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CIVIL LAW
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words. There is a clear case of breach of contract by the petitioner in adding extraneous and
libelous matters in the message sent to Dionela.
Gashme Shookat Baksh vs CA,219 SCRA115 (1993)
Where a mans promise to marry is in fact the proximate cause of the acceptance of his love by a
woman and his representation to fulfill that promise thereafter becomes the proximate cause of
the giving of herself unto him a sexual congress, proof that he had, in reality, no intention of
marrying her and that the promise was only a subtle scheme or deceptive device to entice or
inveigle her to accept him and to obtain her consent to the sexual act, could justify the award of
damages pursuant to article 21 of the new civil code not because of such promise to marry but
because of the fraud and deceit behind it and the wilful injury to her honor and reputation which
followed thereafter.
University of the East vs Jader, G.R. NO. 132344, Feb. 7, 2000
A law student was allowed to graduate by his school with a failing grade but was later on
prohibited by the said school to take the bar exams. The negligent act of a professor who fails to
observe the rules of the school, for instance by not promptly submitting a student's grade, is not
only imputable to the professor but is an act of the school, being his employer.
SPOUSES HING v. ALEXANDER CHOACHUY, SR. G.R. No. 179736. June 26, 2013
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.
WILLAWARE PRODUCTS CORPORATION vs. JESICHRIS MANUFACTURING CORPORATION
G.R. No. 195549, September 3, 2014
The concept of "unfair competition" under Article 28 is very much broader than that covered by
intellectual property laws. 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."
Geluz vs CA, July 20, 1961
It is unquestionable that the appellants act in provoking the abortion of appellees wife, without
medical necessity to warrant it, was a criminal and morally reprehensible act, that cannot be to
severely condemned; and the consent of the woman or that of her husband does not excuse it. But
the immorality or illegality of the act does not justify an award of damage that, under the
circumstances on record, have no factual or legal basis.
Quimiguing vs ICAO, 34 SCRA 132 (1970
A conceived child, although as yet unborn, is given by law a provisional personality of its own for
all purposes favorable to it, as explicitly provided under article 40 of the civil code.
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Cario v. Cario, G.R. NO. 132529 , Feb. 02, 2001 351 SCRA 127
Whether or not the certification by the registrar of the non-existence of marriage license is
enough to prove non-issuance thereof. The records reveal that the marriage contract of petitioner
and the deceased bears no marriage license number and, as certified by the Local Civil Registrar
of San Juan, Metro Manila, their office has no record of such marriage license.
Alcantara v. Alcantara, G.R. NO. 167746 , Aug. 28,2007 531 SCRA 446
Whether or not, a marriage license issued by a municipality or city to a non-resident invalidates
the license. Issuance of a marriage license in a city or municipality, not the residence of either of
the contracting parties, and issuance of a marriage license despite the absence of publication or
prior to the completion of the 10-day period for publication are considered mere irregularities
that do not affect the validity of the marriage
Nial vs. Bayadog 328 SCRA 122, March 14, 2000
In this case, at the time of Pepito and respondents marriage, it cannot be said that they have lived
with each other as husband and wife for at least five years prior to their wedding day because their
cohabitation is not exclusive. The Court ruled that the cohabitation contemplated under said
provisions must be in the nature of a perfect union that is valid under the law but rendered
imperfect only by the absence of the marriage contract and characterized by exclusivity
meaning nothird party was involved at anytime within the 5 years andcontinuity that is unbroken.
Soriano v. Felix, L-9005, June 20, 1958
The affidavit is for the purpose of proving the basis for exemption from the marriage license. Even
if there is failure on the part of the solemnizing officer to execute the necessary affidavit, such
irregularity will not invalidate the marriage for the affidavit is not being required of the parties.
Morigo v. People, G.R. NO. 145226 , Feb. 6, 200
The mere private act of signing a marriage contract bears no semblance to a valid marriage and
thus, needs no judicial declaration of nullity. Such act alone, without more, cannot be deemed to
constitute an ostensibly valid marriage for which petitioner might be held liable for bigamy unless
he first secures a judicial declaration of nullity before he contracts a subsequent marriage.
MINORU FUJIKI v. MARIA PAZ GALELA MARINAY, G.R. No. 196049, June 26, 2013
The Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable
Marriages (A.M. No. 02-11-10-SC) does not apply in a petition to recognize a foreign judgment
relating to the status of a marriage where one of the parties is a citizen of a foreign country.
REPUBLIC OF THE PHILIPPINES v. LIBERTY D. ALBIOS, G.R. No. 198780. October 16, 2013
A marriage, contracted for the sole purpose of acquiring American citizenship is NOT void ab
initio on the ground of lack of consent. Under Article 2 of the Family Code, consent is an essential
requisite of marriage. Article 4 of the same Code provides that the absence of any essential
requisite shall render a marriage void ab initio. Under said Article 2, for consent to be valid, it
must be (1) freely given and (2) made in the presence of a solemnizing officer. A "freely given"
consent requires that the contracting parties willingly and deliberately enter into the marriage.
Consent must be real in the sense that it is not vitiated nor rendered defective by any of the vices
of consent under Articles 45 and 46 of the Family Code, such as fraud, force, intimidation, and
undue influence. Consent must also be conscious or intelligent, in that the parties must be capable
of intelligently understanding the nature of, and both the beneficial or unfavorable consequences
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of their act. Their understanding should not be affected by insanity, intoxication, drugs, or
hypnotism.
Juliano-Llave v. Republic, G.R. NO. 169766 , Mar. 30, 2011 646 SCRA 637
The marriage between the late Sen. Tamano and Zorayda was celebrated in 1958, solemnized
under civil and Muslim rites. The only law in force governing marriage relationships between
Muslims and non-Muslims alike was the Civil Code of 1950, under the provisions of which only one
marriage can exist at any given time.
Pilapil vs. Ibay-Somera, G.R. NO. 80116 June 30, 1989
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
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.
Rep. v. Orbecido, G.R. NO. 154380, Oct. 05, 2005
Whether or not, a Filipino Spouse can remarry under ARTICLE 26 OF THE FAMILY CODE where
his,her spouse is later naturalized as a foreign citizen and obtains a valid divorce decree
capacitating him or 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
In Gerberts case, since both the foreign divorce decree and the national law of the alien,
recognizing his or her capacity to obtain a divorce, purport to be official acts of a sovereign
authority, Section 24, Rule 132 of the Rules of Court comes into play. This Section requires proof,
either by (1) official publications or (2) copies attested by the officer having legal custody of the
documents. If the copies of official records are not kept in the Philippines, these must be (a)
accompanied by a certificate issued by the proper diplomatic or consular officer in the Philippine
foreign service stationed in the foreign country in which the record is kept and (b) authenticated
by the seal of his office.
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.
Chi Ming Tsoi vs CA, 266 SCRA 324 (1997)
In this case, there was no sexual contact between the parties since their marriage on May 22, 1988
up to Mar. 15, 1989 or for almost a year. The senseless and protracted refusal of one of the parties
of sexual cooperation for the procreation of children is equivalent to psychological incapacity.
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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 Bonas 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.
REPUBLIC OF THE PHILIPPINES v. RODOLFO O. DE GRACIA G.R. No. 171577, February 12, 2014
Psychological incapacity, as a ground to nullify a marriage under Article 36of the Family Code,
should refer to no less than a mental not merely physical incapacity that causes a party to
be truly incognitive of the basic marital covenants that concomitantly must be assumed and
discharged by the parties to the marriage which, as so expressed in Article 68 of the Family Code,
among others, include their mutual obligations to live together, observe love, respect and fidelity
and render help and support. There is hardly any doubt that the intendment of the law has been to
confine the meaning of psychological incapacity to the most serious cases of personality
disorders clearly demonstrative of an utter insensitivity or inability to give meaning and
significance to the marriage.
Mendoza v. Republic, G.R. NO. 157649,Nov 12, 2012 685 SCRA 16
Here, the experts testimony on Dominics psychological profile did not identify, much less prove,
the root cause of his psychological incapacity because said expert did not examine Dominic in
person before completing her report but simply relied on other peoples recollection and opinion
for that purpose. Expert evidence 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.
Marcos vs Marcos, 343 SCRA 755 (2000)
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.
VALERIO E. KALAWvs. MA. ELENA FERNANDEZ
G.R. No. 166357, January 14, 2015
Lest it be misunderstood, we are not suggesting the abandonment of Molina in this case. We
simply declare that, as aptly stated by Justice Dante O. Tinga in Antonio v. Reyes, there is need to
emphasize other perspectives as well which should govern the disposition of petitions for
declaration of nullity under Article 36. At the risk of being redundant, we reiterate once more the
principle that each case must be judged, not on the basis of a priori assumptions, predilections or
generalizations but according to its own facts. And, to repeat for emphasis, courts should 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.
Tenebro v. CA, G.R. NO. 150758 , Feb. 18, 2004 423 SCRA 272
Whether or not, the nullity of the second marriage on the ground of PI is a valid defense for the
crime of bigamy. The declaration of the nullity of the second marriage on the ground of
psychological incapacity is not an indicator that petitioners marriage to Ancajas lacks the
essential requisites for validity.
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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.
Dewara v. Lamela G.R. NO. 179010, Apr. 11, 2011 647 SCRA 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.
