in
attending the graduation rites, enrolling in the bar review classes and not being able to take the bar
exams. If respondent was indeed humiliated by his failure to take the bar, he brought this upon himself by
not verifying if he has satisfied all the requirements including his school records, before preparing himself
for the bar examination.
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Figueroa vs. Barranco SBC Case # 519/July 31, 1997 276 5CRA 445

Gross Immorality; Words and Phrases; A persons engaging in premarital sexual relations with
another, making promises to marry, suggests a doubtful moral character but the same does not
constitute grossly immoral conduct; A grossly immoral act is one that is so corrupt and false as
to constitute a criminal act or so unprincipled or disgraceful as to be reprehensible to a high
degree.Respondent was prevented from taking the lawyers oath in 1971 because of the charges of
gross immorality made by complainant. To recapitulate, respondent bore an illegitimate child with his
sweetheart, Patricia Figueroa, who also claims that he did not fulfill his promise to marry her after he
passes the bar examinations. We find that these facts do not constitute gross immorality warranting the
permanent exclusion of respondent from the legal profession. His engaging in premarital sexual relations
with complainant and promises to marry suggests a doubtful moral character on his part but the same
does not constitute grossly immoral conduct. The Court has held that to justify suspension or disbarment
the act complained of must not only be immoral, but grossly immoral. A grossly immoral act is one that is
so corrupt and false as to constitute a criminal act or so unprincipled or disgraceful as to be reprehensible
to a high degree. It is a willful, flagrant, or shameless act which shows a moral indifference to the opinion
of respectable members of the community.

Mere intimacy between a man and a woman, both of whom possess no impediment to marry,
voluntarily carried on and devoid of any deceit on the part of the former, is neither so corrupt nor
so unprincipled as to warrant the imposition of disciplinary sanction against him, even if as a
result of such relationship a child was born out of wedlock.We find the ruling in Arciga v.
Maniwang quite relevant because mere intimacy between a man and a woman, both of whom possess no
impediment to marry, voluntarily carried on and devoid of any deceit on the part of respondent, is neither
so corrupt nor so unprincipled as to warrant the imposition of disciplinary sanction against him, even if as
a result of such relationship a child was born out of wedlock.

The Supreme Court cannot castigate a man for seeking out the partner of his dreams, for
marriage is a sacred and perpetual bond which should be entered into because of love, not for
any other reason.Respondent and complainant were sweethearts whose sexual relations were
evidently consensual. We do not find complainants assertions that she had been forced into sexual
intercourse, credible. She continued to see and be respondents girlfriend even after she had given birth
to a son in 1964 and until 1971. All those years of amicable and intimate relations refute her allegations
that she was forced to have sexual congress with him. Complainant was then an adult who voluntarily and
actively pursued their relationship and was not an innocent young girl who could be easily led astray.
Unfortunately, respondent chose to marry and settle permanently with another woman. We cannot
castigate a man for seeking out the partner of his dreams, for marriage is a sacred and perpetual bond
which should be entered into because of love, not for any other reason.
Even assuming that a persons indiscretions are ignoble, the twenty-six years that he has been
prevented from being a lawyer constitute sufficient punishment therefor.We cannot help viewing
the instant complaint as an act of revenge of a woman scorned, bitter and unforgiving to the end. It is also
intended to make respondent suffer severely and it seems, perpetually, sacrificing the profession he
worked very hard to be admitted into. Even assuming that his past indiscretions are ignoble, the twenty-
six years that respondent has been prevented from being a lawyer constitute sufficient punishment
therefor. During this time there appears to be no other indiscretion attributed to him. Respondent, who is
now sixty-two years of age, should thus be allowed, albeit belatedly, to take the lawyers oath.
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f. Unfair Competition; Art. 28, NCC 3

Art. 28. Unfair competition in agricultural, commercial or industrial enterprises or in labor through
the use of force, intimidation, deceit, machination or any other unjust, oppressive or highhanded
method shall give rise to a right of action by the person who thereby suffers damage.

WPC v. JMC
GR#195549/Sept. 3, 2014 734 SCRA 238

Unfair Competition; The instant case falls under Article 28 of the Civil Code on human relations,
and not unfair competition under Republic Act (R.A.) No. 8293, as the present suit is a damage
suit and the products are not covered by patent registration.Prefatorily, we would like to stress that
the instant case falls under 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 competitors
contracts, or any malicious interference with the latters business.

Article 28 of the Civil Code provides that unfair competition in agricultural, commercial or
industrial enterprises or in labor through the use of force, intimidation, deceit, machination or any
other unjust, oppressive or high-handed method shall give rise to a right of action by the person
who thereby suffers damage.Article 28 of the Civil Code provides that unfair competition in
agricultural, commercial or industrial enterprises or in labor through the use of force, intimidation, deceit,
machination or any other unjust, oppressive or high-handed method shall give rise to a right of action by
the person who thereby suffers damage. From the foregoing, it is clear that what is being sought to be
prevented is not competition per se but the use of unjust, oppressive or high-handed methods which may
deprive others of a fair chance to engage in business or to earn a living. Plainly, what the law prohibits is
unfair competition and not competition where the means used are fair and legitimate.

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 method.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 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 is engaged in unfair competition as shown by his act of suddenly
shifting his business from manufacturing kitchenware to plastic-made automotive parts; his
luring the employees of the respondent to transfer to his employ and trying to discover the trade
secrets of the respondent.It is evident that petitioner is engaged in unfair competition as shown by his
act of suddenly shifting his business from manufacturing kitchenware to plastic-made automotive parts;
his luring the employees of the respondent to transfer to his employ and trying to discover the trade
secrets of the respondent. Moreover, when a person starts an opposing place of business, not for the
sake of profit to himself, but regardless of loss and for the sole purpose of driving his competitor out of
business so that later on he can take advantage of the effects of his malevolent purpose, he is guilty of
wanton wrong. As aptly observed by the court a quo, the testimony of petitioners witnesses indicate that it
CIVIL LAW REVIEW I
Human Relations & Unfair CompetitionAUSL 16-17
Atty. D. Z. Legaspi

acted in bad faith in competing with the business of respondent. x x x In sum, petitioner is guilty of unfair
competition under Article 28 of the Civil Code.