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BONIFACIO OLEGARIO vs. CA G.R. No. 104892 Nov.

14, 1994

Facts: Spouses Marciliano Olegario and Aurelia Rivera-Olegario owned a parcel of land measuring 91
square meters at Caloocan City. The Olegario couples were childless but reared and educated private
respondents. Petitioner Bonifacio Olegario is the brother of Marciliano while petitioner Adelaida
Victorino is the niece of Aurelia. Aurelia Rivera-Olegario died at the age of 83. Marciliano, then eighty
(80) years old, executed a Deed of Absolute Sale of the subject property in favor of private respondents
for P50,000. The contract of sale was not registered. Marciliano died intestate. Petitioners executed a
Deed of Extra-judicial Settlement of Estate. On July 13, 1989, the said Extra-judicial Settlement was
recorded in the Register of Deeds of Caloocan City. TCT No. 190363 was issued in their names. Who then
sold to a third party the property for P200,000. Private respondents alleged that the Extra-judicial
Settlement came to their knowledge only on August 21, 1989. They tried to register their contract of
sale 3 years from its execution. The registration was denied. Private respondents filed for Annulment of
Extra-judicial Settlement of Estate and Damages against petitioners. Elena Adaon and Nestor Tejon
maintained they were buyers in good faith and for value. In due course, the trial court ruled in favor of
private respondents. CA affirmed the RTC.
Issue: whether or not the deed of absolute sale which was unregistered is valid.
Held: No. In a contract of sale, consideration is, as a rule, different from the motive of the parties.
Consideration is defined as some right, interest, benefit, or advantage conferred upon the promissor, to
which he is otherwise not lawfully entitled. As contradistinguished, motive is the condition of mind
which incites to action, but includes also the inference as to the existence of such condition, from an
external fact of a nature to produce such a condition. Under certain circumstances, however, the motive
of the parties may be regarded as the consideration when it predetermines the purpose of the contract.
When they blend to that degree, and the motive is unlawful, then the contract entered into is null and
void. In the case at bench, the primary motive of Marciliano is selling the controverted 91-squaremeter
lot to private respondents was to illegally frustrate petitioners' right of inheritance and to avoid
payment of estate tax. Illegal motive predetermined the purpose of the contract. In addition, the trial
court and respondent court failed to consider the lack of cause in the alleged deed of sale of 1986.The
evidence does not show that private respondents paid P50,000.

G.R. No. 86899-903 May 15, 1989173 SCRA 409 - Deloso vs Sandiganbayan
This petition seeks to annul and set aside the resolution of the Sandiganbayan which preventively
suspended petitioner Amor D. Deloso (accused in the criminal cases) from his position as provincial
governor of Zambales and from any office that he may be holding. Deloso was the duly elected mayor of
Botolan, Zambales in the local elections of November 1971. While he occupied the position of mayor,
acertain Juan Villanueva filed a complaint with the Tanod bayan accusing him of having committed acts
in violation of the Anti-Graft Law (Republic Act3019) for issuing to certain Daniel Ferrer a tractor
purchased by the Municipality of Botolan thru a loan financed by the Land Bank of the Philippines for
lease to local farmers at reasonable cost, without any agreement as to the payment of rentals for the
use of tractor by the latter, thereby, causing undue injury to the Municipality of Botolan. Deloso was,
then, elected governor of the Province of Zambales in the January 18, 1988 local elections.
ISSUE: Whether or not the petitioner be suspended indefinitely.
HELD: It would be most unfair to the people of Zambales who elected the petitioner to the highest
provincial office in their command if they are deprived of his services for an indefinite period with the
termination of his case possibly extending beyond his entire term. The Court rules that a preventive
suspension of an elective public officer under Section 13 of Republic Act 3019 should be limited to the
ninety (90) days under Section 42 of Presidential Decree No. 807, the Civil Service Decree, which period
also appears reasonable and appropriate under the circumstances of this case. The petitioner may still
be suspended but for specifically expressed reasons and not from an automatic application of Section 13
of the Anti-Graft and Corrupt Practices Act.