BOBBY TAN, v.GRACE ANDRADE, ET AL. v. BOBBY TAN, G.R. No. 172017 / G.R. No. 171904
August 7, 2013
The presumption under Article 160 of the New Civil Code, that property acquired during marriage
is conjugal, does not apply where there is no showing as to when the property alleged to be
conjugal was acquired. The presumption cannot prevail when the title is in the name of only one
spouse and the rights of innocent third parties are involved. Moreover, when the property is
registered in the name of only one spouse and there is no showing as to when the property was
acquired by same spouse, this is an indication that the property belongs exclusively to the said
spouse. Moreover, the presumption may be rebutted only with strong, clear, categorical and
convincing evidence. There must be strict proof of the exclusive ownership of one of the spouses,
and the burden of proof rests upon the party asserting it.
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.
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 owner- spouse.
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.
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.
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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, whichonly shows that income tax has been paid and the
amount thereof.
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.
DE LA CRUZ v. GRACIA, G.R. No. 177728, July 31, 2009
1) 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; and
2) 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.
GRACE M. GRANDE v. PATRICIO T. ANTONIO, G.R. No. 206248. February 18, 2014
An illegitimate child may use the surname of his father if the latter has expressly recognized their
filiation. However, the child is under no compulsion to use his fathers surname. When Antonio
recognized Andre Lewis and Jerard Patrick as his sons, the two children had the right to use the
surname of Antonio. However, they were under no compulsion or mandate to use the same. The
law uses the word may, which dictates that it is merely permissive.
Tonog vs. CA, G.R. NO. 122906 , Feb. 07, 2002 376 SCRA 523
In the case at bar, bearing in mind that the welfare of the said minor as the controlling factor, the
appellate court did not err in allowing her father to retain in the meantime parental custody over
her. Meanwhile, the child should not be wrenched from her familiar surroundings, and thrust into
a strange environment away from the people and places to which she had apparently formed an
attachment.
Abadilla vs. Tabiliran, Jr. A.M NO. MTJ-92-716, Oct. 25, 1995 249 SCRA 447
Whether or not, a child born out of wedlock, by parents who have a legalimpediment to marry
each other, can be legitimated. As a lawyer and a judge, respondent ought to know that, despite
his subsequent marriage to Priscilla, these three children cannot be legitimated nor in any way be
considered legitimate since at the time they were born, there was an existing valid marriage
between respondent and his first wife, Teresita B. Tabiliran.
ROSARIO MATA CASTRO AND JOANNE BENEDICTA CHARISSIMA M. CASTRO, A.K.A. MARIA
SOCORRO M. CASTRO AND JAYROSE M. CASTRO vs JOSE MARIA JED LEMUEL GREGORIO
AND ANA MARIA REGINA GREGORIO
G.R. NO. 188801, 15 October 2014, SECOND DIVISION (Leonen, J.)
For the adoption to be valid, petitioners' consent was required by Republic Act No. 8552. Personal
service of summons should have been effected on the spouse and all legitimate children to ensure
that their substantive rights are protected. It is not enough to rely on constructive notice as in this
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case. Surreptitious use of procedural technicalities cannot be privileged over substantive statutory
rights.
In re: Adoption of Michelle & Michael Lim G.R. NO.168992-93, May 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.
Gan vs. Reyes, G.R. NO.145527, May.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 inorder 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.
Laxamana v. Laxamana, G.R. NO. 144763, Sept. 3, 2002 388 SCRA 296
It is clear that every child [has] rights which are not and should not be dependent solely on the
wishes, much less the whims and caprices, of his parents. His welfare should not be subject to the
parents' say-so or mutual agreement alone. Where, as in this case, the parents are already
separated in fact, the courts must step in to determine in whose custody the child can better be
assured the rights granted to him by law. The need, therefore, to present evidence regarding this
matter, becomes imperative.
St. Marys Academy v. Carpitanos, G.R. NO. 143363, Feb. 6, 2002 376 SCRA 473
The liability for the accident, whether caused by the negligence of the minor driver or mechanical
detachment of the steering wheel guide of the jeep, must be pinned on the minors parents
primarily. The negligence of petitioner St. Marys Academy was only a remote cause of the
accident.
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 mother, as the natural guardian of the minor under parental authority, does not have the
power to dispose or encumber the property of the latter.
FE FLORO VALINO vs. ROSARIO D. ADRIANO, FLORANTE D. ADRIANO, RUBEN D. ADRIANO,
MARIA TERESA ADRIANO ONGOCO, VICTORIA ADRIANO BAYONA, AND LEAH ANTONETTE D.
ADRIANO
G.R. No. 182894, 22 April 2014, EN BANC (Mendoza J.)
The law gives the right and duty to make funeral arrangements to Rosario, she being the surviving
legal wife of Atty. Adriano. The fact that she was living separately from her husband and was in the
United States when he died has no controlling significance. To say that Rosario had, in effect,
waived or renounced, expressly or impliedly, her right and duty to make arrangements for the
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funeral of her deceased husband is baseless. The right and duty to make funeral arrangements,
like any other right, will not be considered as having been waived or renounced, except upon
clear and satisfactory proof of conduct indicative of a free and voluntary intent to that end.
It is generally recognized that the corpse of an individual is outside the commerce of man.
However, the law recognizes that a certain right of possession over the corpse exists, for the
purpose of a decent burial, and for the exclusion of the intrusion by third persons who have no
legitimate interest in it. This quasi-property right, arising out of the duty of those obligated by law
to bury their dead, also authorizes them to take possession of the dead body for purposes of burial
to have it remain in its final resting place, or to even transfer it to a proper place where the
memory of the dead may receive the respect of the living. This is a family right. There can be no
doubt that persons having this right may recover the corpse from third persons.
DR. FILOTEO A. ALANO vs. ZENAIDA MAGUD-LOGMAO, G.R. No. 175540, 14 April 2014
There can be no cavil that petitioner 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 allowed for notices to reach the relatives of the deceased.
PROPERTY
Laurel vs. Abrogar, G.R. NO. 155076, Jan. 13, 2009
International telephone calls placed by Bay Super Orient Card holders, the telecommunication
services provided by PLDT and its business of providing said services are not personal properties
under Article 308 of the Revised Penal Code. The construction by the respondents of Article 308
of the said Code to include, within its coverage, the aforesaid international telephone calls,
telecommunication services and business is contrary to the letter and intent of the law.
Tsai vs. CA, 366 SCRA 324
In the instant case, the parties: (1) executed a contract styled as Real Estate Mortgage and
Chattel Mortgage, instead of just Real Estate Mortgage if indeed their intention is to treat all
properties included therein as immovable, and (2) attached to the said contract a separate LIST
OF MACHINERIES & EQUIPMENT. These facts, taken together, evince the conclusion that the
parties intention is to treat these units of machinery as chattels.
Caltex Phils., Inc., vs. CBAA, May 31, 1982
SC held that the said equipment and machinery, as appurtenances to the gas station building or
shed owned by Caltex (as to which it is subject to realty tax) and which fixtures are necessary to
the operation of the gas station, for without them the gas station would be useless, and which
have been attached or affixed permanently to the gas station site or embedded therein, are
taxable improvements and machinery within the meaning of the Assessment Law and the Real
Property Tax Code.
MERALCO vs. CBAA, May 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 degree of permanence as
receptacles for the considerable quantities of oil needed by Meralco for its operations.
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intent of Article 448 is to avoid a state of forced co-ownership and that the parties, including the
two courts below, in the main agree that Articles 448 and 546 of the Civil Code are applicable and
indemnity for the improvements may be paid although they differ as to the basis of the indemnity.
Vda. de Nazareno v. CA, 257 SCRA 598 (1996)
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.
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.
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.
Bahais v. Pascual, G.R. 169272,July 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 been 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.
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.
Santos v. Heirs of Lustre, G.R. NO. 151016, Aug. 06, 2008
Any adverse ruling in the earlier case will not, in any way, prejudice the heirs who did not join,
even if such case was actually filed in behalf of all the co-owners. In fact, if an action for recovery
of property is dismissed, a subsequent action by a co- heir who did not join the earlier case should
not be barred by prior judgment.
Rey Castigador Catedrilla v. Mario and Margie Lauron, G.R. No. 179011. April 15, 2013
In suits to recover properties, all co-owners are real parties in interest. However, pursuant to
Article 487 of the Civil Code and the relevant jurisprudence, any one of them may bring an action,
any kind of action for the recovery of co-owned properties. Therefore, only one of the co-owners,
namely the co-owner who filed the suit for the recovery of the co-owned property, is an
indispensable party thereto. The other co-owners are not indispensable parties. They are not even
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necessary parties, for a complete relief can be afforded in the suit even without their
participation, since the suit is presumed to have been filed for the benefit of all co-owners.
VIRGINIA Y. GOCHAN, FELIX Y. GOCHAN III, LOUISE Y. GOCHAN, ESTEBAN Y. GOCHAN, JR.,
and DOMINIC Y. GOCHAN v. CHARLES MANCAO, G.R. No. 182314, November 13, 2013
Only the redeeming co-owner and the buyer are the indispensable parties in an action for legal
redemption, to the exclusion of the seller/co-owner A party who is not the co-owner of a land
subject of a compromise agreement cannot claim that he was defrauded when the parties in the
compromise agreement entered into the same. As a third party to the agreement, he is not
indispensable for the agreement to materialize.
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.
Bunyi v. Factor, G.R. NO. 172547, Jun. 30, 2009 591 SCRA 350
For one to be considered in possession, one need not have actual or physical occupation of every
square inch of the property at all times. Possession can be acquired not only by material
occupation, but also by the fact that a thing is subject to the action of ones will or by the proper
acts and legal formalities established for acquiring such right, possession can be acquired by
juridical acts.
EDCA Publ. V. Santos, G.R. NO. 80298, Apr. 26, 1990 184 SCRA 614
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.
