OCAMPO III. VS.

PEOPLE
G.R Nos. 156547-51. February 4, 2008

38 Phil. 182

FACTS:

FACTS:

The Department of Budget and Management released the amount of

Php 100 Million for the support of the local government unit of the province
of Tarlac. However, petitioner Ocampo, governor of Tarlac, loaned out more
than P 56.6 million in which he contracted with Lingkod Tarlac Foundation,
Inc.. thus, it was the subject of 25 criminal charges against the petitioner.

On December 12, 1917 an action was instituted in the CFI of Manila

by OBrien to recover from Leung Ben the sum of P15, 000.00 alleged to
have been lost by the plaintiff to the defendant in a series of gambling,
banking and percentage games conducted during the two or three months
prior to the institution of the suit. In his verified complaint the plaintiff
asked for an attachment, under sections 424 and 412 (1) of the Code of
Civil Procedure against the property of the defendant on the ground that the
latter was about to depart from the Philippine Island with intent to defraud
his creditors. The attachment was issued and acting on the authority
thereof, the sheriff attached the sum of P15, 000.00 which had been
deposited by the defendant with the International Banking Corporation.

The Sandiganbayan convicted the petitioner of the crime of

malversation of public funds. However, the petitioner contended that the
loan was private in character since it was a loan contracted with the Taralc
Foundation.

ISSUE:
Whether the amount loaned out was private in nature.

The defendant moved to quash the attachment; the court however,

dismissed said motion. On January 8, 1918, petitioner Leung Ben, the
defendant in that action filed his petition for writ of certiorari directed
against OBrien and the judges of CFI. The prayer is that, the honorable
James A. Ostrand be required to certify the records for review and that the
order of attachment that had been issued should be revoked and discharged
with cost.

RULING:
Yes, the loan was private in nature because Art. 1953 of the New
Civil Code provides that a person who receives a loan of money or any
other fungible thing acquires the ownership thereof, and is bound to pay the
creditor an equal amount of the same kind and quality.
The fact that the petitioner-Governor contracted the loan, the public
fund changed its nature to private character, thus it is not malversation
which is the subject of this case, instead it must be a simple collection of
money suit against the petitioner in case of non payment . therefore, the
petitioner is acquitted for the crime of malversation.
Leung Ben vs. OBrien
G.R. No. L-13602, April 6, 1918

ISSUE:
The issue is whether or not the statutory obligation to restore money
won at gaming is an obligation from contract, express or implied.

HELD:

The duty of the defendant to refund the money which he won from
the plaintiff at gaming is not an obligation from contract, express or
implied rather it is a duty imposed by statute. Upon general principles,
recognized both in civil and common law, money lost at gaming and
voluntarily paid by the loser to the winner cannot, in the absence of statute,
be recovered in a civil action. But Act No. 1757 of the Philippine
Commission, which defines and penalizes several forms of gambling,
containing numerous provisions recognizing the right to recover money lost
in gambling or in the playing of certain games. The obligation of the
defendant to restore or refund the money which he won from the plaintiff at
gaming therefore arises ex lege.

Arturo Pelayo vs. Marcelo Lauron

G.R. No. L-4089, January 12, 1909
12 Phil. 453
FACTS:
On or about October 13, 1906, the plaintiff Arturo Pelayo was called
to the house of the defendants, Marcelo Lauron and Juana Abella situated in
San Nicolas, and that upon arrival he was requested by them to render
medical assistance to their daughter-in-law who was about to give birth to a
child. After consultation with the attending physician, Dr. Escao, the
plaintiff found it necessary to remove the fetus by means of an operation, in
which service he was occupied until the following morning, and had visited
the patient several times. The equitable value of the services rendered by the
plaintiff was P500.00, which the defendants refused to pay. On November
23, 1906, the plaintiff filed a complaint against the defendants and prayed
that the judgment be rendered in his favor as against the defendants, or any
of them, for the sum of P500 and costs, together with any other relief that
may be deemed proper. In answer, the defendants denied all allegations and
alleged as a special defense, that their daughter-in-law died as a
consequence of the said childbirth, and when she was still alive she lived
with her husband independently and in a separate house and without any

relation whatsoever with them, and on the day she gave birth she was in the
house of the defendants and her stay there was accidental and due to
fortuitous circumstances. Thus, the defendants prayed that they be absolved
from the complaint with costs against the plaintiff.
The plaintiff demurred the answer and that the lower court sustained
the demurrer directing the defendants to amend their answer. In compliance,
the defendants amended their answer denying each and every allegation
contained in the complaint. The lower court rendered judgment in favor of
the defendants absolving them from the complaint.
ISSUE:
The issue is whether or not the parents-in-law are under any obligation to
pay the fees claimed by the plaintiff.
HELD:
The defendants were not, nor are they now, under any obligation by
virtue of any legal provision, to pay the fees claimed, nor in consequence of
any contract entered into between them and the plaintiff from which such
obligation might have arisen.
The rendering of medical assistance in case of illness is comprised
among the mutual obligations to which spouses are bound by way of mutual
support. When either of them by reason of illness should be in need of
medical assistance, the other is under the unavoidable obligation to furnish
the necessary services of a physician in order that the health may be
restored; the party bound to furnish such support is therefore, liable for all
the expenses, including the fees of the medical expert for his professional
services. The liability arises from the obligation, which the law has
expressly established, between married couples. It is therefore the husband
of the patient who is bound to pay for the services of the plaintiff. The fact
that it was not the husband who called the plaintiff and requested the
medical assistance for his wife is no bar to his fulfillment of such
obligation, as the defendants, in view of the imminent danger to which the
life of the patient was at that moment exposed, considered that the medical
assistance was urgently needed. Therefore, plaintiff should direct his action
against the husband of the patient, and not against her parents-in-law.

ASI CORPORATION VS. EVANGELISTA

G.R No. 158086.
February 14, 2008

RAMAS VS. QUIAMCO

G.R No. 146322. December 6, 2006
FACTS:

FACTS:
Private respondent Evangelista contracted Petitioner ASJ
Corporation for the incubation and hatching of eggs and by products owned
by Evangelista Spouses. The contract includes the scheduled payments of
the service of ASJ Corporation that the amount of installment shall be paid
after the delivery of the chicks. However, the ASJ Corporation detained the
chicks because Evangelista Spouses failed to pay the installment on time.
ISSUE:
Was the detention of the alleged chicks valid and recognized under
the law?

Quiamco has amicably settled with Davalan, Gabutero and

Generoso for the crime of robbery and that in return, the three had
surrendered to Quiamco a motorcycle with its registration. However, Atty.
Ramas has sold to Gabutero the motorcycle in installment but when the
latter did not able to pay the installment, Davalon continued the payment
but when he became insolvent, he said that the motorcycle was taken by
Quiamcos men. However, after several years, the petitioner Ramas together
with policemen took the motorcycle without the respondents permit and
shouted that the respondent Quiamco is a thief of motorcycle. Respondent
then filed an action for damages against petitioner alleging that petitioner is
liable for unlawful taking of the motorcycle and utterance of a defamatory
remark and filing a baseless complaint. Also, petitioners claim that they
should not be held liable for petitioners exercise of its right as sellermortgagee to recover the mortgaged motorcycle preliminary to the
enforcement of its right to foreclose on the mortgage in case of default.

RULING:
ISSUE:
No, because ASJ Corporation must give due to the Evangelista
Spouses in paying the installment, thus, it must not delay the delivery of the
chicks. Thus, under the law, they are obliged to pay damages with each
other for the breach of the obligation.

Whether the act of the petitioner is correct.

RULING:

Therefore, in a contract of service, each party must be in good faith

in the performance of their obligation, thus when the petitioner had detained
the hatched eggs of the respondents spouses, it is an implication of putting
prejudice to the business of the spouses due to the delay of paying
installment to the petitioner.

No. The petitioner being a lawyer must know the legal procedure
for the recovery of possession of the alleged mortgaged property in which
said procedure must be conducted through judicial action. Furthermore, the
petitioner acted in malice and intent to cause damage to the respondent
when even without probable cause, he still instituted an act against the law
on mortgage.