G.R. No. 104892 November 14, 1994
BONIFACIO OLEGARIO and ADELAIDA VICTORINO, petitioners,
vs.
THE HONORABLE COURT OF APPEALS, MANUEL RIVERA, PAZ OLEGARIO, and SOCORRO
OLEGARIO-TEVES, respondents.
Tranquilino F. Meris for petitioners.
Eufracio T. Layag for private respondents.

PUNO, J .:
Spouses Marciliano Olegario and Aurelia Rivera-Olegario owned a parcel of land measuring 91
square meters at 198 J.P. Rizal corner Antipolo Streets, Caloocan City as evidenced by Transfer
Certificate of Title (TCT)
No. 124222 of the Register of Deeds of Caloocan City.
1

The Olegario couples were childless but reared and educated private respondents Manuel Rivera,
Paz Olegario, and Socorro Olegario-Teves. Petitioner Bonifacio Olegario is the brother of Marciliano
while petitioner Adelaida Victorino is the niece of Aurelia.
On March 19, 1986, Aurelia Rivera-Olegario died at the age of eighty-three (83). To preclude her
heirs from inheriting and to avoid payment of taxes, Marciliano, then eighty (80) years old, executed
on April 15, 1986 a Deed of Absolute Sale of the subject property in favor of private
respondents.
2
The purported consideration was FIFTY THOUSAND PESOS (P50,000.00). The contract
of sale was not registered.
On March 10, 1988, Marciliano died intestate. Petitioners Bonifacio Olegario and Adelaida Victorino
were the sole heirs of spouses Olegario. On May 23, 1989, they executed a Deed of Extra-judicial
Settlement of Estate
3
covering the subject lot which was published in the Metropolitan Newsweek for
three (3) consecutive weeks. On July 13, 1989, the said Extra-judicial Settlement was recorded in the
Register of Deeds of Caloocan City. TCT
No. C-124222 was then cancelled and TCT No. 190363 was issued in their names.
4

On August 1, 1989, petitioners sold the subject lot for TWO HUNDRED THOUSAND PESOS
(P200,000.00) to Elena Adaon and Nestor Tejon.
5
TCT No. 190132 was then issued in vendees'
names.
Private respondents alleged that the Extra-judicial Settlement came to their knowledge only on
August 21, 1989. On that same day, they tried to register their contract of sale three (3) years from
its execution. The registration was denied as the subject property has been transferred to Elena
Adaon and Nestor Tejon.
The fight for ownership of the subject lot ensued. Private respondents filed Civil Case No. C-13973
for Annulment of Extra-judicial Settlement of Estate and Damages against petitioners.
6
As special
and affirmative defense, petitioners assailed the Deed of Absolute Sale between Marciliano Olegario and
private respondents. On the other hand, cross-claimants Elena Adaon and Nestor Tejon maintained they
were buyers in good faith and for value.
In due course, the trial court ruled in favor of private respondents. It annulled the Extra-judicial
Settlement of the subject lot and its sale to Adaon and Tejon, viz.:
WHEREFORE, the judgment is rendered for the plaintiffs and against the herein
defendants, as follows:
a) The extra-judicial settlement of estate executed by defendants Bonifacio Olegario
and Adelaida Victorino on May 23, 1989 as well as Transfer Certificates of Title
issued subsequent thereto, namely TCT No. 190363 in the name of Bonifacio
Olegario and Adelaida Victorino and TCT No. 190132 in the name of Elena Adaon
and Nestor Tejon are hereby declared NULL and VOID and without legal force and
effect;
b) The Register of Deeds of Kaloocan City is hereby ordered to issue unto the herein
plaintiffs new title in lieu of the aforesaid cancelled titles in the name of the deceased
Marciliano Olegario married to Aurelia R. Olegario containing the same entry and/or
inscription before said Title No. 124222 was cancelled;
c) Defendants Bonifacio Olegario and Aurelia Victorino Rivera are hereby ordered to
pay the herein plaintiffs, jointly and severally, the amount of P30,000.00 as nominal
damages and the further sum of P10,000.00 for and/as attorney's fees; and
d) To pay costs of suit.
With regards to the cross-claim of defendants Elena Adaon and Nestor Tejon,
judgment is hereby rendered against Bonifacio Olegario and Adelaida Victorino who
are hereby ordered as follows:
a) Defendant Bonifacio Olegario is hereby ordered to pay cross-claimants Elena
Adaon and Nestor Tejon in the amount of P60,000.00 with legal interest from August
1, 1989;
b) Defendant Adelaida Victorino is hereby ordered to pay cross-claimants Elena
Adaon and Nestor Tejon in the amount of P30,000.00 with legal interest from August
1, 1989;
c) Defendants Bonifacio Olegario and Adelaida Victorino, jointly and severally, to pay
cross-claimants the amount of P5,000.00 for and/as attorney's fees;
Counter-claim interposed by herein defendants and cross-claimants are hereby
DISMISSED for lack of evidence to support the same.
SO ORDERED.
7