PILAR DEVELOPMENT CORPORATION v. RAMON DUMADAG, ET. AL., G.R. No. 194336, March
11, 2013
Squatters have no possessory rights over the land intruded upon. The length of time that they may
have physically occupied the land is immaterial; they are deemed to have entered the same in bad
faith, such that the nature of their possession is presumed to have retained the same character
throughout their occupancy.
Quintanilla v. Abangan, G.R. NO. 160613, Feb.12, 2008
As between a right of way that would demolish a fence of strong materials to provide ingress and
egress to a public highway and another right of way which although longer will only require a van
or vehicle to make a turn, the second alternative should be preferred. Mere convenience for the
dominant estate is not what is required by law as the basis for setting up a compulsory easement.
Reyes v. Ramos, G.R. No. 194488, February 11, 2015
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.
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Hidalgo Enterprises v. Balandan, et. al, G.R. No. L-3422 Jun. 13, 1952
Nature has created streams, lakes and pools which attract children. Lurking in their waters is
always the danger of drowning. Against this danger children are early instructed so that they are
sufficiently presumed to know the danger; and if the owner of private property creates an artificial
pool on his own property, merely duplicating the work of nature without adding any new danger, .
. . (he) is not liable because of having created an "attractive nuisance."
Gancayco v. Quezon City, G.R. NO. 177807,Oct 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.
SMART COMMUNICATIONS, INC., v. ARSENIO ALDECOA, ET. AL., G.R. No. 166330, September
11, 2013
Commercial and industrial activities which are lawful in themselves may become nuisances if they
are so offensive to the senses that they render the enjoyment of life and property uncomfortable.
The fact that the cause of the complaint must be substantial has often led to expressions in the
opinions that to be a nuisance the noise must be deafening or loud or excessive and unreasonable.
The determining factor when noise alone is the cause of complaint is not its intensity or volume. It
is that the noise is of such character as to produce actual physical discomfort and annoyance to a
person of ordinary sensibilities, rendering adjacent property less comfortable and valuable. If the
noise does that it can well be said to be substantial and unreasonable in degree, and
reasonableness is a question of fact dependent upon all the circumstances and conditions. There
can be no fixed standard as to what kind of noise constitutes a nuisance.
Republic v. Guzman, G.R. No. 132964, February 18, 2000
The donation is null and void when (a) the deed of donation fails to show the acceptance, or (b)
where the formal notice of the acceptance made in 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.
Quijada vs. CA, G.R. NO. 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
to the donor's knowledge - that ownership of the donated property reverted to the donor as
provided in the automatic reversion clause of the deed of donation.
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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.
Adriana Maloto vs. CA, 158 SCRA 451
For one, the document or papers burned by Adriana's maid, Guadalupe, was not satisfactorily
established to be a will at all, much less the will of Adriana Maloto. For another, the burning was
not proven to have been done under the express direction of Adriana. And then, the burning was
not in her presence.
Gago vs. Mamuyac NO. L-26317, 49 Phil 902
Where a will which cannot be found is shown to have been in the possession of the testator, when
last seen, the presumption is, in the absence of other competent evidence, that the same was
cancelled or destroyed. The same presumption arises where it is shown that the testator had ready
access to the will and it cannot be found after his death. It will not be presumed that such will has
been destroyed by any other person without the knowledge or authority of the testator.
Seangio v. Reyes, 2006 508 SCRA 172
For disinheritance to be valid, Article 916 of the Civil Code requires that the same must be
effected through a will wherein the legal cause therefor shall be specified. With regard to the
reasons for the disinheritance that were stated by Segundo in his document, the Court believes
that the incidents, taken as a whole, can be considered a form of maltreatment of Segundo by his
son, Alfredo, and that the matter presents a sufficient cause for the disinheritance of a child or
descendant under Article 919 of the Civil Code.
Molo vs. Molo NO. L- 2538, 90 Phil 37
The failure of a new testamentary disposition upon whose validity the revocation depends, is
equivalent to the non-fulfillment of a suspensive conditions, and hence prevents the revocation of
the original will. But a mere intent to make at some time a will in the place of that destroyed will
not render the destruction conditional.
Gan vs Yap, 104 Phil. 509
The loss of the holographic will entail the loss of the only medium of proof; if the ordinary will is
lost, the subscribing witnesses are available to authenticate. In case of holographic will if oral
testimony were admissible only one man could engineer the fraud this way.
Rodelas vs Aranza 119 SCRA 16
If the holographic will has been lost or destroyed and no other copy is available, the will cannot be
probated because the best and only evidence is the handwriting of the testator. But a photostatic
copy or Xerox copy of the holographic will may be allowed because comparison can be made with
the standard writings of the testator.
Azaola vs Singson 109 Phil. 102
Since the authenticity of the will was not contested, the appellant is not required to produce more
than one witness. Even if the genuiness of the holographic will were contested, article 811 cannot
be interpreted as to require the compulsory presentation of three witnesses to identify the
handwriting of the testator, under penalty of having denied the probate.
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her husband as their own son, reared from infancy, educated and trained in their businesses, and
eventually legally adopted by decedents husband, the original oppositor to respondents petition
for letters of administration.
Diaz vs. IAC, 150 SCRA 645
It is therefore clear from Article 992 of the New Civil Code that the phrase "legitimate children
and relatives of his father or mother" includes Simona Pamuti Vda. de Santero as the word
"relative" includes all the kindred of the person spoken of. The record shows that from the
commencement of this case the only parties who claimed to be the legitimate heirs of the late
Simona Pamuti Vda. de Santero are Felisa Pamuti Jardin and the six minor natural or illegitimate
children of Pablo Santero.
Diaz vs. IAC, 182 SCRA 427
The term relatives, although used many times in the Code, is not defined by it. In accordance
therefore with the canons of statutory interpretation, it should be understood to have a general
and inclusive scope, inasmuch as the term is a general one.
Heirs of Uriarte vs. CA, 284 SCRA 511
A nephew is considered a collateral relative who may inherit if no descendant, ascendant, or
spouse survive the decedent. That private respondent is only a half-blood relative is immaterial.
Delos Santos vs Ferraris-Borromeo, 14 SCRA 986
Nephews and nieces alone do not inherit by right of representation unless concurring with the
brothers or sisters of the deceased which is provided in article 975 when children of one or more
brothers or sisters of the deceased survive with their uncles and aunts but if they alone survive,
they shall inherit in equal portions.
OBLIGATIONS AND CONTRACTS
DEGAOS vs. PEOPLE OF THE PHILIPPINES, G.R. NO. 162826, October 14, 2013
Degaos claims that his partial payments to the complainants novated his contract with them
from agency to loan, thereby converting his liability from criminal to civil. The incompatibility in
novation must take place in any of the essential elements of the obligation, such as its object,
cause or principal conditions thereof; otherwise, the change would be merely modificatory in
nature and insufficient to extinguish the original obligation.
BPI EXPRESS CARD CORPORATION vs. MA. ANTONIA R. ARMOVIT
G.R. No. 163654, 08 October 2014, FIRST DIVISION (BERSAMIN, J.)
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.
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FIL-ESTATE PROPERTIES, INC. AND FIL-ESTATE NETWORK, INC., v. SPOUSES CONRADO AND
MARIA VICTORIA RONQUILLO, , G.R. NO.185798. January 13, 2014
The 1997 Asian Financial Crisis cannot be said to be unforeseeable and beyond the control of a
business corporation, especially a corporation engaged in real estate enterprise. Such corporation
is considered a master in projections of commodities and currency movements and business risks.
It has the ability to foresee such situation. Thus, the 1997 Asian Financial Crisis is not an instance
of caso fortuito.
ANSAY vs. BOARD OF DIRECTORS, G.R. NO. L-13667, April 29, 1960
Appellants filed against appellees in the CFI a complaint praying for a 20% Christmas bonus,
contending that there exists a cause of action in their complaint because their claim rests on
moral grounds or what in brief is defined by law as a natural obligation. Article 1423 of the New
Civil Code classifies obligations into civil or natural, "Civil obligations are a right of action to
compel their performance, while Natural obligations, not being based on positive law but on
equity and natural law, do not grant a right of action to enforce their performance, but after
voluntary fulfillment by the obligor, they authorize the retention of what has been delivered or
rendered by reason thereof".
SALEN vs. BALCE, G.R. NO. L-14414, April 27, 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" .
SALUDAGA vs. FEU, G.R. NO. 179337 April 30, 2008
Saludaga, a sophomore law student of respondent FEU filed a case for damages against it after he
was shot by one of the security guards on duty at the school premises. When an academic
institution accepts students for enrollment, there is a established contract between them,
resulting in bilateral obligations which both parties are bound to comply with but which FEU
failed to perform when it did not provide a safe and secure environment to its students.
NAPOCOR vs. CA, G.R. NO. 124378, March 8, 2005
The negligence of NPC as a result of its inability to maintain the level of water in its dams has been
satisfactorily and extensively established. In crimes and quasi-delicts, the defendant shall be liable
for all damages, which are the natural and probable consequences of the act or omission
complained of and it is not necessary that such damages have been foreseen or could have
reasonably been foreseen by the defendant.
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. If the obligation is generic in the sense that the object thereof is designated merely by its
class or genus without any particular designation or physical segregation from all others of the
same class, the loss or destruction of anything of the same kind even without the debtors fault
and before he has incurred in delay will not have the effect of extinguishing the obligation, based
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on the principle 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.
TELEFAST 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 telegram but which petitioner
did not do, despite performance by said private respondent of her obligation by paying the
required charges. Those who in the performance of their obligations are guilty of fraud,
negligence or delay, and those who in any manner contravene the tenor thereof, are liable for
damages.