Nikko Hotel Manila Garden vs. Roberto Reyes

G.R. No. 154259, February 28, 2005
452 SCRA 532
FACTS:
Respondent herein Roberto Reyes, more popularly known by the
screen name Amay Bisaya, alleged that while he was having coffee at the
lobby of Hotel Nikko, he was spotted by Dr. Violeta Filart, his friend of
several years, invited him to join her in a party at the hotels penthouse in
celebration of the natal day of the hotels manager, Mr. Masakazu Tsuruoka.
Mr. Reyes asked if she could vouch for him for whom she replied: of
course. Reyes then went up with the party of Dr. Filart carrying the basket
of fruits which was the latters present for the celebrant. At the penthouse,
they first had their picture taken with the celebrant after which Reyes sat
with the party of Dr. Filart. After a couple of hours, when the buffet dinner
was ready, Mr. Reyes lined-up at the buffet table but, to his great shock,
shame and embarrassment, he was stopped by Ruby Lim, the Executive
Secretary of Hotel Nikko. Reyes alleged that Ruby Lim, in a loud voice and
within the presence and hearing of the other guests who were making a
queue at the buffet table, told him to leave the party because he was not
invited. Mr. Reyes tried to explain that he was invited by Dr. Filart but the
latter, who was within hearing distance, completely ignored him thus adding
to his shame and humiliation. Afterwards, while he was still recovering
from the traumatic experience, a Makati policeman approached and asked
him to step out of the hotel. Like a common criminal, he was escorted out of
the party by the policeman. Claiming damages, Mr. Reyes asked for One
Million Pesos actual damages, One Million Pesos moral and/or exemplary
damages and Two Hundred Thousand Pesos attorneys fees.
Petitioners Lim and Hotel Nikko contend that pursuant to the
doctrine of volenti non fit injuria, they cannot be made liable for damages
as respondent Reyes assumed the risk of being asked to leave (and being
embarrassed and humiliated in the process) as he was a gate-crasher.
ISSUE:

Whether or not Hotel Nikko and Ruby Lim are jointly and severally
liable with Dr. Filart for damages under Articles 19 and 21 of the Civil
Code.
HELD:
The doctrine of volenti non fit injuria (to which a person assents is
not esteemed in law as injury) refers to self-inflicted injury or to the
consent to injury which precludes the recovery of damages by one who has
knowingly and voluntarily exposed himself to danger, even if he is not
negligent in doing so.
The Supreme Court agreed with the lower courts ruling that Ms.
Lim did not abuse her right to ask Mr. Reyes to leave the party as she talked
to him politely and discreetly. Considering the closeness of defendant Lim
to plaintiff when the request for the latter to leave the party was made such
that they nearly kissed each other, the request was meant to be heard by him
only and there could have been no intention on her part to cause
embarrassment to him. In the absence of any proof of motive on the part of
Ms. Lim to humiliate Mr. Reyes and expose him to ridicule and shame, it is
highly unlikely that she would shout at him from a very close distance. Ms.
Lim having been in the hotel business for twenty years wherein being polite
and discreet are virtues to be emulated, the testimony of Mr. Reyes that she
acted to the contrary does not inspire belief and is indeed incredible. Ms.
Lim, not having abused her right to ask Mr. Reyes to leave the party to
which he was not invited, cannot be made liable to pay for damages under
Articles 19 and 21 of the Civil Code. Necessarily, neither can her employer,
Hotel Nikko, be held liable as its liability springs from that of its employee.
Had respondent simply left the party as requested, there was no need for the
police to take him out.

St. Marys Academy vs. William Carpitanos and Lucia S. Carpitanos

G.R. No. 143363, February 6, 2002
426 Phil 878
FACTS:
From 13 to 20 February 1995, St. Marys Academy of Dipolog City
conducted an enrollment drive for the school year 1995-1996. A facet of
the enrollment campaign was the visitation of schools from where
prospective enrollees were studying. As a student of St. Marys Academy,
Sherwin Carpitanos was part of the campaigning group. Accordingly, on
the fateful day, Sherwin, along with other high school students were riding
in a Mitsubishi jeep owned by defendant Vivencio Villanueva on their way
to Larayan Elementary School, Larayan, Dapitan City. The jeep was driven
by James Daniel II then 15 years old and a student of the same school.
Allegedly, the latter drove the jeep in a reckless manner and as a result the
jeep turned turtle.Sherwin Carpitanos died as a result of the injuries he
sustained from the accident.
ISSUE:
Whether the petitioner is liable for damages for the death of Sherwin
Carpitanos.
HELD:
For petitioner to be liable, there must be a finding that the act or
omission considered as negligent was the proximate cause of the injury
caused because the negligence must have a causal connection to the
accident. In this case, the respondents failed to show that the negligence of
petitioner was the proximate cause of the death of the victim.
Respondents Daniel spouses and Villanueva admitted that the
immediate cause of the accident was not the negligence of petitioner or the
reckless driving of James Daniel II, but the detachment of the steering
wheel guide of the jeep. Hence, 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. Between the remote cause and the injury, there intervened
the negligence of the minors parents or the detachment of the steering
wheel guide of the jeep. Hence, with the overwhelming evidence presented
by petitioner and the respondent Daniel spouses that the accident occurred
because of the detachment of the steering wheel guide of the jeep, it is not
the school, but the registered owner of the vehicle who shall be held
responsible for damages for the death of Sherwin Carpitanos.
SPS. GUANIO v. MAKATI SHANGRI-LA HOTEL
GR No. 190601, February 7 2011
FACTS:
For their wedding reception on July 28, 2001, spouses Luigi M.
Guanio and Anna Hernandez-Guanio (petitioners) booked at the Shangri-la
Hotel Makati.Prior to the event, Makati Shangri-La Hotel & Resort, Inc.
(respondent) scheduled an initial and final food tasting. The parties
eventually agreed on a final price P1,150 per person.On July 27, 2001,
the parties finalized and signed their contract.
Petitioners claim that during the reception, respondents
representatives, Catering Director Bea Marquez and Sales Manager Tessa
Alvarez, did not show up despite their assurance that they would; their
guests complained of the delay in the service of the dinner; certain items
listed in the published menu were unavailable; the hotels waiters were rude
and unapologetic when confronted about the delay; and despite Alvarezs
promise that there would be no charge for the extension of the reception
beyond 12:00 midnight, they were billed and paid P8,000 per hour for the
three-hour extension of the event up to 4:00 A.M. the next day. They further
claim that they brought wine and liquor in accordance with their open bar
arrangement, but these were not served to the guests who were forced to
pay for their drinks.

Petitioners thus sent a letter-complaint to the Makati Shangri-la Hotel

and Resort, Inc.and received an apologetic reply from Krister Svensson, the
hotels Executive Assistant Manager in charge of Food and Beverage. They
nevertheless filed a complaint for breach of contract and damages before
the RTC of Makati City. Respondents averred that it was the increase in
number of the unexpected guests that led to the shortage claimed by the
petitioners.
The RTC rendered a decision in favor of the plaintiffs and was
reversed by the CA, upon appeal, the latter holding that the proximate cause
of petitioners injury was an unexpected increase in their guests.
ISSUE:
Whether or not the CA correctly held that the proximate cause of
petitioners injury was an unexpected increase in their guests.
HELD:
The Court finds that since petitioners complaint arose from a
contract, the doctrine of proximate cause finds no application to it, the latter
applicable only to actions for quasi-delicts, not in actions involving breach
of contract.
Breach of contract is defined as the failure without legal reason to
comply with the terms of a contract. It is also defined as the failure, without
legal excuse, to perform any promise which forms the whole or part of the
contract. The appellate court, and even the trial court, observed that
petitioners were remiss in their obligation to inform respondent of the
change in the expected number of guests. The observation is reflected in
the records of the case. Petitioners failure to discharge such obligation thus
excused respondent from liability for any damage or inconvenience
occasioned thereby.

TSPIC CORPORATION VS. TSPIC EMPLOYEES UNION

G.R No. 163419. February 13, 2008
FACTS:
TSPI Corporation entered into a Collective Bargaining Agreement
with the corporation Union for the increase of salary for the latters
members for the year 2000 to 2002 starting from January 2000. thus, the
increased in salary was materialized on January 1, 2000. However, on
October 6, 2000, the Regional Tripartite Wage and production Board raised
daily minimum wage from P 223.50 to P 250.00 starting November 1, 2000.
Conformably, the wages of the 17 probationary employees were increased
to P250.00 and became regular employees therefore receiving another 10%
increase in salary. In January 2001, TSPIC implemented the new wage rates
as mandated by the CBA. As a result, the nine employees who were senior
to the 17 recently regularized employees, received less wages. On January
19, 2001, TSPICs HRD notified the 24 employees who are private
respondents, that due to an error in the automated payroll system, they were
overpaid and the overpayment would be deducted from their salaries
starting February 2001. The Union on the other hand, asserted that there
was no error and the deduction of the alleged overpayment constituted
diminution of pay.
ISSUE:
Whether the alleged overpayment constitutes diminution of pay as
alleged by the Union.
RULING:
Yes, because it is considered that Collective Bargaining Agreement
entered into by unions and their employers are binding upon the parties and

be acted in strict compliance therewith. Thus, the CBA in this case is the
law between the employers and their employees.
Therefore, there was no overpayment when there was an increase of
salary for the members of the union simultaneous with the increasing of
minimum wage for workers in the National Capital Region. The CBA
should be followed thus, the senior employees who were first promoted as
regular employees shall be entitled for the increase in their salaries and the
same with lower rank workers.

P1,000,000.00 as exemplary damages, P250,000.00 as actual damages &

cost of litigation and attorneys fees.
The Regional Trial Court dismissed the complaint for lack of merit. It ruled
that Commission on Higher Education, not the court, has jurisdiction over
the controversy.

ISSUES:

Regino vs. Pangasinan Colleges of Science and Technology

G.R. No. 156109
November 8, 2004

Whether or not court has jurisdiction over the controversy.