Petitioners elevated the case to respondent Court of Appeals. On January 7, 1992, the Sixteenth
Division of respondent court affirmed the impugned Decision with modifications, viz.:
WHEREFORE, except for the following modifications, to wit:
a) The extra-judicial settlement of estate executed by defendants-appellants
Bonifacio Olegario and Adelaida Victorino on May 23, 1989 as well as Transfer
Certificates of Title issued subsequent thereto, namely TCT No. 190363 in the name
of Bonifacio Olegario and Adelaida Victorino and TCT No. 190132 in the name of
cross-appellants Elena Adaon and Nestor Tejon are hereby declared NULL and
VOID and without legal force and effect with respect to 3/4 portion of the subject lot
pertaining to the plaintiffs-appellees;
b) The Register of Deeds of Caloocan City is hereby ordered to issue unto the herein
plaintiffs-appellees new title corresponding to the 3/4 part of the disputed lot; and to
cancel TCT No. 190363 in the name of defendants-appellants Bonifacio Olegario and
Adelaida Victorino and TCT No. 190132 in the name of cross-claimants-appellants
Elena Adaon and Nestor Tejon, and issue in lieu thereof new title corresponding only
to 1/4 portion of the subject property; and
c) Defendants-appellants Bonifacio Olegario and Adelaida Victorino are hereby
ordered to pay the herein plaintiffs-appellees, jointly and severally, the amount of
P10,000.00 as nominal damages and the further sum of P5,000.00 for and/as
attorney's fees, the appealed decision is hereby AFFIRMED in all other respects. No
costs.
SO ORDERED.
8