MANUEL vs. CA, G.R. NO. 95469 July 25, 1991
Petitioner contends that private respondents are in mora accipiendi. The failure of the owners to
collect or their refusal to accept the rentals are not valid defenses, since consignation under such
circumstances, is necessary, and by this we mean one that is effected in full compliance with the
specific requirements of the law therefor.
UNLAD RESOURCES DEVELOPMENT CORPORATION vs. DRAGON, G.R. NO. 149338, July 28,
2008
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.
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.
JAVIER vs. CA, G.R. No. L-48194 March 15, 1990
When a contract is subject to a suspensive condition, its birth and effectivity can take place only if
and when the event which constitutes the condition happens or is fulfilled, and if the suspensive
condition does not take place, the parties would stand as if the conditional obligation had never
existed.
PARKS vs. PROVINCE OF TARLAC, G.R. NO. L-24190, July 13, 1926
Appellant contends that a condition precedent having been imposed in the donation and the
same not having been complied with, the donation never became effective. The characteristic of a
condition precedent is that the acquisition of the right is not effected while said condition is not
complied with or is not deemed complied with, consequently, when a condition is imposed, the
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compliance of which cannot be effected except when the right is deemed acquired, such
condition cannot be a condition precedent but a condition subsequent.
ALILEO A. MAGLASANG v. NORTHWESTERN UNIVERSITY, INC., G.R. No. 188986, March 20,
2013
The court ruled that the power to rescind the obligations of the injured party is implied in
reciprocal obligations, such as in this case. On this score, the CA correctly applied Article 1191,
which provides thus: the power to rescind obligations is implied in reciprocal ones, in case one of
the obligors should not comply with what is incumbent upon him. The injured party may choose
between the fulfillment and the rescission of the obligation, with the payment of damages in
either case. He may also seek rescission, even after he has chosen fulfillment, if the latter should
become impossible. The court shall decree the rescission claimed, unless there be just cause
authorizing the fixing of a period.
EDS MANUFACTURING, INC.v. HEALTHCHECK INTERNATIONAL INC. G.R. No. 162802, October
9, 2013
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 violations as would defeat the very object of the
parties in making the agreement. It must be pointed that in the absence of a stipulation, a party
cannot unilaterally and extra judicially rescind a contract. A judicial or notarial act is necessary
before a valid rescission can take place.
Even if Article 1191 were applicable, petitioner would still not be entitled to automatic rescission.
Under Article 1191of the Civil Code, the right to resolve reciprocal obligations, is deemed implied
in case one of the obligors shall fail to comply with what is incumbent upon him. But that right
must be invoked judicially. Consequently, even if the right to rescind is made available to the
injured party, the obligation is not ipso facto erased by the failure of the other party to comply
with what is incumbent upon him. The party entitled to rescind should apply to the court for a
decree of rescission. The right cannot be exercised solely on a partys own judgment that the other
committed a breach of the obligation. The operative act which produces the resolution of the
contract is the decree of the court and not the mere act of the vendor.
UP vs. DE LOS ANGELES, G.R. NO. L-28602, September 29,
In the first place, UP and ALUMCO had expressly stipulated in the "Acknowledgment of Debt and
Proposed Manner of Payments" that, upon default by the debtor ALUMCO, the creditor (UP) has
"the right and the power to consider, the Logging Agreement dated as rescinded without the
necessity of any judicial suit."
The party who deems the contract violated may consider it resolved or rescinded, and act
accordingly, without previous court action, but it proceeds at its own risk, for it is only the final
judgment of the corresponding court that will conclusively and finally settle whether the action
taken was or was not correct in law.
AYSON-SIMON vs. ADAMOS, G.R. NO. L-39378, August 28, 1984
Defendants contend (1) that the fulfillment and the rescission of the obligation in reciprocal ones
are alternative remedies, and plaintiff having chosen fulfillment in the Civil Case, she cannot now
seek rescission; and (2) that even if plaintiff could seek rescission the action to rescind the
obligation has prescribed. The rule that the injured party can only choose between fulfillment and
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rescission of the obligation, and cannot have both, applies when the obligation is possible of
fulfillment, if the fulfillment has become impossible, Article 1191 (3) allows the injured party to
seek rescission even after he has chosen fulfillment.
OSMEA III vs SSS, September 13, 2007
The Letter-Agreement, the SPA, the SSC resolutions assailed in this recourse, and the Invitation to
Bid sent out to implement said resolutions, all have a common subject: the Shares the 187.84
Million EPCIB common shares, which, as a necessary consequence of the BDO- EPCIB merger
which saw EPCIB being absorbed by the surviving BDO, have been transferred to BDO and
converted into BDO common shares under the exchange ratio set forth in the BDO-EPCIB Plan of
Merger. As thus converted, the subject Shares are no longer equity security issuances of the now
defunct EPCIB, but those of BDO-EPCI, which, needless to stress, is a totally separate and distinct
entity from what used to be EPCIB.
Under the law on obligations and contracts, the obligation to give a determinate thing is
extinguished if the object is lost without the fault of the debtor, and per Art. 1192 (2) of the Civil
Code, a thing is considered lost when it perishes or disappears in such a way that it cannot be
recovered.
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 complaint not having sought
that the court should set a period, but must set the time that the parties are shown to have
intended.
RONQUILLO vs.CA, G.R. NO. L-55138September 28, 1984
Respondent filed a modification of the order of the lower court in a collection case praying for the
"execution of the decision in its entirety against all defendants, jointly and severally." In the
absence of a finding of facts that the defendants made themselves individually liable for the debt
incurred they are each liable only for one-fourth of said amount, the obligation being described as
"individually and jointly".
SPOUSES MINIAN0 vs. CONCEPCION, G.R. 172825, October 11, 2012
Admittedly, payment of the remaining balance of P200,000.00 was not made to the creditors
themselves, but rather, it was allegedly made to a certain Losloso who was the authorized agent of
petitioners. Respondents obligation consists of payment of a sum of money, and in general, a
payment in order to be effective to discharge an obligation, must be made to the proper person,
thus, payment must be made to the obligee himself or to an agent having authority, express or
implied, to receive the particular payment. Payment made to one having apparent authority to
receive the money will, as a rule, be treated as though actual authority had been given for its
receipt. If payment is made to one who by law is authorized to act for the creditor, it will work as a
discharge.
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the old, changes only the terms of payment, and adds other obligations not incompatible with the
old ones, or where the new contract merely supplements the old one.
SPOUSES TONGSON vs. EMERGENCY PAWNSHOP BULA, G.R. 167874. January 15, 2010
A valid contract requires the concurrence of the following essential elements: (1) consent or
meeting of the minds, that is, consent to transfer ownership in exchange for the price; (2)
determinate subject matter; and (3) price certain in money or its equivalent.
PALATTAO vs. CA, G.R. NO. 131726, May 7, 2002
Appellant made a qualified acceptance of appellees letter-offer of a parcel of land but appellee
made a new proposal to pay the amount in staggered amounts within two years in quarterly
amortizations. To convert the offer into a contract, the acceptance must be absolute and must not
qualify the terms of the offer, for a qualified acceptance constitutes a counter-offer and is a
rejection of the original offer and such acceptance is not sufficient to generate consent.
GALLARDO vs.HONORABLE INTERMEDIATE APPELLATE COURT, G.R. NO. L-67742 October 29,
1987
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.
SANCHEZ vs. RIGOS, G.R. NO. L-25494 June 14, 1972
Since there may be no valid contract without a cause or consideration, the promisor is not bound
by his promise and may, accordingly, withdraw it, and pending notice of its withdrawal, his
accepted promise partakes, however, of the nature of an offer to sell which, if accepted, results in
a perfected contract of sale.
TIU vs. PLATINUM PLANS PHIL., INC., G.R. NO. 163512 February 28, 2007
Respondent contends that the inclusion of the two-year non-involvement clause in petitioners
contract of employment was reasonable and needed since her job gave her access to the
companys confidential marketing strategies. A non-involvement clause is not necessarily void for
being in restraint of trade as long as there are reasonable limitations as to time, trade, and place.
CABAHUG vs NAPOCOR, G.R. NO. 186069, January 30, 2013
Disregarding the stipulations in the contract allowing additional compensation for easement fee,
the CA ruled that Cabahug's attempt to collect further sums by way of additional easement fee
and,or just compensation is violative of said contract. It is settled that a contract constitutes the
law between the parties who are bound by its stipulations which, when couched in clear and plain
language, should be applied according to their literal tenor and the courts cannot supply material
stipulations, which contradict the intent of the parties.
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
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containing a condition which makes its fulfillment dependent exclusively upon the uncontrolled
will of one of the contracting parties, is void.
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 predecessors-in-interest except when the rights and
obligations arising therefrom are not transmissible by (1) their nature, (2) stipulation or (3)
provision of law.
PRUDENTIAL BANK AND TRUST COMPANY vs. ABASOLO, G.R. NO. 186738, September 27, 2010
Contracts take effect only between the parties, their assigns and heirs, and if a contract should
contain some stipulation in favor of a third person, the contracting parties must have clearly and
deliberately conferred a favor upon the third person.
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.
ASIAN CATHAY FINANCE AND LEASING CORPORATION vs. SPOUSES G.R.AVADOR et al, G.R.
NO. 186550, July 5, 2010
A contract of adhesion may be struck down as void and unenforceable for being subversive to
public policy, when the weaker party is completely deprived of the opportunity to bargain on
equal footing.