Whether or not there was a breach of contract and liability of tort.
HELD:

FACTS:
Petitioner Khristine Rea M. Regino was a first year computer
science student of Pangasinan Colleges of Science and Technology (PCST).
Reared in a poor family, Regino went to college mainly through the
financial support of her relatives. She enrolled Logic and Statistics subjects
under Rachelle Gamurot and Elissa Baladad, respectively as teachers.
In February 2002, PCST held a fund raising campaign dubbed The
Rave Party and Dance Revolution the proceeds which were to go to the
construction of the schools tennis and volleyball courts. Each student was
required to pay for two tickets at the price of P100.00 each. The project
was allegedly implemented by recompensing students who purchased
tickets with additional points in their test scores; those who refused to pay
were denied the opportunity to take the final examinations.
Financially strapped and prohibited by her religion from attending
dance parties and celebration, Regino refused to pay tickets. On March 14
and 15, 2002, the scheduled dates of examinations in Logics and Statistics,
the teachers allegedly disallowed her from taking the tests. Petitioner then
filed as pauper litigant, a complaint for damages against PCST. She prayed
for P500,000.00 as nominal; P500,000.00 as moral and at least

The doctrine of exhaustion of administrative remedies is basic.

Court for reasons of law, comity and convenience should not entertain suits
unless the available administrative remedies have first been resorted to and
the proper authorities have been given the appropriate opportunity to act
and correct their alleged errors. Exhaustion of administrative remedies is
applicable when there is a competence on the part of the administrative
bodies to act upon the matter complained of.
The terms of the school-student contract are defined at the moment
of its inception-upon enrolment of the student.
PCST imposed the assailed revenue-raising measure belatedly in the
middle of the semester, It exacted the dance party fee as a condition for
students in taking the final examinations and ultimately for recognition of
their ability to finish a course. The fee, however, was not part of the schoolstudent contract entered into at the start of the school year.
Wherefore, the petition is hereby granted, and the assailed orders
reversed. The trial court is directed to reinstate the complaint and with all
deliberate speed, to continue the proceedings in Civil Case No. U-7541. No
costs.

PSBA vs. Court of Appeals

G.R. No. 84698, February 4, 1992

ISSUE:
Whether or not the appellate court's failure to consider such material facts
means the exculpation of the petitioners from liability.
HELD:

FACTS:
A stabbing incident on 30 August 1985 which caused the death of
Carlitos Bautista while on the second-floor premises of the Philippine
School of Business Administration (PSBA) prompted the parents of the
deceased to file suit in the Regional Trial Court of Manila for damages
against the said PSBA and its corporate officers. At the time of his death,
Carlitos was enrolled in the third year commerce course at the PSBA. It was
established that his assailants were not members of the school's academic
community but were elements from outside the school.
Substantially,
the plaintiffs (now private respondents) sought to adjudge them liable for
the victim's untimely demise due to their alleged negligence, recklessness
and lack of security precautions, means and methods before, during and
after the attack on the victim.
Defendants a quo (now petitioners) sought to have the suit dismissed,
alleging that since they are presumably sued under Article 2180 of the Civil
Code, the complaint states no cause of action against them, as jurisprudence
on the subject is to the effect that academic institutions, such as the PSBA,
are beyond the ambit of the rule in the afore-stated article.
The respondent trial court, however, overruled petitioners contention and
thru an order dated 8 December 1987, denied their motion to dismiss. Said
decision of the respondent appellate court was primarily anchored on the
law of quasi-delicts, as enunciated in Articles 2176 and 2180 of the Civil
Code.
Article 2180, in conjunction with Article 2176 of the Civil Code,
establishes the rule of in loco parentis. It had been stressed that the law
(Article 2180) plainly provides that the damage should have been caused or
inflicted by pupils or students of the educational institution sought to be
held liable for the acts of its pupils or students while in its custody.
However, this material situation does not exist in the present case for the
assailants of Carlitos were not students of the PSBA, for whose acts the
school could be made liable.

It does not necessarily follow. When an academic institution accepts

students for enrollment, there is established a contract between them,
resulting in bilateral obligations which both parties are bound to comply
with. For its part, the school undertakes to provide the student with an
education that would presumably suffice to equip him with the necessary
tools and skills to pursue higher education or a profession. On the other
hand, the student covenants to abide by the school's academic requirements
and observe its rules and regulations.Institutions of learning must also meet
the implicit or "built-in" obligation of providing their students with an
atmosphere that promotes or assists in attaining its primary undertaking of
imparting knowledge. Certainly, no student can absorb the intricacies of
physics or higher mathematics or explore the realm of the arts and other
sciences where there looms around the school premises a constant threat to
life and limb. Necessarily, the school must ensure that adequate steps are
taken to maintain peace and order within the campus premises and to
prevent the breakdown thereof. Because the circumstances of the present
case evince a contractual relation between the PSBA and Carlitos Bautista,
the rules on quasi-delict do not apply.
However, there is, as yet, no finding that the contract between the school
and Bautista had been breached thru the former's negligence in providing
proper security measures. Even if there be a finding of negligence, the same
could give rise generally to a breach of contractual obligation only. Using
the test of Cangco, supra, the negligence of the school would not be relevant
absent a contract. In fact, that negligence becomes material only because of
the contractual relation between PSBA and Bautista. In other words, a
contractual relation is a condition sine qua non to the school's liability. The
negligence of the school cannot exist independently of the contract, unless
the negligence occurs under the circumstances set out in Article 21 of the
Civil Code.

Cosmo Entertainment Management, Inc. vs. La Ville Commercial

Corporation
G.R. No. 152801, August 20, 2004
437 SCRA 145
FACTS:
The respondent, La Ville Commercial Corporation, is the registered
owner of a parcel of land covered by TCT No. 174250 of the Registry of
Deeds of Makati City together with the commercial building thereon
situated at the corner of Kalayaan and Neptune Streets in Makati City.

well as to vacate and surrender the premises to the respondent. When the
petitioner refused to comply with its demand, the respondent filed with the
Metropolitan Trial Court of Makati City a complaint for illegal detainer.
The petitioner, in its answer to the complaint, raised the defense that, under
the contract, it had the right to sublease the premises upon prior written
consent by the respondent and payment of transfer fees. However, the
respondent, without any justifiable reason, refused to allow the petitioner to
sublease the premises.
ISSUE:
Whether or not the petitioner has the right to sublease the premises.
HELD:

On March 17, 1993, it entered into a Contract of Lease with

petitioner Cosmo Entertainment Management, Inc. over the subject property
for a period of seven years with a monthly rental of P250 per square meter
of the floor area of the building and a security deposit equivalent to three
monthly rentals in the amount of P447, 000.00 to guarantee the faithful
compliance of the terms and conditions of the lease agreement. Upon
execution of the contract, the petitioner took possession of the subject
property.
The petitioner, however, suffered business reverses and was
constrained to stop operations in September 1996. Thereafter, the petitioner
defaulted in its rental payments. Consequently, the respondent made a
demand on the petitioner to vacate the premises as well as to pay the
accrued rentals plus interests which, as of January 31, 1997, amounted to
P740, 478.91. In reply to the demand, the petitioner averred that its unpaid
rentals amounted to P698, 500 only and since it made a security deposit of
P419, 100 with the respondent, the said amount should be applied to the
unpaid rentals; hence, the outstanding accounts payable would only be
P279, 400. The respondent requested that the interest charges be waived
and it be given time to find a solution to its financial problems.
After negotiations between the parties failed, the respondent, on May
27, 1997, reiterated its demand on the petitioner to pay the unpaid rentals as

The Court is convinced that the findings and conclusions of the

court a quo and the RTC are in order. These courts uniformly found that,
under the terms of the contract of lease, the respondent, as the owner-lessor
of the premises, had reserved its right to approve the sublease of the same.
The petitioner, having voluntarily given its consent thereto, was bound by
this stipulation. And, having failed to pay the monthly rentals, the petitioner
is deemed to have violated the terms of the contract, warranting its
ejectment from the leased premises. The Court finds no cogent reason to
depart from this factual disquisition of the courts below in view of the rule
that findings of facts of the trial courts are, as a general rule, binding on this
Court.

building plans for a condominium project, known as the

Peak, Ayala released title to the lot, thereby enabling RosaDiana to register the Deed of Sale on its favor and obtain
certificate of Title in its name.

Ayala Corporation vs. Rosa Diana Realty

G.R. No. 134284, December 1, 2000
346 SCRA 663
FACTS:
Petitioner Ayala Corporation (Ayala) was the
registered owner of a parcel of land located in Alfaro
Street, Salcedo Village, Makati City with an area of 840
square meters more or less and covered by TCT no. 233435
of the Register of Deeds of Rizal.
On April 20, 1976, Ayala sold the lot to Manuel Sy
married to Vilma Po and Sy Ka Kieng married to Rosa
Chan. The Deed of Sale executed between Ayala and the
buyers contained Special Conditions of Sale and Deed
Restrictions.
Manuel Sy and Sy Ka Kieng failed to
construct the building in violation of the Special Conditions
of Sale. Notwithstanding the violation, Manuel Sy and Sy
Ka Kieng were able to sell the lot to respondent Rosa-Diana
Realty and Development Corp. with Ayalas approval. As a
consideration for Ayala to release the certificate of title of
the subject property, Rosa-Diana, executed an undertaking
promising to abide by said Special Condition of Sale
executed between Ayala and the original vendees. Upon
the submission of the undertaking, together with the