Petitioners now claim that respondent court erred in the following wise:
I
THAT THE RESPONDENT COURT OF APPEALS GRAVELY ABUSED ITS
DISCRETION WHEN IT FAILED TO RESOLVE PETITIONERS' SECOND
ASSIGNMENT OF ERROR BEFORE IT AND CLOSING ITS EYES ON THE
EVIDENCE ON RECORD PATENTLY ERRED IN NOT DECLARING THAT THE
PURPORTED DEED OF ABSOLUTE SALE BETWEEN MARCILIANO OLEGARIO
AND THE PRIVATE RESPONDENTS IS NULL AND VOID FOR BEING
ABSOLUTELY SIMULATED AND FICTITIOUS AND FOR BEING VIOLATIVE OF
ARTICLE 130 OF THE FAMILY CODE.
II
THAT THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN
SUSTAINING THE EFFICACY OF THE UNRECORDED DEED OF ABSOLUTE
SALE OVER THAT OF THE EXTRA-JUDICIAL SETTLEMENT OF ESTATE WHICH
WAS EXECUTED AND RECORDED IN GOOD FAITH, CONTRARY TO THE
EXPRESS PROVISIONS OF ARTICLE 1544 OF THE CIVIL CODE.
III
THAT THE RESPONDENT COURT OF APPEALS PATENTLY ERRED IN
HOLDING THAT CROSS-CLAIMANTS ELENA ADAON AND NESTOR TEJON ARE
NOT BUYERS IN GOOD FAITH OF THE SUBJECT PROPERTY.
IV
THAT THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN
AWARDING P30,000.00 NOMINAL DAMAGES AND P10,000.00 ATTORNEY'S
FEES IN FAVOR OF THE PRIVATE RESPONDENTS DESPITE THE PATENT
ABSENCE OF FACTUAL AND LEGAL BASIS THEREFORE.
We find merit in the petition.
There is no question that petitioners are the lawful heirs of spouses Olegario. Under Article 160 of
the New Civil Code, the subject lot is presumed to be conjugal property. The death of Aurelia Rivera-
Olegario on March 19, 1986 dissolved the conjugal partnership. By virtue of such dissolution, 1/2 of
the property should appertain to Marciliano as his share from the conjugal estate plus another 1/4
representing his share as surviving spouse of Aurelia.
9
Petitioner Adelaida Victorino, as the sole
surviving niece of Aurelia, is entitled to the other 1/4 of the lot.
10
When Marciliano died intestate on March
10, 1986, petitioner Bonifacio Olegario, the only surviving brother of Marciliano, stepped into his shoe.
We shall now determine whether the inheritance right of petitioners can be prejudiced by the sale of
the subject lot by the deceased Marciliano to private respondents. In a contract of sale,
consideration is, as a rule, different from the motive of the parties. Consideration is defined as some
right, interest, benefit, or advantage conferred upon the promissor, to which he is otherwise not
lawfully entitled, or any detriment, prejudice, loss, or disadvantage suffered or undertaken by the
promisee other than to such as he is at the time of consent bound to suffer.
11
As contradistinguished,
motive is the condition of mind which incites to action, but includes also the inference as to the existence
of such condition, from an external fact of a nature to produce such a condition.
12
Under certain
circumstances, however, the motive of the parties may be regarded as the consideration when it
predetermines the purpose of the contract.
13
When they blend to that degree, and the motive is unlawful,
then the contract entered into is null and void.
14

In the case at bench, the primary motive of Marciliano is selling the controverted 91-square meter lot
to private respondents was to illegally frustrate petitioners' right of inheritance and to avoid payment
of estate tax. This was unabashedly admitted by witness Susan Rivera, wife of private respondent
Manuel Rivera, on cross-examination. She declared:
Atty. Meris: (p. 12, TSN, June 18, 1991 [sic])
xxx xxx xxx
Q You mean to say that despite of your claim that your husband is
the son of Marciliano Olegario and Aurelia Olegario, they still
executed a deed of absolute sale over the said lot owned by your
parents in law in favor of your husband and his two sisters?
A It was decided that way to avoid paying tax, sir.
Q In other words the sale was only fictitious or was only made in a
way of avoiding paying taxes?
A It was not that way but my parents in law were just avoiding distant
relatives who might claim it.
15

xxx xxx xxx
Atty. Buenaventura: (p. 15, TSN, June 18, 1990)
Q And as a husband (sic) of Manuel you are familiar of the reason
why this deed of sale was executed?
A I have stated earlier that my father in law sold it to them for the
reason that he would not want the said property to be given to
another party, sir.
Q In other words, it was not really intended as honest to goodness
sale between the former owner and Manuel Rivera, your husband
and her sister? (sic)
A Yes, sir.
16

xxx xxx xxx
We also note that in their comment, rejoinder, and memorandum private respondents did not refute
petitioners' charge that the said sale is fictitious. The conclusion is thus inescapable that the
purported sale of April 15, 1986 of the subject lot is null and void. Illegal motive predetermined the
purpose of the contract.
17