URETA vs. URETA, G.R. No. 165748, September 14, 2011
Lacking in an absolutely simulated contract is consent which is essential to a valid and enforceable
contract. Thus, where a person, in order to place his property beyond the reach of his creditors,
simulates a transfer of it to another, he does not really intend to divest himself of his title and
control of the property; hence, the deed of transfer is but a sham. Similarly, in this case, Alfonso
simulated a transfer to Policronio purely for taxation purposes, without intending to transfer
ownership over the subject lands.
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.
CARLOS A. LORIA vs. LUDOLFO P. MUOZ, JR.
G.R. No. 187240, 15 October 2014, SECOND DIVISION (Leonen, J.)
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.
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in money or its equivalent which are present in the second Deed of Sale hence there is already a
perfected contract of sale.
FIRST OPTIMA REALTY CORPORATIONvs. SECURITRON SECURITY SERVICES, INC.
G.R. No. 199648, January 28, 2015
Since there is no perfected sale between the parties, respondent had no obligation to make
payment through the check; nor did it possess the right to deliver earnest money to petitioner in
order to bind the latter to a sale. As contemplated under Art. 1482 of the Civil Code, there must
first be a perfected contract of sale before we can speak of earnest money. Where the parties
merely exchanged offers and counter-offers, no contract is perfected since they did not yet give
their consent to such offers. Earnest money applies to a perfected sale.
MOLDEX RAELTY INC. v. FLORA A. SABERON, G.R. No. 176289. April 8, 2013
The lack of a license to sell or the failure on the part of a subdivision developer to register the
contract to sell or deed of conveyance with the Register of Deeds does not result to the
nullification or invalidation of the contract to sell it entered into with a buyer. The contract to sell
remains valid and subsisting. The intrinsic validity of the contract to sell is not affected by the
developers violation of Section 5 of PD 957.Nevertheless, the respondent in this case is entitled
to 50% refund under the Maceda Law.
SPOUSES DELFIN O. TUMIBAY AND AURORA T. TUMIBA-DECEASED ET AL. v. SPOUSES MELVIN
A. LOPEZ, G.R. No. 171692, June 3, 2013
In a contract to sell, the seller retains ownership of the property until the buyer has paid the price
in full. A buyer who covertly usurps the seller's ownership of the property prior to the full payment
of the price is in breach of the contract and the seller is entitled to rescission because the breach is
substantial and fundamental as it defeats the very object of the parties in entering into the
contract to sell. In the case at bar, the court finds that respondent Rowenas act of transferring the
title to the subject land in her name, without the knowledge and consent of petitioners and
despite non-payment of the full price thereof, constitutes a substantial and fundamental breach
of the contract to sell.
HEIRS OF ARTURO REYES vs SOCCO-BELTRAN, G.R. 176474 November 27, 2008
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. MACAHILIG 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 even subject to prescription, since the deed of sale
that was executed in favor of petitioners was null and void because the seller 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.
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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.
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. MTJ-89-270 July 5, 1993
OFFICE OF THE COURT ADMINISTRATOR vs. JUDGE PAGOROGON, A.M. NO. MTJ-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.
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 only 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 March 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
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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.
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.
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.
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.
JAVIER vs. COURT OF APPEALS, G.R. NO. L-48194 March 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.
DEL PRADO vs SPOUSES CABALLERO, G.R. NO. 148225, March 3,2010 7
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
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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.
SEMIRA vs. COURT OF APPEALS, G.R. NO. 76031 March 2, 1994
Private respondent sold Lot 4221 to his nephew by means of a "Kasulatan ng Bilihan ng Lupa"
which incorporated both the area and the definite boundaries of the lot, the former transferred
not merely the 822.5 square meters stated in their document of sale but the entire area
circumscribed within its boundaries.
If besides mentioning the boundaries, which is indispensable in every conveyance of real estate,
its area or number should be designated in the contract, the vendor shall be bound to deliver all
that is included within said boundaries, even when it exceeds the area or number specified in the
contract; and, should he not be able to do so, he shall suffer a reduction in the price, in proportion
to what is lacking in the area or number, unless the contract is rescinded because the vendee does
not accede to the failure to deliver what has been stipulated.
DANGUILAN vs. IAC, G.R. NO. L-69970 November 28, 1988
Respondent admits that she did not take physical possession of property but argues that symbolic
delivery was effected through the notarized deed of sale. The thing is considered to be delivered
when it is placed "in the hands and possession of the vendee," and in order that this symbolic
delivery may produce the effect of tradition, it is necessary that the vendor shall have had such
control over the thing sold at the moment of the sale, but if there is no impediment to prevent the
thing sold passing into the tenancy of the purchaser by the sole will of the vendor, symbolic
delivery through the execution of a public instrument is sufficient.
CHUA vs COURT OF APPEALS, G.R. NO. 119255, April 9, 2003
Petitioner insists that he was ready to pay the balance of the purchase price but withheld payment
because he required that the property be registered first in his name before he would turn over
the check to the private respondent. 8
The obligation of the seller is to transfer to the buyer ownership of the thing sold, but in the sale
of a real property, the seller is not obligated to transfer in the name of the buyer a new certificate
of title, but rather to transfer ownership of the real property, because as between the seller and
buyer, ownership is transferred not by the issuance of a new certificate of title in the name of the
buyer but by the execution of the instrument of sale in a public document.
VISAYAN SAWMILL COMPANY, INC., vs. COURT OF APPEALS, G.R. NO. 83851. March 3, 1993.
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.
MUNICIPALITY OF VICTORIAS vs. THE COURT OF APPEALS, G.R. NO. L-31189 March 31, 1987
Respondent discovered that a parcel of land she owns is being used by Petitioner, Municipality of
Victorias, as a cemetery for 29 years and when the Mayor replied that Petitioner bought the land
from her grandmother, she asked to be shown the papers concerning the sale but petitioner
refused to show the same. Where there is no express provision that title shall not pass until
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payment of the price, and the thing sold has been delivered, title passes from the moment the
thing sold is placed in the possession and control of the buyer.
DE LEON vs. ONG, G.R. NO. 170405, February 2, 2010
Petitioner sold three parcels of land to respondent which were mortgaged to a bank, hence
petitioner and respondent executed a notarized deed of absolute sale with assumption of
mortgage, but petitioner some time thereafter paid the mortgage and sold the properties to
another person. Settled is the rule that the seller is obliged to transfer title over the properties
and deliver the same to the buyer, and as a rule, the execution of a notarized deed of sale is
equivalent to the delivery of a thing sold.
PUROMINES, INC., vs. COURT OF APPEAL, G.R. NO. 91228. March 22, 1993.
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, 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.
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.
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.
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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.
HYATT ELEVATORS vs. CATHEDRAL HEIGHTS, G.R. NO. 173881 December 1, 2010
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.
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.
FULE vs. COURT OF APPEALS, G.R. NO. 112212, March 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 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.
CENTRAL BANK OF THE PHILIPPINES vs. SPOUSES ALFONSO, G.R. NO. 131074, March 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.
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MANUEL UY & SONS, INC. v. VALBUECO, INCORPORATED, G.R. No. 179594. September 11,
2013
Articles 1191 and 1592 of the Civil Code are applicable to contracts of sale, while R.A. No. 6552
applies to contracts to sell. R.A. No. 6552, otherwise known as the Realty Installment Buyer Act,
applies to the subject contracts to sell. R.A. No. 6552 (Maceda Law) recognizes in conditional sales
of all kinds of real estate (industrial, commercial, residential) the right of the seller to cancel the
contract upon non-payment of an installment by the buyer, which is simply an event that prevents
the obligation of the vendor to convey title from acquiring binding force.
SPOUSES JAIME SEBASTIAN AND EVANGELINE SEBASTIAN vs. BPI FAMILY BANK, INC.,
CARMELITA ITAPO AND BENJAMIN HAO
G.R. No. 160107, 22 October 2014, FIRST DIVISION (Bersamin, J.)
The protection of Republic Act No. 6552 (Realty Installment Buyer Protection Act) does not cover
a loan extended by the employer to enable its employee to finance the purchase of a house and
lot. The law protects only a buyer acquiring the property by installment, not a borrower whose
rights are governed by the terms of the loan from the employer.
SPOUSES MICHELLE M. NOYNAY AND NOEL S. NOYNAY vs. CITIHOMES BUILDER AND
DEVELOPMENT, INC.
G.R. No. 204160, September 22, 2014
In Pagtalunan v. Manzano, the Court stressed the importance of complying with the provisions of
the Maceda Law as to the cancellation of contracts to sell involving realty installment schemes.
There it was held that the cancellation of the contract by the seller must be in accordance with
Section 3 (b) of the Maceda Law, which requires the notarial act of rescission and the refund to
the buyer of the full payment of the cash surrender value of the payments made on the property.
The actual cancellation of the contract takes place after thirty (30) days from receipt by the buyer
of the notice of cancellation or the demand for rescission of the contract by a notarial act and
upon full payment of the cash surrender value to the buyer.
SKUNAC CORPORATION AND ALFONSO F. ENRIQUEZ vs. ROBERTO S. SYLIANTENG AND
CAESAR S. SYLIANTENG
G.R. No. 205879, 23 April 2014, THIRD DIVISION (Peralta, J.)
The requisites that must concur for Article 1544 to apply are: (a) The two (or more sales)
transactions must constitute valid sales; (b) The two (or more) sales transactions must pertain to
exactly the same subject matter; (c) The two (or more) buyers at odds over the rightful ownership
of the subject matter must each represent conflicting interests; and (d) The two (or more)
buyers at odds over the rightful ownership of the subject matter must each have bought from
the very same seller.