Thereafter, Rosa-Diana submitted to the building

official of Makati another set of building plans which were
substantially different from those that it earlier submitted
to Ayala for approval. During the construction of RosaDianas condominium project, Ayala filed an action with the
RTC of Makati for specific performance with application for
a writ of preliminary injunction seeking to compel the latter
to comply with the contractual obligations under the Deed
of Restriction annotated on the title as well as with the
building plans it submitted to the latter. In the alternative,
Ayala prayed for rescission of the sale of the subject lot to
Rosa-Diana Realty. The lower court denied Ayalas prayer
for injunctive relief; thus, enabling Rosa-Diana to complete
the construction of the building. Ayala tried to cause the
annotation a notice of lis pendens on Rosa-Dianas title but
the Register of Deed of Makati refused registration on the
ground that the case pending before the trial court being
an action for specific performance and or rescission is an
action in personam which does not involve the title, use or
possession of the property.
The Land Registration
Authority reversed the ruling of the Register of Deeds. The
decision of the LRA, however, was reversed by the CA.
ISSUE:
The issue is whether or not respondent Rosa-Diana
has the obligation to enforce the Deed of Restrictions
contained in the contract it entered with Ayala.
HELD:

Contractual obligations between parties have the

force of law between them and absent any allegation that
the same are contrary to law, morals, good customs, public
order or public policy, they must be complied with in good
faith. Hence, Article 1159 of the new Civil Code provides
obligations arising from contracts have the force of law
between the contracting parties and should be complied
with in good faith.

agreement providing that private respondent would

additionally pay to petitioner the amount of P55, 364.68 or
21% interest on the balance of downpayment for the period
from 31 March to 30 June 1981 and of P390, 367.37
representing interest paid by petitioner corporation to the
Philippine Savings Bank in updating the bank loan for the
period from 1 February to 31 March 1981.

Hence, respondent Rosa-Diana has the obligation to

enforce the Deed of Restrictions contained in the contract
it entered with Ayala.

On 12 October 1981, Petitioner Corporation sent

notice of cancellation of contract to private respondent on
account of the latters continued failure to pay the
installment due 30 June 1981 and interest on the unpaid
balance of the stipulated initial payment.

Bricktown Development vs. Amor Tierra Development

G.R. No. 112182, December 12, 1994
239 SCRA 126

On 26 September 1983, private respondent

demanded the refund of its various payment to petitioner
amounting to P2, 445, 497.71. However, petitioner did not
heed the demand, so private respondent filed an action
with the court a quo.

FACTS:

The lower court ruled in favor of private respondent

and it was affirmed in toto by the appellate court.

On
31
March
1981,
petitioner
Bricktown
Development Corporation executed two contracts to sell in
favor of petitioner Tierra Corp. covering a total of 96
residential lots situated at the Multinational Village
Subdivision, La Huerta, Paraaque, Metro Manila. The
total price of P21,639,875.00 was stipulated to be paid by
private respondent in such amount and maturity dates, as
follows; P2,200,000.00 on March 31, 1981, P3, 209, 965.75
on 30 June 1981, P4, 729, 906.25 on 31 December 1981,
and the balance of P11, 500,000.00 to be paid by means of
an assumption by private respondent of petitioners
corporations mortgage liability to the Philippine Saving
Bank or, alternatively, to be made payable in cash. On even
date 31 March 1981, the parties executed a supplemental

ISSUE:
The issue is whether or not the contracts to sell were
validly rescinded or cancelled by Petitioner Corporation.
HELD:
The contracts to sell were validly rescinded by
Petitioner Corporation. In fine, while we must conclude
that petitioner corporation still acted within its legal right
to declare the contracts to sell rescinded or cancelled,
considering, nevertheless, the peculiar circumstances

found to be extant by the trial court, confirmed by the

Court of Appeals, it would be unconscionable to likewise
sanction the forfeiture by petitioner corporation of
payments made to it by private respondent. Indeed, the
Court has intimated that the relationship between parties
in any contract must always be characterized and
punctuated by good faith and fair dealing. Judging from
what the court below have said, petitioners did fall well
behind that standard. The Court does not find it equitable
to adjudge any interest payment by petitioners on the
amount to be thus refunded computed from judicial
demand, for indeed, private respondent should not be
allowed to totally free itself from its own breach.
Pilipinas Hino vs. Court of Appeals
G.R. No. 126570, August 18, 2000
338 SCRA 355
FACTS:
The plaintiff, Pilipinas Hino, Inc., is a corporation duly
organized and existing under the laws of the Philippines,
with office address at PMI Building EDSA, Mandaluyong,
Metro Manila, The plaintiff filed an action for sum of money
and damages against the defendants.
The contract of lease was entered into between
herein parties, under which the defendants, as lessor,
leased real property located at Bigaa, Balagtas Bulacan, to
plaintiff for a term of 2 years. Pursuant to the contract of
lease, plaintiff-lessee deposited with the defendants-lessor
the amount of P400, 000.00 to answer for repairs and
damages that may be caused by the lessee on the leased
premises during the period of the lease. After the
expiration of the lease contract, the plaintiff and
defendants made a joint inspection of the premises to
determine the extent of the damages thereon. Both agreed
that the cost of repairs would amount to P60, 000.00 and

that the amount of P340, 000.00 shall then be returned by

the defendants to plaintiff. However, defendants returned
to plaintiff only the amount of P200, 000.00 still having a
balance of P140, 000.00.
On August 10, 1990, plaintiff and defendants entered
into a contract to sell denominated as a memorandum of
agreement to sell whereby the latter agreed to sell to the
former the leased property subject of this suit in the
amount of P45, 611,000.00. The aforesaid memorandum of
agreement to sell granted the owner (defendants) the
option to rescind the same upon failure of the buyer
(plaintiff) to pay any of the six installments with the
corresponding obligation to return to the buyer any amount
paid by the buyer in excess of the down payment. Pursuant
to the said memorandum of agreement, plaintiff remitted
on August 10, 1990 to the defendants the amount of P1,
811,000.00 as down payment. Subsequently, plaintiff paid
the first and second installments in the amount of P1,
800,000.00 and P5, 250,000.00 with the total amount of P7,
050,000.00. Unfortunately, plaintiff failed to pay the third
and subsequent installments; and thereupon, defendants
decided to, and in fact did rescind and terminate, the
contract promised to return to the plaintiff all the amounts
paid in excess of the down payment after deducting the
interest due from the third to sixth installments, inclusive.
The trial court rendered a decision ruling in favor of
respondents Reyes, et. al. Petitioner Pilipinas Hino elevated
the case to the Court of Appeals. The appellate court,
however, sustained the findings of the trial court.
ISSUE:
Whether or not the private respondent has the right
to retain the interest due for the unpaid installments,
despite the fact that the respondent has exercised his
option to rescind the memorandum of agreement.
HELD:

In justifying the withholding of the amount of P924,

000.00 representing the interest due of the unpaid
installments, both the trial and the appellate court relied on
paragraph 6 of the memorandum of agreement entered into
by the parties. However, both courts failed to consider
paragraph 9 contained in the same memorandum of
agreement which provides in very clear terms that when
the owners exercise their option to forfeit the down
payment, they shall return to the buyer any amount paid by
the buyer in excess of the down payment with no obligation
to pay interest thereon. This should include all amounts
paid, including interest. Had it been the intention of the
parties to exclude the interest from the amount to be
returned to the buyer in the event that the owner exercises
its option to terminate or rescind the agreement, then such
should have been stated in categorical terms. Thus, there is
no basis in the conclusion reached by the lower courts that
interest paid should not be returned to the buyer.
Moreever, the private respondents withholding of the
amount corresponding to the interest violated the specific
and clear stipulation in paragraph 9 of the memorandum of
agreement that except for the down payment, all amounts
paid shall be returned to the buyer with no obligation to
pay interest thereon. The parties are bound by their
agreement. Thus Article 1159 of the Civil Code expressly
provides: Obligation arising from contracts have the force
of law between the contracting parties and should be
complied with in good faith.
PHILIPPINE REALTY and HOLDING CORP. v. LEY CONST. and
DEV. CORP.
G. R. No. 165548, June 13, 2011
FACTS:
Ley Construction and Development Corporation (LCDC) was the
project contractor for the construction of several buildings for Philippine
Realty & Holdings Corporation (PRHC), the project owner. Engineer