In addition, the trial court and respondent court failed to consider the lack of cause in the alleged
deed of sale of 1986.
18
The evidence does not show that private respondents had FIFTY THOUSAND
PESOS (P50,000.00) and paid
the same to Marciliano. Private respondents allegedly borrowed THIRTY THOUSAND PESOS
(P30,000.00) from the cooperative of Mary Help of Christian Parish to prove their financial capacity.
However, they floundered in their cross-examinations.
Atty. Meris: (Cross-examination of respondent Manuel Rivera) (p. 39, TSN, June 4,
1990)
xxx xxx xxx
Q And how much did you buy the said property?
A P50,000.00, sir.
Q And did you bring this money at the City Hall?
A No, sir.
Q Did you give your father the said amount?
A We spent it for the treatment of my father, for payment of the real
estate tax and burial of my mother Aurelia Olegario sir. (Emphasis
supplied).
19

xxx xxx xxx
Atty. Buenaventura on cross-examination of Paz Olegario (respondent),
pp. 22, TSN, June 23, 1990.
xxx xxx xxx
Q Do you know how much was paid?
A P50,000.00, sir
Q Was it paid in cash or in other form?
xxx xxx xxx
A No, sir.
Q What do you mean by "no sir."
Atty. Buenaventura:
May we make on record that the witness is having difficulty in
answering the question despite being repeatedly interpreted the
meaning of the question propounded on to.
xxx xxx xxx
Q When was the money given, after it (Deed of Sale) was executed
on April 15, 1986?
A Last week of April, sir.
Q Do you know where the money came from?
Atty. Buenaventura:
May we manifest to the Honorable Court that there are some signal
coming from the other witness that has been presented before the
Honorable Court and it seems that the witness is getting clue from the
other witness. (Emphasis supplied)
20

Applying Articles 1352 and 1409
21
of the Civil Code in relation to the indispensable requisite of a valid
cause, we hold that the alleged deed of sale is void.
It is also obvious to the eye that the contract of sale in 1986 is unregistered. Section 51 of
Presidential Decree No. 1529, otherwise known as the Property Registration Decree, provides that
"[T]he act of registration shall be the operative act to convey or affect the land insofar as third
persons are concerned." Thus, even if the contract of sale is valid, it cannot adversely affect third
persons because of its non-registration. More specifically, it cannot prejudice petitioners as well as
Elena Adaon and Nestor Tejon.
IN VIEW WHEREOF, the Decision of respondent court dated January 7, 1992 is REVERSED and
SET ASIDE; the Complaint in Civil Case
No. C-13973 is ordered DISMISSED. No costs.
SO ORDERED.

G.R. No. L-61898 August 9, 1985
LAO SOK, petitioner
vs.
LYDIA SABAYSABAY, AMPARO MANGULAT, ROSITA SALVIEJO, NENITA RUINATA, VILMA
CAPILLO, VIRGINIA SANORJO and THE NATIONAL LABOR RELATIONS
COMMISSION, respondents.