Obviously, said provision has no application in cases where the sales involved were initiated not by
just one but two vendors.
SPOUSES CLEMENCIO C. SABITSANA, JR v. JUANITO F. MUERTEGUI, G.R. No. 181359 August 5,
2013
Article 1544 of the Civil Code does not apply to sales involving unregistered land. Suffice it to
state that the issue of the buyers good or bad faith is relevant only where the subject of the sale is
registered land, and the purchaser is buying the same from the registered owner whose title to the
land is clean. In such case, the purchaser who relies on the clean title of the registered owner is
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protected if he is a purchaser in good faith for value. Act No. 3344 applies to sale of unregistered
lands. What applies in this case is Act No. 3344, as amended, which provides for the system of
recording of transactions over unregistered real estate. Act No. 3344 expressly declares that any
registration made shall be without prejudice to a third party with a better right.
INDUSTRIAL TEXTILE MANUFACTURING COMPANY OF THE PHILIPPINES, INC., vs. LPJ
ENTERPRISES, INC., G.R. NO. 66140, January 21, 1993 21
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.
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.
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.
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 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.
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 whatsoever [and]
will save the vendee from any suit by the government of the Republic of the Philippines, is giving
a warranty against eviction. 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.
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VISAYAN SAWMILL COMPANY, INC., vs. THE HONORABLE COURT OF APPEALS, G.R. NO. 83851.
March 3, 1993.
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.
DIAMANTE vs. HON. COURT OF APPEALS, G.R. NO. L-51824 February 7, 1992
A right to repurchase was granted subsequently in an instrument different from the original
document of sale which caused the cancellation of the permit or lease by the Secretary of
Fisheries. An agreement to repurchase becomes a promise to sell when made after the sale,
because when the sale is made without such an agreement, the purchaser acquires the thing sold
absolutely, and if he afterwards grants the vendor the right to repurchase, it is a new contract
entered into by the purchaser, as absolute owner already of the object.
VASQUEZ vs. HONORABLE COURT OF APPEALS, G.R. NO. 83759 July 12, 1991
Respondents sold the lot to the petitioners under a Deed of Sale, On the same day and along with
the execution of the Deed of Sale, a separate instrument, denominated as Right to Repurchase
was executed by the parties, Later, petitioners resisted the action for redemption. The transaction
between the petitioners and private respondents was not a sale with right to repurchase, the
second instrument is just an option to buy since it is not embodied in the same document of sale
but in a separate document, and since such option is not supported by a consideration distinct
from the price, said deed for right to repurchase is not binding upon them.
BAUTISTA vs UNANGST, G.R. NO. 173002, July 4, 2008
Where in a contract of sale with pacto de retro, the vendor remains in possession, as a lessee or
otherwise, the contract shall be presumed to be an equitable mortgage because in a contract of
sale with pacto de retro, the legal title to the property is immediately transferred to the vendee,
subject to the 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.
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: "However, 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.
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Spouses CRUZ vs. LEIS et al., G.R. NO. 125233, March 9, 2000 26
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.
BPI FAMILY SAVINGS BANK, INC. vs. SPS. VELOSO, G.R. NO. 141974, August 9, 2004
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.
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.
VILLANUEVA vs. HON. ALFREDO C. FLORENDO, G.R. NO. L-33158, October 17, 1985
It is not disputed that co-ownership exists but the lower court disallowed redemption because it
considered the vendee, Vallangca, a co-heir, being married to Concepcion Villanueva. The term
"third person" or "stranger in Art. 1620 refers to all persons who are not heirs in succession, either
by will or the law or any one who is not a co-owner.
PRIMARY STRUCTURES CORP. vs. SPS. VALENCIA, G.R. NO. 150060. August 19, 2003
Article 1621 of the Civil Code expresses that the right of redemption it grants to an adjoining
owner of the property conveyed may be defeated if it can be shown that the buyer or grantee
does not own any other rural land.
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.
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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 co-owners 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 coowners 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, May 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
selling the property and transferring ownership thereof to the vendee has been given.
LEDONIO vs. CAPITOL DEVELOPMENT CORPORATION, G.R. NO. 149040, July 4, 2007
An assignment of credit has been defined as an agreement by virtue of which the owner of a credit
(known as the assignor), by a legal cause - such as sale, dation in payment or exchange or donation
- and without need of the debtor's consent, transfers that credit and its accessory rights to another
(known as the assignee), who acquires the power to enforce it, to the same extent as the assignor
could have enforced it against the debtor.
TEOCO, JR.,vs METROPOLITAN 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.
HEIRS OR REYNALDO DELA ROSA, Namely: TEOFISTA DELA ROSA, JOSEPHINE SANTIAGO AND
JOSEPH DELA ROSA, vs. MARIO A. BATONGBACAL, IRENEO BATONGBACAL, JOCELYN BA
TONGBACAL, NESTOR BATONGBACAL AND LOURDES BA TONGBACAL
G.R. No. 179205, July 30, 2014
An equitable mortgage is defined as one although lacking in some formality, or form or words, or
other requisites demanded by a statute, nevertheless reveals the intention of the parties to charge
real property as security for a debt, and contains nothing impossible or contrary to law. For the
presumption of an equitable mortgage to arise, two requisites must concur: (1) that the parties
entered into a contract denominated as a sale; and (2) the intention was to secure an existing debt
by way of mortgage.
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CEBALLOS vs. Intestate Estate of the Late EMIGDIO MERCADO, G.R. NO. 155856, May 28, 2004
30
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.
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.
EUGENIO vs. EXECUTIVE SECRETARY, G.R. NO. 109404, January 22, 1996
Did the failure to develop a subdivision constitute legal justification for the non-payment of
amortizations by a buyer on installment under land purchase agreements entered into prior to the
enactment of P.D. 957, "The Subdivision and Condominium Buyers' Protective Decree"?
P.D. 957 is undeniably applicable to the contracts in question, it follows that Section 23 thereof
had been properly invoked by private respondent when he desisted from making further payment
to petitioner due to petitioner's failure to develop the subdivision project according to the
approved plans and within the time limit for complying with the same.
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 amortizations tendered by private
respondents. Privity of contracts as a defense does not apply in this case for the law explicitly
grants to the buyer the option to pay the installment payment for his lot or unit directly to the
mortgagee (petitioner), which is required to apply such payments to reduce the corresponding
portion of the mortgage indebtedness secured by the particular lot or unit being paid for.
HULST vs. PR BUILDERS, INC., G.R. NO. 156364, September 25, 2008
Petitioner contends that the Contract to Sell between petitioner and respondent involved a
condominium unit and did not violate the Constitutional proscription against ownership of land by
aliens. The law expressly allows foreigners to acquire condominium units and shares in
condominium corporations up to not more than 40% of the total and outstanding capital stock of
a Filipino-owned or controlled corporation, since under this set up, the ownership of the land is
legally separated from the unit itself.
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CARDINAL BUILDING OWNERS ASSOCIATION, INC. vs. ASSET RECOVERY AND MANAGEMENT
CORPORATION, G.R. No. 149696, July 14, 2006
Section 20 of R.A. No. 4726, otherwise known as the Condominium Act, provides:
Sec. 20. An assessment upon any condominium made in accordance with a duly registered
declaration of restrictions shall be an obligation of the owner thereof at the time the assessment is
made. The amount of any such assessment plus any other charges thereon, such as interest, costs
(including attorney's fees) and penalties, as such may be provided for in the declaration of
restrictions, shall be and become a lien upon the condominium assessed when the management
body causes a notice of assessment to be registered with the Register of Deeds of the city or
province where such condominium project is located. The notice shall state the amount of such
assessment and such other charges thereon as may be authorized by the declaration of restrictions,
a description of the condominium unit against which the same has been assessed, and the name of
the registered owner thereof. Such notice shall be signed by an authorized representative of the
management body or as otherwise provided in the declaration of restrictions. Upon payment of
said assessment and charges or other satisfaction thereof, the management body shall cause to be
registered a release of the lien.
Such lien shall be superior to all other liens registered subsequent to the 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.
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
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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.
CA-AG.R.O-INDUSTRIAL DEVELOPMENT CORP. vs. Court of Appeals, G.R. NO. 90027, March 3,
1993
We agree with the petitioner's contention that the contract for the rent of the safety deposit box
is not an ordinary contract of lease as defined in Article 1643 of the Civil Code. It cannot be
characterized as an ordinary contract of lease under Article 1643 because the full and absolute
possession and control of the safety deposit box was not given to the joint renters the
petitioner and the Pugaos.
PARTNERSHIP, AGENCY AND TRUST
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.
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.).
HEIRS OF TAN ENG KEE vs .COURT OF APPEALS and BENGUET LUMBER COMPANY, G.R. NO.
126881; October 3, 2000
In determining whether a partnership exists, these rules shall apply:
(1) Except as provided by Article 1825, persons who are not partners as to each other are not
partners as to third persons;
(2) Co-ownership or co-possession does not of itself establish a partnership, whether such coowners or co-possessors do or do not share any profits made by the use of the property;
(3) The sharing of gross returns does not of itself establish a partnership, whether or not the
persons sharing them have a joint or common right or interest in any property which the returns
are derived;
(4) The receipt by a person of a share of the profits of a business is a prima facie evidence that he
is a partner in the business, but no such inference shall be drawn if such profits were received in
payment:
(a) As a debt by installment or otherwise;
(b) As wages of an employee or rent to a landlord;
(c) As an annuity to a widow or representative of a deceased partner;
(d) As interest on a loan, though the amount of payment vary with the profits of the business;
(e) As the consideration for the sale of a goodwill of a business or other property by installments or
otherwise.