Dennis Abcede (Abcede) was the project construction manager of PRHC,

while Joselito Santos (Santos) was its general manager and vice-president
for operations.
Sometime between April 1988 and October 1989, the two
corporations entered into four major construction projects, as evidenced by
four duly notarized "construction agreements." These were the four
construction projects the parties entered into involving a Project 1, Project
2, Project 3 (all of which involve the Alexandra buildings) and a Tektite
Building. LCDC committed itself to the construction of the buildings
needed by PRHC, which in turn committed itself to pay the contract price
agreed upon. In the course of the construction of the Tektite Building, it
became evident to both parties that LCDC would not be able to finish the
project within the agreed period. LCDC explained that the unanticipated
delay in construction was due mainly to the sudden, unexpected hike in the
prices of cement and other construction materials. Both parties agreed to
enter into another agreement. Abcede asked LCDC to advance the amount
necessary to complete construction. Its president acceded, on the absolute
condition that it be allowed to escalate the contract price. Abcede replied
that he would take this matter up with the board of directors of PRHC.The
board of directors turned down the request for an escalation agreement.
However, On 9 August 1991 Abcede sent a formal letter to LCDC, asking
for its conformity, to the effect that should it infuse P36 million into the
project, a contract price escalation for the same amount would be granted in
its favor by PRHC.
LCDC then proceeded with the construction of the Tektite Building,
expending the entire amount necessary to complete the project. From
August to December 1991, it infused amounts totaling P 38,248,463.92.
These amounts were not deposited into the joint account of LCDC and
PRHC, but paid directly to the suppliers upon the instruction of
Santos.LCDC religiously submitted to PRHC monthly reports that
contained the amounts of infusion it made from the period August 1991 to
December 1991. PRHC never replied to any of these monthly reports.On 20
January 1992, LCDC wrote a letter addressed to Santos stating that it had
already complied with its commitment as of 31 December 1991 and was
requesting the release of P 2,248,463.92.
In a letter dated 18 January 1993, LCDC, through counsel,
demanded payment of the agreed escalation price of P 36 million. In its

reply on 16 February 1993, PRHC suddenly denied any liability for the
escalation price. In the same letter, it claimed that LCDC had incurred 111
days of delay in the construction of the Tektite Building and demanded that
the latter pay P 39,326,817.15 as liquidated damages.
ISSUE:
Whether or not LCDC was delayed in the performance of its
obligation to construct the buildings for PRHC .
HELD:
The Court held that A subsequent escalation agreement was validly
entered into by the parties, but only to the extent of P 36 million. LCDC
was able to establish that Abcede and Santos, on behalf of PRHC, had
signed the letter-agreement containing the stipulation on the escalation.
PRHC does not question the validity of these agreements; it thereby
effectively admits that these two individuals had actual authority to sign on
its behalf with respect to these construction projects. Thus, the lack of
authority on their part should not be used to prejudice it, considering that
the two were clothed with apparent authority to execute such agreements. In
addition, PRHC is allegedly barred by promissory estoppel from denying
the claims of the other corporation.
The Court further held that LCDC is not liable for liquidated
damages for delay in the construction of the buildings for PRHC. There is
no question that LCDC was not able to fully construct the Tektite Building
and Projects 1, 2, and 3 on time. The shortage in supplies and cement may
be characterized as force majeure. In the present case, hardware stores did
not have enough cement available in their supplies or stocks at the time of
the construction in the 1990s.
TITAN-IKEDA VS. PRIMETOWN
G.R No. 158768
February 12, 2008

The respondent Primetown Property Corporation entered into

contract weith the petitioner Titan-Ikeda Construction Corporation for the
structural works of a 32-storey prime tower. After the construction of the
tower, respondent again awarded to the petitioner the amount of P
130,000,000.00 for the towers architectural design and structure.
Howevere, in 1994, the respondent entered inot a contract of sale of the
tower in favor of the petitioner in a manner called full-swapping. Since the
respondent had allegedly constructed almost one third of the project as
weel as selling some units to third persons unknown to the petitioner.
Integrated Inc. took over the project, thus the petitioner is demanding for
the return of its advanced payment in the amount of P2, 000,000.00 as weel
as the keys of the unit.
ISSUE:
Whether the petitioner is entitled to damages.
RULING:
No, because in a contract necessarily that there is a meeting of the
minds of the parties in which this will be the binding law upon them. Thus,
in a reciprocal obligation. Both parties are obliged to perform their
obligation simultaneously and in good faith. In this case, petitioner, TitanIkeda can not recover damages because it was found out there was no
solutio indebiti or mistake in payment in this case since the latter is just
entitled to the actual services it rendered to the respondent and thus it is
ordered to return the condominium units to the respondent.
PADCOM Condominium Corporation vs. Ortigas Center Association,
Inc.,
G.R. No. 146807, May 9, 2002

FACTS:
FACTS:

Petitioner Padcom Condominium Corporation (hereafter

PADCOM) owns and manages the Padilla Office Condominium Building
(PADCOM Building) located at Emerald Avenue, Ortigas Center, Pasig
City. The land on which the building stands was originally acquired from
the Ortigas & Company, Limited Partnership (OCLP), by Tierra
Development Corporation (TDC) under a Deed of Sale dated 4 September
1974. Among the terms and conditions in the deed of sale was the
requirement that the transferee and its successor-in-interest must become
members of an association for realty owners and long-term lessees in the
area later known as the Ortigas Center. Subsequently, the said lot, together
with improvements thereon, was conveyed by TDC in favor of PADCOM in
a Deed of Transfer dated 25 February 1975.
In 1982, respondent Ortigas Center Association, Inc. (hereafter the
Association) was organized to advance the interests and promote the
general welfare of the real estate owners and long-term lessees of lots in the
Ortigas Center. It sought the collection of membership dues in the amount
of two thousand seven hundred twenty-four pesos and forty centavos (P2,
724.40) per month from PADCOM. The corporate books showed that
PADCOM owed the Association P639, 961.47, representing membership
dues, interests and penalty charges from April 1983 to June 1993. The
letters exchanged between the parties through the years showed repeated
demands for payment, requests for extensions of payment, and even a
settlement scheme proposed by PADCOM in September 1990.
In view of PADCOM's failure and refusal to pay its arrears in monthly dues,
including interests and penalties thereon, the Association filed a complaint
for collection of sum of money before the trial court. The Association
averred that purchasers of lands within the Ortigas Center complex from
OCLP are obligated under their contracts of sale to become members of the
Association. This obligation was allegedly passed on to PADCOM when it
bought the lot from TDC, its predecessor-in-interest.
The trial court dismissed the case. However, the Court of Appeals reversed
the same in favor of the Association.
ISSUE:
Whether or not PADCOM is a member of the Ortigas Center
Association, Inc.

HELD:
As a lot owner, PADCOM is a regular member of the Association.
No application for membership is necessary. If at all, acceptance by the
Board of Directors is a ministerial function considering that PADCOM is
deemed to be a regular member upon the acquisition of the lot pursuant to
the automatic membership clause annotated in the Certificate of Title of the
property and the Deed of Transfer. PADCOMs contention that the
automatic membership clause is a violation of its freedom of association
because it was never forced to join the association is likewise untenable.
Nobody forced it to buy the land when it bought the building with the
annotation of the condition or lien on the Certificate of Title thereof and
accepted the Deed. PADCOM voluntarily agreed to be bound by and
respect the condition, and thus to join the Association.
Having ruled that PADCOM is a member of the Association, it is obligated
to pay its dues incidental thereto as mandated by Article 1159 of the Civil
Code which states that obligations arising from contracts have the force of
law between the contracting parties and should be complied with in good
faith.
Assuming in gratis argumenti that PADCOM is not a member of the
Association, it cannot evade payment without violating the equitable
principles underlying quasi-contracts. Article 2142 of the Civil Code
provides that certain lawful, voluntary and unilateral acts give rise to the
juridical relation of quasi-contract to the end that no one shall be unjustly
enriched or benefited at the expense of another.
MC Engineering, Inc., vs. Court of Appeals
G.R. No. 104047, April 3, 2002
380 SCRA 116
FACTS:
Mc Engineering, Inc. and Surigao Coconut Development
Corporation signed a contract, for the restoration of the latters building,
land improvement, electrical, and mechanical equipment located at Lipata,
Surigao City, which was damaged by typhoon Nitang. Defendant Mc
Engineering and plaintiff Gerent Builders, Inc. entered into an agreement

wherein defendant subcontracted to plaintiff the restoration of the buildings

and land improvement phase of its contract with Sucodeco.
On January 2, 1985, plaintiff received from defendant the amount of P1,
339,720.00 as full payment of the sub-contract price, after deducting earlier
payments made by defendant to plaintiff, as evidenced by the affidavit
executed by plaintiffs president, Mr. Narciso C. Roque, wherein the latter
acknowledged complete satisfaction for such payment on the basis of the
Statement of Account which plaintiff had earlier forwarded to defendant.
Nevertheless, plaintiff is still claiming from defendant the sum of P632,
590.13 as its share in the adjusted contract cost in the amount of P854,
851.51, alleging that the sub-contract is subject to the readjustment
provided for in Section VII of the agreement, and also the sum of P166,
252.00 in payment for additional electrical and civil works outside the
scope of the sub-contract. Petitioner refused to pay respondent Gerent.
Thus, on March 21, 1985, respondent Gerent filed the complaint against
petitioner. On March 28, 1985, the trial court issued the corresponding writ
of preliminary attachment upon the filing by respondent Gerent of a P632,
590.13 bond issued by respondent Surety. On April 24, 1985, petitioner
moved to quash the writ on the ground that it was improperly issued. The
trial court denied the motion.
On July 13, 1987, the trial court ordered the return of petitioners properties
that deputy sheriff Cristobal C. Florendo attached and seized. The sheriff
reported to the court that he never seized a single property of petitioner but
merely conducted a paper levy.
On January 5, 1988, petitioner filed an application against the attachment
bond to recover damages it suffered due to the wrongful issuance of the writ
of attachment. Respondent Surety opposed the application.
In its Answer, petitioner vigorously denied respondent Gerents causes of
action. Petitioner counterclaimed for damages and attorneys fees due to
the improper issuance of the writ of attachment.
ISSUE:
Whether or not petitioner is entitled to actual moral and exemplary
damages due to the wrongful issuance of the writ of preliminary attachment.
HELD:

Since no moral damages is due to appellee and it appearing that no

actual damages was awarded by the lower court, the grant of exemplary
damages has no leg on which to stand (Art. 2234, Civil Code).
If at all, the wrongful issuance of the writ of attachment, as ruled out by this
Court, merely resulted in actual damages to appellee. But such is not
automatically awarded for it is subject to proof. Appellees claim that it lost
major contracts after a credit investigation revealed that its accounts were
garnished is a bare allegation not merely unsupported by solid evidence but
is also speculative. The alleged $35,000.00 remittance refused by the
Hongkong and Shanghai Bank does not inspire belief for failure of appellee
to produce documentary proof to buttress its claim.
We agree with the Court of Appeals that the trial court erred in awarding
moral and exemplary damages to petitioner. The mere fact that a complaint
is dismissed for lack of legal basis will not justify an award of moral
damages to the prevailing party. Even the dismissal of a clearly unfounded
civil action or proceeding will not entitle the winning party to moral
damages. For moral damages to be awarded, the case must fall within the
instances enumerated in Article 2219, or under Article 2220, of the Civil
Code. Moreover, in the absence of fraud, malice, wanton recklessness or
oppressiveness, exemplary damages cannot be awarded.
Bank of the Philippine Islands vs. Benjamin Pineda
G.R.No. L-62441, December 14, 1987
156 SCRA 404
FACTS:
Through financing of Peoples Bank and Trust Company, now BPI,
three vessels were bought by Southern Industrial Project (SIP) and/or
Bacong Shipping Company. SIP is a corporation whose majority
stockholder belongs to Concon Family. Bacong Shipping Company is a
Panamanian corporation. The said vessels were mortgaged to the bank as a
security of their payment of their bank loans.
Interocean Shipping Corporation, a booking agency, handled the
operation of said vessels. It undertook the freight revenues from their
charter and operation which shall be deposited with Trust Department of

PBTC and disbursements made therefrom shall be covered by vouchers

bearing the approval of SIP.
SIP and PBTC became doubtful of the amount of revenues being
deposited with the bank as diversions of payments were being made.
Gregorio Concon of SIP and/or Bacong and Ramon Azanza of PBTC
organized SA Gacet Inc. to manage and supervise the vessels operation
with Ezekiel Toeg as its manager. A management contract was entered into
between SIP and Gacet Inc. placing the supervision and management of said
vessels in the hands of Gacet for a specified period, renewable at the will of
the parties without however terminating the booking agency of Interocean
Shipping Corp. Gacet and Interocean, in accordance with the management
contract, contracted services of Benjamin Pineda doing business in the
name and style Pioneer Iron Works to carry out repairs, fabrication and
installation of necessary parts in said vessels in order to make them
seaworthy and in good working condition.
Unable to pay their mortgage indebtedness to PBTC hich became
past due, SIP and/or Bacong sold said vessels to PBTC by way of dacion en
pago.Pineda filed an action against SIP, Gacet, Interocean and PBTC for
payment and interest of the cost of repairs, fabrication and installation of
necessary parts of the vessels.

exercise his right of retention under 1731 of the Civil Code. The checks
were dishonored thus the private respondent could not give validity to
petitioners argument that the former has waived or abandoned his liens on
the vessels. To pursue such view would put a premium on an act of
deception which led private respondent to believe that he will be fully paid.
Furthermore, when the checks were dishonored, it was impossible for
private respondent to enforce his liens because the vessels were already in
Japan, outside the territorial jurisdiction of Philippine waters. If there was
no intention on the part of PBTC (BPI) to assume responsibility for these
obligations at the time of the sale of the vessels, there is no sense in
executing said Deed of Confirmation together with the Deeds of Sale and
the stipulations thereunder would be pointless.
The repairs made on the vessels ultimately redounded to the benefit
of the new owner (BPI) for without said repairs, those vessels would not be
seaworthy. Under Article 2124 of the Civil Code, such acts give rise to the
juridical relation of quasi-contract to the end that no one shall be unjustly
enriched or benefited at the expense of another.The petitioner bank is
answerable to Pineda for the services contracted on the vessels.
State Investment vs. Court of Appeals
G.R. No. 90676, June 19, 1991
198 SCRA 392

ISSUE:
Who should be liable for the payment of the cost of repairs
undertaken in the subject vessels?
HELD:

FACTS:

The Deed of Confirmation of Obligation is but a part or corollary to

the Deeds of Sale of the vessels. In fact, specific reference thereto was
made by said Deeds of Sale as to the settlement of obligations, among
which are repairs in question. The stipulation with the Deed of
Confirmation leaves no room for doubt while the bank may indeed pay
certain obligations. The primary purpose of the contracts is the protection
of the vessels. Among them are liens on the same under which the
obligation to private respondent properly belongs.
Private respondent was paid certain sum of money and its balance
through the issuance of three checks by Interocean. Under the
circumstances, private respondent has no basis or necessity at that time to

Respondent spouses Rafael and Refugio Aquino pledged certain

shares of stock to petitioner State Investment House Inc. in order to secure a
loan of P120, 000.00. Prior to the execution of the pledge, respondent
spouses Jose and Marcelina Aquino signed an agreement with Petitioner for
the latters purchase of receivables amounting to P375, 000.00. When the
1st Account fell due, respondent spouses paid the same partly with their
own funds and partly from the proceeds of another loan which they
obtained also from Petitioner designated as the 2nd Account. This new loan
was secured by the same pledge agreement executed in relation to the 1st
Account. When the new loan matured, State demanded payment.

Respondents expressed willingness to pay, requesting that upon payment,

the shares of stock pledged be released. State denied the request on the
ground that the loan which it had extended to the spouses Jose and
Marcelina Aquino has remained unpaid.
On 29, June 1984, Atty. Rolando Salonga sent to respondent spouses
a Notice of Notarial Sale stating that upon request of State and by virtue of
the pledge agreement, he would sell at public auction the shares of stock
pledged to State. This prompted respondents to file a case before the
Regional Trial Court of Quezon City alleging that the intended foreclosure
sale was illegal because from the time the obligation under the 2nd Account
became due, they had been able and willing to pay the same, but petitioner
had insisted that respondents pay even the loan account of Jose and
Marcelino Aquino, which had not been secured by the pledge. It was further
alleged that their failure to pay their loan was excused because State itself
had prevented the satisfaction of the obligation.
On January 29, 1985, the trial court rendered a decision in favor of
the plaintiff ordering State to immediately release the pledge and to deliver
to respondents the share of stock upon payment of the loan. The Court of
Appeals affirmed in toto the decision of the trial court.
ISSUES:
Whether or not the conditions to be complied with by the debtor
desirous of being released from his obligation in cases where the creditor
unjustly refuses to accept payment have been met by the spouses Aquino.
HELD:
The conditions had not been complied with. Article 1256 of the civil
code states that: If the creditor to whom tender of payment has been made
refuses without just cause to accept it, the debtor shall be released from
responsibility by consignation of the thing or sum due. Where the creditor
unjustly refuses to accept payment, the debtor desirous of being released
from his obligation must comply with two (2) conditions: (a) tender of
payment; and (b) consignation of the sum due. Tender of payment must be

accompanied or followed by consignation in order that the effects of

payment may be produced. In the instant case, respondent spouses Aquino,
while they are properly regarded as having made a written tender of
payment to petitioner state, failed to consign in court the amount due at the
time of the maturity of the 2nd Account No. It follows that their obligation
to pay principal-cum-regular or monetary interest under the terms and
conditions of the said Account was not extinguished by such tender of
payment alone.

ABELLANA V. PEOPLE
G.R. No. 174654, August 17, 2011
FACTS:
In 1985, petitioner Felixberto A. Abellana extended a loan to private
respondents spouses Diaga and Saapia Alonto (spouses Alonto), secured by
a Deed of Real Estate Mortgage over Lot Nos. 6471 and 6472 located in
Cebu City.Subsequently, or in 1987, petitioner prepared a Deed of Absolute
Sale conveying said lots to him. The Deed of Absolute Sale was signed by
spouses Alonto in Manila. However, it was notarized in Cebu City
allegedly without the spouses Alonto appearing before the notary public.
Thereafter, petitioner caused the transfer of the titles to his name and sold
the lots to third persons.On August 12, 1999, respondent spouses filed a
complaint charging petitioner with Estafa through Falsification of Public
Document.
The RTC found that petitioner did not intend to defraud the
spouses Alonto and that petitioner can only be held guilty of Falsification
of a Public Document by a private individual under Article 172(1)in relation
to Article 171(2) of the Revised Penal Code and not Estafa through
falsification of public document as charged in the Information.

Petitioner, upon appeal, raised the issue of whether an

accused who was acquitted of the crime charged may nevertheless be
convicted of another crime or offense not specifically charged and alleged
and which is not necessarily included in the crime or offense charged. The
CA held that petitioner who was charged with and arraigned for estafa
through falsification of public document under Article 171(1) of the RPC
could not be convicted of Falsification of Public Document by a Private
Individual under Article 172(1) in relation to Article 171(2). Thus, the CA
opined that the conviction of the petitioner for an offense not alleged in the
Information or one not necessarily included in the offense charged violated
his constitutional right to be informed of the nature and cause of the
accusation against him. Nonetheless, the CA affirmed the trial court's
finding with respect to petitioner's civil liability.

presumption of the truthfulness of the statements contained in the deed. And

since the defective notarization does not ipso facto invalidate the Deed of
Absolute Sale, the transfer of said properties from spouses Alonto to
petitioner remains valid. Hence, when on the basis of said Deed of
Absolute Sale, petitioner caused the cancellation of spouses Alonto's title
and the issuance of new ones under his name, and thereafter sold the same
to third persons, no damage resulted to the spouses Alonto.