GUTIERREZ, JR., J .:
This is a petition for review which seeks to set aside for grave abuse of discretion the decision of the
National Labor Relations Commission dated June 21, 1982 affirming the decision of Labor Arbiter
Apolonio L. Reyes ordering the petitioner to pay the private respondents their separation pay.
The undisputed facts are:
Petitioner Lao Sok owned and operated the Shelton Department Store located at Carriedo Street,
Quiapo, Manila.
Private respondents, Lydia Sabaysabay, Amparo Mangulat, Rosita Salviejo, Nenita Ruinata, Vilma
Capillo and Virginia Sanorjo were all salesladies of the department store with a daily wage of P14.00
each.
On October 12, 1980, petitioner's store was razed by fire. He did not report the loss of jobs of the
salesladies which resulted from the burning of his department store to the Regional Office of the
Ministry of Labor.
Petitioner promised the private respondents that he would transfer them to his other department
stores. Several weeks passed but petitioner still did not fulfill his promise.
The petitioner, however, told the respondents that he would give them their separation pay and other
benefits due them as soon as he collected the insurance proceeds arising from his burned store.
The private respondents accepted this offer of the petitioner.
Petitioner later collected the proceeds of his insurance but he did not give the private respondents
their separation pay and other benefits. Neither did he employ them in his other stores as earlier
promised.
On May 14, 1981, the private respondents filed a complaint with the Ministry of Labor and
Employment charging the petitioner with illegal dismissal and non-payment of their separation pay,
allowance and incentive leave pay.
Labor Arbiter Apolonio L. Reyes required the parties to submit their position papers and on the basis
of these position papers, he rendered a decision on July 23, 1981, the dispositive portion of which
reads:
WHEREFORE, judgment is rendered in favor of the complainants and against the
respondent, ordering the latter to pay the former their separation pay equivalent to
one month salary for every year of service proportionate to their individual length of
service with the respondents at legal rate of interest in the event that respondent
failed or refused to pay the same within ten days from receipt thereof. Other issues
are dismissed for being judicata.
On October 2, 1981, the petitioner appealed said decision to the National Labor Relations
Commission (NLRC).
The NLRC affirmed the decision of the Labor Arbiter and dismissed the appeal.
Petitioner moved for a reconsideration of the decision but the motion was likewise denied.
Hence, this petition for review.
The issue in this case is whether or not petitioner Lao Sok is obligated to pay the private
respondents' separation pay.
The petitioner contends that he may not be compelled to pay separation pay on the basis of his
mere failure to make a report about the fire and the consequent dismissal of his employees which
may be effected without prior clearance. Sections 10 and 11 (c), Rule XIV, Book V of the Labor
Code provide:
Sec. 10. Exception. No clearance is required if the shutdown of establishment is
due to serious accidents, fire, flood, typhoon, earthquakes, or other disaster, calamity
or public emergencies, provided that the employer makes a report thereon to the
Regional Office in accordance with the form prescribed by the Department.
Sec. 11. When reports required. -Every employer shall submit a report to the
Regional Office in accordance with the form prescribed by the Department on the
following instances of termination of employment, suspension, layoff or shutdown
which may be effected by the employer without prior clearance, within five (5) days
thereafter:
(a) ...
(b) ...
(c) All shutdowns or cessations of work or operations falling under the exceptional
circumstances specified in Section 10 hereof;
xxx xxx xxx
Compliance with the above rules is only an administrative matter and the failure to make a report
does not make the dismissal illegal per se. But the employer who fails to file such report may be
subjected to such administrative penalties or sanctions as may be duly provided. (Oceanic Bic
Division (FFW) vs. Romero, 130 SCRA 392,405).
However, the petitioner's obligation to pay severance compensation is not based on his failure to
make a report or to ask for a prior clearance. Article 284 of the Labor Code provides for separation
pay whenever there is a reduction of personnel caused by the closure of an establishment which is
not intended to circumvent the provisions of the law. We also note that Book VI, Rule 1, Section 4 (b)
of the Rules and Regulations Implementing the Labor Code provides:
xxx xxx xxx
(b) In case the establishment where the employee is to be reinstated has closed or
ceased operations or where his former position no longer exists at the time of
reinstatement for reasons not attributable to the fault of the employer, the employee
shall be entitled to separation pay equivalent at least to one month salary or to one
month salary for every year of service, whichever is higher, a fraction of at least six
months being considered as one whole year. (emphasis supplied).
The department store or the establishment where the six salesladies are employed has ceased
operations and admittedly, it was due to reasons not attributable to the fault of the employer. But
while we can not fault petitioner Lao Sok for the loss of his store due to a fortuitous event, his acts