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ALFREDO N. AGUILA, JR vs. COURT OF APPEALS and FELICIDAD S. VDA. DE ABROGAR, G.R. NO.
127347, November 25, 1999
Under Art. 1768 of the Civil Code, a partnership has a juridical personality separate and distinct
from that of each of the partners. The partners cannot be held liable for the obligations of the
partnership unless it is shown that the legal fiction of a different juridical personality is being used
for fraudulent, unfair, or illegal purposes, hence it is the partnership, not its officers or agents,
which should be impleaded in any litigation involving property registered in its name, violation of
this rule will result in the dismissal of the complaint.
Villareal vs. Ramirez, G.R. NO. 144214. July 14, 2003
Since it is the partnership, as a separate and distinct entity, that must refund the shares of the
partners, the amount to be refunded is necessarily limited to its total resources. In other words, it
can only pay out what it has in its coffers, which consists of all its assets. However, before the
partners can be paid their shares, the creditors of the partnership must first be compensated. After
all the creditors have been paid, whatever is left of the partnership assets becomes available for
the payment of the partners shares.
Angeles vs. Secretary of Justice, G.R. NO. 142612, July 29, 2005
The Angeles spouses position that there is no partnership because of the lack of a public
instrument indicating the same and a lack of registration with the Securities and Exchange
Commission (SEC) holds no water for the following reasons: first, the Angeles spouses
contributed money to the partnership and not immovable property; and second, mere failure to
register the contract of partnership with the SEC does not invalidate a contract that has the
essential requisites of a partnership. The purpose of registration of the contract of partnership is
to give notice to third parties. Failure to register the contract of partnership does not affect the
liability of the partnership and of the partners to third persons. Neither does such failure to
register affect the partnerships juridical personality. A partnership may exist even if the partners
do not use the words partner or partnership.
Ortega vs. CA, G.R. NO. 109248, July 3, 1995
The right to choose with whom a person wishes to associate himself is the very foundation and
essence of that partnership. Its continued existence is, in turn, dependent on the constancy of that
mutual resolve, along with each partner's capability to give it, and the absence of a cause for
dissolution provided by the law itself. Verily, any one of the partners may, at his sole pleasure,
dictate a dissolution of the partnership at will. He must, however, act in good faith, not that the
attendance of bad faith can prevent the dissolution of the partnership but that it can result in a
liability for damages. Among partners, mutual agency arises and the doctrine of delectus personae
allows them to have the power, although not necessarily the right, to dissolve the partnership. An
unjustified dissolution by the partner can subject him to a possible action for damages.
Liwanag vs. CA, G.R. NO. 114398, October 24, 1997
Petitioner was charged with the crime of estafa and advances the theory that the intention of the
parties was to enter into a contract of partnership, wherein Rosales (private complainant for Estafa)
would contribute the funds while she would buy and sell the cigarettes, and later divide the profits
between them But even assuming that a contract of partnership was indeed entered into by and
between the parties, SC ruled that when money or property have been received by a partner for a
specific purpose (such as that obtaining in the instant case) and he later misappropriated it, such
partner is guilty of estafa.
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Moran, Jr. vs. CA, G.R. NO. L-59956, October 31, 1984
The rule is, when a partner who has undertaken to contribute a sum of money fails to do so, he
becomes a debtor of the partnership for whatever he may have promised to contribute (Art. 1786,
Civil Code) and for interests and damages from the time he should have complied with his
obligation (Art. 1788, Civil Code). Thus in Uy v. Puzon (79 SCRA 598), which interpreted Art. 2200
of the Civil Code of the Philippines, we allowed a total of P200,000.00 compensatory damages in
favor of the appellee because the appellant therein was remiss in his obligations as a partner and
as prime contractor of the construction projects in question.
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.
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.
ISLAND SALES, INC. vs. UNITED PIONEERS GENERAL CONSTRUCTION COMPANY, G.R. NO. L22493, July 31, 1975
Defendant company, a general partnership purchased from the plaintiff a motor vehicle on an
installment basis with the condition that failure to pay any of said installments as they fall due
would render the whole unpaid balance immediately due and demandable. Having failed to
receive the installment, the plaintiff sued the defendant company for the unpaid balance with
Benjamin C. Daco, Daniel A. Guizona, Noel C. Sim, Romulo B. Lumauig, and Augusto Palisoc were
included as co-defendants in their capacity as general partners of the defendant company. In this
case, there were five (5) general partners when the promissory note in question was executed for
and in behalf of the partnership. Since the liability of the partners is pro rata, the liability of the
appellant Benjamin C. Daco shall be limited to only one-fifth of the obligations of the defendant
company. The fact that the complaint against the defendant Romulo B. Lumauig was dismissed,
upon motion of the plaintiff, does not unmake the said Lumauig as a general partner in the
defendant company. In so moving to dismiss the complaint, the plaintiff merely condoned
Lumauig's individual liability to the plaintiff.
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ELMO MUASQUE vs. COURT OF APPEALS, G.R. NO. L-39780, November 11, 1985
There is a general presumption that each individual partner is an authorized agent for the firm
and that he has authority to bind the firm in carrying on the partnership transactions. The
presumption is sufficient to permit third persons to hold the firm liable on transactions entered
into by one of members of the firm acting apparently in its behalf and within the scope of his
authority.
ANTONIO C. GOQUIOLAY, ET AL. vs. WASHINGTON Z. SYCIP, ET AL, G.R. NO. L-11840,
December 10, 1963
Where the partnership business is to deal in merchandise and goods, i.e., movable property, the
sale of its real property (immovables) is not within the ordinary powers of a partner, because it is
not in line with the normal business of the firm. But where the express and avowed purpose of the
partnership is to buy and sell real estate (as in the present case), the immovables thus acquired 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 copartners.
PRIMELINK PROPERTIES AND DEVELOPMENT CORPORATION vs. LAZATIN-MAGAT, et.al, G.R.
NO. 167379, June 27, 2006
On dissolution, the partnership is not terminated but continues until the winding up of
partnership affairs is completed. Winding up means the administration of the assets of the
partnership for the purpose of terminating the business and discharging the obligations of the
partnership.
MARJORIE TOCAO vs. COURT OF APPEALS, G.R. NO. 127405, October 4, 2000
An unjustified dissolution by a partner can subject him to action for damages because by the
mutual agency that arises in a partnership, the doctrine of delectus personae allows the partners
to have the power, although not necessarily the right to dissolve the partnership.
COMMISSIONER OF INTERNAL REVENUE vs. WILLIAM J. SUTER, G.R. NO. L-25532, February 28,
1969
A limited partnership, named "William J. Suter 'Morcoin' Co., Ltd.," was formed on 30 September
1947 by herein respondent William J. Suter as the general partner, and Julia Spirig and Gustav
Carlson, as the limited partners. The thesis that the limited partnership, William J. Suter "Morcoin"
Co., Ltd., has been dissolved by operation of law because of the marriage of the only general
partner, William J. Suter to the originally limited partner, Julia Spirig one year 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
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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.
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 represent 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.
SALLY YOSHIZAKI v. JOY TRAINING CENTER OF AURORA, INC., G.R. No. 174978. July 31, 2013
As a general rule, a contract of agency may be oral. However, it must be written when the law
requires a specific form. Specifically, Article 1874 of the Civil Code provides that the contract of
agency must be written for the validity of the sale of a piece of land or any interest therein.
Otherwise, the sale shall be void. A related provision, Article 1878 of the Civil Code, states that
special powers of attorney are necessary to convey real rights over immovable properties. Further
the special power of attorney mandated by law must be one that expressly mentions a sale or that
includes a sale as a necessary ingredient of the authorized act. Such power must be must express
in clear and unmistakable language. In the present case, the pieces of documentary evidence by
Sally did not convince the Court as to the existence of agency. Necessarily, the absence of a
contract of agency renders the contract of sale unenforceable. Joy Training effectively did not
enter into a valid contract of sale with the spouses Yoshizaki.
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.
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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 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 act of administration but an act of strict dominion or of
ownership. A special power of attorney is thus necessary for its execution through an agent.
VICTORIAS MILLING CO., INC. vs. COURT OF , G.R. NO. 117356, June 19, 2000
One factor which most clearly distinguishes agency from other legal concepts is control; one
person - the agent - agrees to act under the control or direction of another - the principal. Indeed,
the very word "agency" has come to connote control by the principal. The control factor, more
than any other, has caused the courts to put contracts between principal and agent in a separate
category.
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SAURA IMPORT and EXPORT CO., INC. vs. DEVELOPMENT BANK OF THE PHILIPPINES, G.R. NO.
L-24968, April 27, 1972
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, March 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.
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.
ECE REALTY and DEVELOPMENT, INC. vs.HAYDYN HERNANDEZ
G.R. No. 212689, August 11, 2014
Since July 1, 2013, the rate of twelve percent (12%) per annum from finality of the judgment until
satisfaction has been brought back to six percent (6%). 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
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(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.
CATHOLIC VICAR APOSTOLIC CHURCH vs. CA, G.R. L-80294-95, September 21, 1988
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 only 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. The
occupancy of the U.S. Navy partakes of the character of a commodatum, and one's ownership of a
thing may be lost by prescription by reason of another's possession if such possession be under
claim of ownership, not where the possession is only intended to be transient, in which case the
owner is not divested of his title, although it cannot be exercised in the meantime.
HERRERA vs. PETROPHIL CORPORATION, G.R. NO. L-48349 December 29, 1986
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.