ISSUE:

PEOPLE VS. MALICSI

G.R No. 175833
January 29, 2008

Whether or not petitioner could still be held civilly liable

notwithstanding his acquittal.
HELD:
NO. It is an established rule in criminal procedure that a
judgment of acquittal shall state whether the evidence of the prosecution
absolutely failed to prove the guilt of the accused or merely failed to prove
his guilt beyond reasonable doubt. The "extinction of the penal action does
not carry with it the extinction of civil liability unless the extinction
proceeds from a declaration in a final judgment that the fact from which the
civil liability might arise did not exist."
Civil liability arises when one, by reason of his own act or
omission, done intentionally or negligently, causes damage to another.
Hence, for petitioner to be civilly liable to spouses Alonto, it must be
proven that the acts he committed had caused damage to the spouses.Based
on the records of the case, we find that the acts allegedly committed by the
petitioner did not cause any damage to spouses Alonto.
Even assuming that the spouses Alonto did not personally
appear before the notary public for the notarization of the Deed of Absolute
Sale, the same does not necessarily nullify or render void ab initio the
parties' transaction. Such non-appearance is not sufficient to overcome the

FACTS:
The accused-appellant was accused for the crime of rape against his
niece. The incident was repeated trice by the appellant. The appellant
contended that he and the victim were sweethearts but the trial court did not
give weight to that theory.
The trial court found appellant guilty of the crime of four counts of
qualified rape and was sentenced to suffer the penalty of death for each
count of rape, to pay P300,000.00 as civil indemnity (P75,000.00 for each
count), and P200,000.00 as moral damages (P50,000.00 for each count).
The CA however modified the findings of the RTC declaring that appellant
is guilty of four counts of simple rape and to suffer the penalty of reclusion
perpetua.
ISSUE:

Whether the award of damages was properly made.

RULING:
No, because the Supreme Court declared that the crime committed
was four count of simple rape only and not qualified rape because the
special aggravating circumstances of minority and relationship must be
alleged in the information but the prosecution failed to do so. Since it is not
included, four counts of simple rape should be undertaken. The penalty
imposed then should be reclusion perpetua. The appellate court also
correctly affirmed the award by the trial court of P200,000.00 for moral
damages. Moral damages are automatically granted to rape victim.
However, the award of civil indemnity is reduced to P200,000.00 in the
amount of P50,000.00 for each count of simple rape is automatically
granted.
People of the Philippines vs. Rosauro Sia
G.R. No. 137457, November 21, 2001
370 SCRA 123
FACTS:
This is an automatic review of a decision of the Regional Trial Court
finding the accused Johnny Balalio y Deza and Jimmy Ponce y Tol guilty
beyond reasonable doubt as principals by conspiracy for violation of RA
6539 (Anti- Carnapping law) as amended, and sentenced them to suffer the
penalty of death.
Accused are likewise adjudged jointly and severally liable to pay
Agripina Bermudez, the mother of the deceased Christian Bermudez the
sums of: (a) P50, 000.00 as compensatory damages for the death of
Christian Bermudez; (b) P200, 000.00 as burial and other expenses incurred
in connection with the death of Christian; and (c) P3, 307,199.60 (2/3 x [80-

27] x 300 per day x 26 days (excluding Sundays) x 12 months) representing

the loss of earning capacity of Christian Bermudez as taxi driver.
ISSUE:
The issue is whether or not the trial courts award for damages is
proper.
HELD:
The decision is partly correct. The Court finds the amount of P50,
000.00 as death indemnity proper, following prevailing jurisprudence, and
in line with controlling policy. The award of civil indemnity may be granted
without any need of proof other than the death of the victim. Though not
awarded by the trial court, the victims heirs are likewise entitled to moral
damages, pegged at P50, 000.00 by controlling case law, taking into
consideration the pain and anguish of the victims family brought about by
his death.
However, the award of P200, 000.00 as burial and other expenses
incurred in connection with the death of the victim must be deleted. The
records are bereft of any receipt or voucher to justify the trial courts award
of burial and other expenses incurred in connection with the victims death.
The rule is that every pecuniary loss must be established by credible
evidence before it may be awarded. Credence can be given only to claims,
which are duly supported, by receipts or other credible evidence.
The trial court was correct in awarding damages for loss of earning
capacity despite the non-availability of documentary evidence. The court
based on testimony in several cases has awarded damages representing net
earning capacity. However the amount of the trial courts award needs to be
re computed and modified accordingly.
In determining the amount of lost income, the following must be
taken into account: (1) the number of years for which the victim would
otherwise have lived; and (2) the rate of the loss sustained by the heirs of
the deceased. The second variable is computed by multiplying the life
expectancy by the net earnings of the deceased meaning total earnings less
expenses necessary in the creation of such earnings or income less living

and other incidental expenses considering that there is no proof of living

expenses of the deceased, net earnings are computed at fifty percent of the
gross earnings.
In this case, the court notes that the victim was 27 years old at the
time of his death and his mother testified that as a driver of the Tamaraw FX
taxi, he was earning P650.00 a day.
Based on the foregoing computation, the award of the trial court with regard
to lost income is thus modified accordingly.
The court ordered the accused to pay the heirs of the victim Christian
Bermudez the sum of P50, 000.000 as civil indemnity, the sum of P50,
000.00 as moral damages, and the sum of P2, 996,867.20 representing lost
earnings. The award of P200, 000.00 as burial and other expenses is deleted
for lack of substantial proof.

HELD:
The Supreme Court modified the award for damages by the trial
court. It reduced the award to P112, 413.40 representing funeral expenses,
which were duly proven and covered by receipts Expenses relating to the
9th day, 40th day and 1st year anniversaries cannot be considered in the
award of actual damages as these were incurred after a considerable lapse of
time from the burial of the victim. With respect to the award of moral
damages, the same is reduced to P50, 000.00 in accordance with existing
jurisprudence.
Based on the above modifications the court ordered the accused to
pay the heirs of the victim P112, 413.40 as actual damages P50, 000.00 as
civil indemnity, and P50, 000.00 as moral damages plus costs.

People of the Philippines vs. Carlos Doctolero, Sr

G.R. No. 131866, August 20, 2001
363 SCRA 404

People of the Philippines vs. Rolly Abulencia

G.R. No. 138403, August 22, 2001
363 SCRA 496

FACTS:
FACTS:
This is an appeal of the accused from the decision of the Regional
Trial Court of Baguio City finding him guilty beyond reasonable doubt of
the crime of murder and ordering him to indemnify the heirs of the victim
the sum of P50, 000.00 as indemnity for his death; the sum of P227, 808.80
as actual damages for expenses incurred for hospitalization, doctors fees,
funeral expenses, vigil and burial as a result of his death, and P300, 000.00
as moral damages for the pain and mental anguish suffered by the heirs by
reason of his death, all indemnifications being without subsidiary
imprisonment in case of insolvency, and to pay the costs.

This is an automatic review of a decision of the Regional Trial Court

of Urdaneta City, Pangasinan finding the accused guilty beyond reasonable
doubt of the crime of Aggravated Rape with Homicide sentencing the
accused to suffer the penalty of death, and ordering him to indemnify the
heirs of the victim, the sum of P75, 000.00 damages, and another sum of
P20, 000.00 for exemplary damages plus P6, 425.00 as actual damages.
ISSUE:

ISSUE:
Whether or not the trial courts award for damages is proper.
Whether or not the trial courts award of damages is proper.
HELD:

The Supreme Court modified the trial courts award for damages.
The trial court awarded only 75,000.00 as civil indemnity, but current
jurisprudence has fixed at P100, 000.00 the civil indemnity in cases of rape
with homicide, which is fully justified and properly commensurate with the
seriousness of the special complex crime.
The trial court did not award moral damages to the victims family.
Based on prevailing jurisprudence, moral damages may be awarded to the
heirs of the victim without need for pleading or proof of its basis for their
mental, physical and psychological sufferings are too obvious to still require
their recital at the trial. Hence, moral damages in the amount of P50, 000.00
must be awarded.
In People v. Lagarto, the court held that attendant circumstances
may be considered to determine civil liability. Thus, in view of the evident
cruelty inflicted upon the victim, as shown by the multiple burns and
contusions on her body, the court granted the award of exemplary damages
in the amount of P25, 000.00.
Based on the above modifications, the Court ordered the accused to
pay the heirs of the victim P100, 00.00 as civil indemnity; P50, 000.00 as
moral damages; P25, 000.00 as exemplary damages; and P6, 425.00 as
actual damages.
Reynaldo Bermudez vs. Hon. Judge A. Melencio-Herrera
G.R. No. L-32055, February 26, 1988
158 SCRA 168

Office. Plaintiff-appellants filed in the said criminal case A Reservation to

File Separate Civil Action.
Subsequently, the plaintiff-appellants filed a civil case for damages
with the Court of First Instance of Manila. Finding that the plaintiffs
instituted the action on the assumption that defendant Pontinos negligence
in the accident constituted a quasi-delict, the trial court stated that the
plaintiffs had already elected to treat the accident as a crime by reserving
in the criminal case the right to file a separate civil action. That being so,
the trial court decided to order the dismissal of the complaint against
defendant Cordova Ng Sun Kwan and to suspend the hearing of the case
against Domingo Pontino until after the criminal case for Homicide
Through Reckless Imprudence is finally terminated. From said order,
plaintiffs filed the present appeal.
ISSUE:
Whether or not the plaintiff-appellants had already elected to treat
the accident as a crime by reserving in the criminal case the right to file a
separate civil action.
HELD:
According to the Supreme Court, in case of negligence, the injured
party or his heirs has a right to choose between an action to enforce civil
liability arising from crime under Article 100 of the Revised Penal Code
and an action for quasi-delict under Article 2176-2194 of the Civil Code. If
the party chooses the latter, he may hold the employer solidarily liable for
the negligent act of his employee, subject to the employers defense of
exercise of the diligence of a good father of the family.