subsequent to the fire are equally deplorable as a termination without just cause. There is certainly a
need to alleviate the plight of the employees who have lost their jobs or sources of livelihood as a
result of the closure or cessation of operations of the establishment. Their being given the run
around after the loss of their jobs and their being given promises which could be fulfilled but which
were not fulfilled aggravated the situation.
That petitioner Lao Sok promised to give his employees their separation pay, as soon as he receives
the insurance proceeds for his burned building was not rebutted. ln fact, it appears to have been
undisputed until the petitioner filed his memorandum on December 6,1984.
We quote with favor the Solicitor General's explanation:
xxx xxx xxx
... It was in reality not a mere 'promise' as petitioner terms it but a contract, because
all the essential requisites of a valid contract are present, to wit: (1) consent was
freely given by the parties, (2) there was a subject matter, which is the payment of
the separation pay of private respondents, and (3) a cause, which is the loss of job of
private respondents who had been petitioner's salesladies for several years. ... .
xxx xxx xxx
Respondent NLRC, therefore, acted properly in ordering petitioner to give private
respondents their separation pay as he was bound to comply with his contractual
obligation which is the law between the parties (Phoenix Assurance Co. LTD. v.
United States Lines, 22 SCRA 674). ... .
Lao Sok made an offer which was duly accepted by the private respondents. There was, therefore, a
meeting of the minds between two parties whereby one bound himself with respect to the other, to
give something or to render some service (Article 1305, Civil Code). By the unconditional
acceptance of the offer that they would be paid separation pay, a contract was therefore perfected.
As held in the case of Herrera v. Auditor General, (102 Phil. 875):
xxx xxx xxx
... the Government, through the Quezon City Engineer had as late as 1955
acknowledged the financial obligation of the Government, and even offered to pay it,
and what is more, the offer was duly accepted by Herrera, thereby constituting a
contract, and a renewal of the obligation. (emphasis supplied).
Petitioner contends that the contract though orally made is unenforceable since it does not comply
with the Statute of Frauds.
This contention has no merit.
Contracts in whatever form they may have been entered into are binding on the parties unless form
is essential for the validity and enforceability of that particular contract. (See Lopez v. Auditor
General, 20 SCRA 655). We held inShaffer v. Palma (22 SCRA 934):
xxx xxx xxx
... Whether the agreement is in writing or not is a question of evidence. Nevertheless,
even granting that the agreement is not in writing, this circumstance does not militate
against the validity or enforceability of said agreement, because contracts are
binding upon the parties in whatever form they may have been entered into unless
the law requires otherwise. (Article 1356, Civil Code; Lopez v. The Auditor General,
et al., L-25859, July 13, 1967; Pilar Gil Vdan de Murciano v. The Auditor General, et
al., 103 Phil. 907). It is true that Article 1358 of the Civil Code provides that contracts
involving more than P500.00 must appear in writing, but nothing is said therein that
such requirement is necessary for their validity or enforceability. It has been held that
the writing required under Article 1358 is merely for convenience, (Thunga Chui v.
Que Bentac, 2 Phil. 561; Ng Hoc v. Tong Ho, 52 0,G., 4396) and so the agreement
alleged in the amended complaint in the present case can be enforced even if it may
not be in writing.
The requirement of writing for the offer made by Lao Sok is only for convenience and not
enforceability. In fact, the petitioner could be compelled to put the offer in writing, a step no longer
necessary now because of this petition.
Furthermore, it was also established that petitioner Lao Sok has other department stores where he
promised to absorb the salesladies. He was likewise remiss in this obligation. There is Merit in the
Solicitor General's submission that, in effect, the fire closed only a division or unit of Lao Sok's
business. His entire enterprise consisting of the operation of various department stores did not really
close down or cease.
We agree with the respondents that:
xxx xxx xxx
... the record shows that petitioner voluntarily agreed to compensate private
respondents for the loss of their jobs because they have been his salesladies for a
long time; that he did this freely and spontaneously (Motion for Reconsideration, p.
88, record). He should not now, therefore, be allowed to renege on an obligation of
his own making. To do so, would be unjust and unfair to the private respondents who
took his word for it in good faith. The validity of that agreement must, consequently,
be sustained (Jimeno v. Gacilago, 14 Phil. 16; Legarda v. Ongsiaco, 36 Phil. 185).
Both the law and equity dictate that private respondents must be compensated for the loss of their
jobs considering that they were kept waiting and hoping that they would be re-employed by the
petitioner, if not paid their severance pay.
WHEREFORE, the decision is hereby AFFIRMED and judgment is rendered in favor of private
respondents, ordering the petitioner to pay the former their separation pay equivalent to one month
salary for every year of service proportionate to their individual lengths of service with the petitioner.
SO ORDERED.