BRIONES vs. CAMMAYO, G.R. NO. L-23559, October 4, 1971
In simple loan with stipulation of usurious interest, the prestation of the debtor to pay the
principal debt, which is the cause of the contract is not illegal. The illegality lies only as to the
prestation to pay the stipulated interest. Hence, being separable, the latter only should be
deemed void, since it is the only one that is illegal.
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INTEGRATED REALTY CORPORATION vs. PHILIPPINE NATIONAL BANK, G.R. NO. L-60705, June
28, 1989
OBM contends that it had agreed to pay interest only up to the dates of maturity of the
certificates of time deposit and that respondent Santos is not entitled to interest after the
maturity dates had expired, unless the contracts are renewed. When respondent invested his
money in time deposits with OBM they entered into a contract of simple loan or mutuum, not a
contract of deposit.
BPI vs. CA, G.R. NO. L-66826 August 19, 1988
The document which embodies the contract states that the US$3,000.00 was received by the bank
for safekeeping. A deposit is constituted from the moment a person receives a thing belonging to
another, with the obligation of safely keeping it and of returning the same, but if the safekeeping
of the thing delivered is not the principal purpose of the contract, there is no deposit but some
other contract.
BPI vs. CA, G.R. NO. 104612, May 10, 1994
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
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
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 MANILA INSURANCE CO INC vs SPOUSES AMURAO, G.R. NO. 179628, January 16, 2013
Petitioner imputes error on the part of the CA in treating petitioner as a solidary debtor instead of
a solidary guarantor and argues that while a surety is bound solidarily with the obligor, this does
not make the surety a solidary co-debtor. A suretys liability is joint and several and although the
contract of suretyship is secondary to the principal contract, the suretys liability to the obligee is
nevertheless direct, primary, and absolute.
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 counterbonds.
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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 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.
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.
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INTEG.R.ATED REALTY CORPORATION vs. PHILIPPINE NATIONAL BANK, G.R. NO. L-60705, June
28, 1989
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 67
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. L58469, May 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 thereby. 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.
TIOSECO vs. CA, G.R. NO. L-66597, August 29, 1986
When the respondents chose to enforce their right of redemption thru a court action they were
well within their right as the action was filed within one year from the registration of the
foreclosure sale of the real estate. The law does not even require any previous notice to the
vendee, nor a meeting between him and the redemptioner, much less a previous formal tender
before any action is begun in court to enforce the right of redemption.
PNB vs. CA, G.R. NO. L-60208, December 5, 1985
When the foreclosure proceedings are completed and the mortgaged property is sold to the
purchaser then all interest of the mortgagor are cut off from the property Prior to the completion
of the foreclosure, the mortgagor is liable for the interests on the mortgage. However, after the
foreclosure proceedings and the execution of the corresponding certificate of sale of the property
sold at public auction in favor of the successful bidder, the redemptioner mortgagor would be
bound to pay only for the amount of the purchase price with interests thereon at the rate of one
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per centum per month in addition up to the time of redemption, together with the amount of any
assessments or taxes which the purchaser may have paid thereon after the purchase and interest
on such last named amount at the same rate.
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.
RAMIREZ vs. CA, G.R. NO. L-38185, September 24, 1986
The antichretic creditor cannot ordinarily acquire by prescription the land surrendered to him by
the debtor. The petitioners are not possessors in the concept of owner but mere holders placed in
possession of the land by its owners, thus, their possession cannot serve as a title for acquiring
dominion.
OCAMPO vs. DOMALANTA, G.R. NO. L-21011, August 30, 1967
A proceeding for judicial foreclosure of mortgage is an action quasi in rem. It is based on a
personal claim sought to be enforced against a specific property of a person named party
defendant. And, its purpose is to have the property seized and sold by court order to the end that
the proceeds thereof be applied to the payment of plaintiff's claim.
CENTRAL BANK OF THE PHILIPPINES vs. CA, G.R. NO. L-45710, October 3, 1985
A pledge or mortgage is indivisible even 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.
PHILNICO INDUSTRIAL CORPORATIONvs.PRIVATIZATION AND MANAGEMENT OFFICE
G.R. No. 199420, August 27, 2014
The Pledge Agreement secures, for the benefit of PMO, the performance by PIC of its obligations
under both the ARDA and the Pledge Agreement itself. It is with the execution of the Pledge
Agreement that PIC turned over possession of its certificates of shares of stock in PPC to PMO. As
the RTC pertinently observed in its Order dated June 19, 2003, there had already been a shift in
the relations of PMO and PIC, from mere seller and buyer, to creditor-pledgee and debtorpledgor. Having enjoyed the security and benefits of the Pledge Agreement, PMO cannot now
insist on applying Section 8.02 of the ARDA and conveniently and arbitrarily exclude and/or
ignore the Pledge Agreement so as to evade the prohibition against pactum commissorium.
More importantly, the Court, in determining the existence of pactum commissorium, had focused
more on the evident intention of the parties, rather than the formal or written form. In A.
Francisco Realty and Development Corporation v. Court of Appeals, therein petitioner similarly
denied the existence of pactum commissorium because the proscribed stipulation was found in
the promissory note and not in the mortgage deed.
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omissions, is only one of the relevant factors that may be taken into account. Of more
fundamental importance are the nature of the negligent act or omission of each party and the
character and gravity of the risks created by such act or omission for the rest of the community.
The petitioners urge that the truck driver (and therefore his employer) should be absolved from
responsibility for his own prior negligence because the unfortunate plaintiff failed to act with that
increased diligence which had become necessary to avoid the peril precisely created by the truck
driver's own wrongful act or omission. To accept this proposition is to come too close to wiping
out the fundamental principle of law that a man must respond for the forseeable consequences of
his own negligent act or omission. Our law on quasi-delicts seeks to reduce the risks and burdens
of living in society and to allocate them among the members of society. To accept the petitioners'
pro-position must tend to weaken the very bonds of society.
Philippine Bank of Commerce vs. Court of Appeals, 269 SCRA 695
Respondent entrusted companys cash for deposit to his secretary who defrauded the company by
depositing the money, not to the companys account, but to her husband who maintained similar
account with the bank, made possible because the duplicate slip was not compulsory required by
the bank in accepting the deposits. Under the doctrine of last clear chance, an antecedent
negligence of a person does not preclude the recovery of damages for the supervening
negligence of, or bar a defense against liability sought by another, if the latter, who had the last
fair chance, could have avoided, the impending harm by the exercise of due diligence. Here,
assuming that the respondent company was negligent in entrusting cash to a dishonest employee,
thus providing the latter with the opportunity to defraud the company, as advanced by the
petitioner, yet it cannot be denied that the petitioner bank, thru its teller, had the last clear
opportunity to avert the injury incurred by its client, simply by faithfully observing their selfimposed validation procedure.
Pantranco North Express, Inc. vs. Baesa, 179 SCRA 384
The driver of a Pantranco bus encroached into the lane of an incoming jeepney and failed to
return the bus immediately to its own lane upon seeing the jeepney coming from the opposite
direction, resulting to the death of eight passengers of the jeep. The doctrine of last clear chance
does not take into operation here because it applies only in a situation where the plaintiff was
guilty of prior or antecedent negligence but the defendant, who had the last fair chance to avoid
the impending harm and failed to do so, is made liable for all the consequences of the accident
notwithstanding the prior negligence of the plaintiff.
Cebu Shipyard and Engineering Works, Inc. vs. William 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. [RCPI] vs. Court of Appeals, 143 SCRA 657
Defamatory words were inserted in the telegram sent by respondent Timan, which were not
noticed and were included by the RCPI in the teleG.R.am when delivered. Since negligence may
be hard to substantiate in some cases, we may apply the doctrine of RES IPSA LOQUITUR (the
thing speaks for itself), by considering the presence of facts or circumstances surrounding the
injury.
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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.
Del Rosario vs. Manila Electric Co., 57 Phil. 478
An overhead wire of Meralco conducting electricity parted and one of the charged ends fell to the
ground, and a nine (9) year old school child touched the wire and was electrocuted. It is doubtful
whether contributory negligence can properly be imputed to the deceased, owing to his
immature years and the natural curiosity which a child would feel to do something out of the
ordinary, and the mere fact that the deceased ignored the caution of a companion of the age of 8
years does not, in our opinion, alter the case.
Astudillo vs. Manila Electric Co., 55 Phil. 327
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.
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
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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.
Batiquin vs. Court of Appeals, 258 SCRA 334
A piece of rubber glove was left in the abdomen of a patient after a caesarean section operation.
The doctrine of res ipsa loquitor applies because aside from the caesarean section, private
respondent Villegas underwent no other operation which could have caused the offending piece
of rubber to appear in her uterus, it stands to reason that such could only have been a by-product
of the caesarean section performed by Dr. Batiquin.
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.
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.
Caedo vs. Yu Khe Thai, 26 SCRA 410
Yu was inside his car when his driver bumped a carretela in front and at the same time hit another
car coming from the opposite direct. Under [Article 2184], if the causative factor was the drivers
negligence, the owner of the vehicle who was present is likewise held liable if he could have
prevented the mishap by the exercise of due diligence.
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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. L-25499 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.
PLENO vs. COURT OF APPEALS, G.R. NO. L-56505, May 9, 1988
Temperate damages are included within the context of compensatory damages and in arriving at
a reasonable level of temperate damages to be awarded, trial courts are guided by our ruling that:
There are cases where from the nature of the case, definite proof of pecuniary loss cannot be
offered, although the court is convinced that there has been such loss.
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 whatsoever have
been or can be shown.
CIVIL LAW
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