FACTS:
A cargo truck driven by Domingo Pontino and owned by Cordova
Ng Sun Kwan bumped a jeep on which Rogelio, a six-year old son of
plaintiff-appellants, was riding. The boy sustained injuries which caused his
death. As a result, a criminal case for Homicide through Reckless
Imprudence was filed against Domingo Pontino by the Manila City Fiscals

In the case at bar, the action filed by appellant was an action for
damages based on quasi-delict. The fact that appellants reserved their right
in the criminal case to file an independent civil action did not preclude them
from choosing to file a civil action for quasi-delict.
People of the Philippines vs. Relova

G.R. No. L-45129, March 6, 1987

148 SCRA 293
FACTS:
On February 1, 1975, members of the Batangas City Police together
with personnel of the Batangas Electric Light System, equipped with a
search warrant, searched the premises of the Opulencia Carpena Ice Plant
and Cold Storage owned and operated by private respondent Manuel
Opulencia. The police discovered that electric wiring devices and
contraptions had been installed without the necessary authority from the
city government. These electric devices were designed purposely to lower
or decrease the readings of electric consumption in the electric meter of the
said electric and cold storage ice plant.
Consequently, an Assistant City Fiscal of Batangas filed an
information against Opulencia for violation of Ordinance No. 1 Series of
1974, Batangas City. However, subsequently, the accused filed a motion to
dismiss the information upon the grounds that the crime there charged had
already prescribed.
Fourteen (14) days later, the Acting City Fiscal of Batangas filed
before the Court of First Instance of Batangas another information against
Opulencia this time for theft of electric power under Article 308 in relation
to Article 309 of the Revised Penal Code. However, the case was likewise
dismissed on the ground of the constitutional right against double jeopardy.
As regards the civil aspect of the case, no right to file a separate civil action
was filed by the Batangas City Electric Light System.
ISSUE:
Whether or not the extinction of criminal liability whether by prescription
or by the bar of double jeopardy carries with it the extinction of civil
liability based on the offense charged.

HELD:
In the present case, accused Opulencia freely admitted during the
police investigation having stolen electric current through the installation
and use of unauthorized electric connections or devices. While the accused
pleaded not guilty before the City Court of Batangas City, he did not deny
having appropriated electric power. However, there is no evidence in the
record as to the amount or value of the electric power appropriated by the
accused. Accordingly, the civil action which has not been waived impliedly
or expressly should be remanded to the Court of First Instance of Batangas
City for reception of evidence on the amount or value of the electric power
appropriated and converted by Manuel Opulencio and rendition of judgment
conformably with such evidence.
Manantan vs. Court of Appeals
G.R. No. 107125, January 29, 2001
350 SCRA 387
FACTS:
After going from one place to another and consuming large amounts
of beer, the accused, the deceased, and two others boarded on the car of the
accused where he was the driver. Driving at a high speed at the middle
portion of the highway and trying to overtake tricycle. At such speed, the
accused was not able to avoid the passenger jeepney and thus collided with
it. The accused immediately tried to swerve the car to the right and move
his body away from the steering wheel but he was not able to avoid the
oncoming vehicle and the two vehicles collided with each other at the
center of the road.
The trial court decided in favor of the accused. However, the Court
of Appeals modified the decision of the lower court, in that defendantappellee is held civilly liable for his negligent and reckless act of driving his
car which was the proximate cause of the vehicular accident and sentenced
to indemnify plaintiff-appellants in the amount of P174, 400.00 for the
death of Ruben Nicolas

ISSUES:
(1)
Whether or not the trial court erred in finding that petitioners
acquittal did not extinguish his civil liability.
(2)
Whether or not the Court a quo erred in finding that petitioners
acquittal did not extinguish his civil liability.
(3)
Whether or not the appellate court committed reversible error in
finding to apply the Manchester doctrine.

promulgated on January 31, 1992, as well as its resolution dated August 24,
1992, denying herein petitioner's motion for reconsideration, are
AFFIRMED. Costs against petitioner.

HELD:
The court of appeals in determining whether Article 29 of the Civil
Code applied was not precluded by the petitioners acquittal, from looking
into the question of petitioners negligence or reckless imprudence. What
was elevated to the Court of Appeals by private respondents was the civil
aspect of Criminal Case No. 066. Petitioner was not charged anew with a
second criminal offense identical to the first offense. Therefore, there was
no second jeopardy to speak of.
The decision in Criminal Case No 066 supports the conclusions of
the appellate court that the acquittal was based on reasonable doubt; hence,
the civil liability was not extinguished by his discharge. It clearly shows
that petitioners acquittal was predicated on the conclusion that his guilt had
not been established with moral centainty.
At the time of the filing of the information in 1983, the implied institution
of civil actions with criminal actions was governed by Rule III, Section 1 of
the 1964 Rules of Court. Where the civil action is impliedly instituted
together with the criminal action, the actual damages claimed by the
offended parties, as in this case, are not included in the computation of the
filing fees. Filing fees are to be paid only if other items of damages such as
moral, nominal, temperate or exemplary damages are alleged in the
complaint or information, or if they are not so alleged, shall constitute a first
lien on the judgment. The filing fees are deemed paid from the filing of the
criminal complaint or information.
WHEREFORE, the instant petition is DISMISSED for lack of merit. The
assailed decision of the Court of Appeals in CA-G.R. CV No. 19240

People of the Philippines vs. Rogelio Bayotas

G.R. No. 102007, September 2, 1994
236 SCRA 239
FACTS:
Rogelio Bayotas was charged with rape and eventually convicted
thereof on June 19, 1991 in a decision penned by Judge Manuel Autajay.
Pending appeal of his conviction, Bayotas died on February 4, 1992 at the
National Bilibid Hospital due to cardio respiratory arrest. Consequently, the
Supreme Court in its resolution of May 20, 1992, dismissed the criminal
aspect of the appeal. However, it required the Solicitor General to file its
comment with regard to Bayotas civil liability arising from his commission
of the offense charged.
In his comment, the Solicitor General expressed his view that the
death of the accused did not extinguish his civil liability as a result of his
commission of the offense charged. The Solicitor General insists that the
appeal should still be resolved for the purpose of reviewing his conviction
by the lower court on which the civil liability is based.
Counsel of the accused, on the other hand, opposed the view of the
Solicitor General arguing that the death of the accused while pending appeal
extinguishes both his criminal and civil penalties. In support of his position,

said counsel invoked the ruling of the Court of Appeals in People v. Castillo
and Ocfemia which held that the criminal liability in a criminal case takes
root in the criminal liability; and therefore, civil liability is extinguished if
accused should die before final judgment is rendered.
ISSUE:
Whether or not the death of the accused pending appeal of his
conviction extinguishes his civil liability.
HELD:
In People v. Castillo, The Court resolved this issue stating Article 89
of the Revised Penal Code which states that criminal liability is totally
extinguished by the death of the convict. As to the personal penalties and as
to the pecuniary penalties, liability therefore is extinguished only when the
death of the offender occurs before final judgment.
The legal import of the term final judgment is similarly reflected in
the Revised Penal Code. Articles 72 and 78 of the legal body mention the
term final judgment in the sense that it is already enforceable. This also
brings to mind Section 7, Rule 116 of the Rules of Court which states that
the judgment in a criminal case becomes final after the lapse of the period
for perfecting an appeal or when the sentence has been partially or totally
satisfied or served, or the defendant has expressly waived in writing his
right to appeal.
Since the death of the accused occurred while his appeal is pending,
the decision has not yet become final and executory; thus, his civil liability
together with his criminal liability is extinguished. However, if the civil
obligation arises from other sources of obligation other than the crime
complained of, the civil liability of the accused survived in spite of his
death pending his appeal. A preponderance of evidence is sufficient to prove
his civil liability.

Fausto Barredo vs. Severino Garcia

G.R. No. L-48006, July 8, 1942
73 PHIL 607
FACTS:
At about half past one in the morning of May 3, 1936, on the road
between Malabon and Navotas, Province of Rizal, there was a head-on
collision between a taxi of the Malate Taxicab driven by Pedro Fontanilla
and a carretela guided by Pedro Dimapilis. The carretela was overturned,
and one of its passengers, 16-year-old boy Faustino Garcia, suffered injuries
from which he died two days later. A criminal action was filed against
Fontanilla in the Court of First Instance of Rizal and he was convicted and
sentenced to an indeterminate sentence of one year and one day to two years
of prision correctional. The court in the criminal case granted the petition
that the right to bring a separate civil action be reserved. The Court of
Appeals affirmed the sentence of the lower court in the criminal case.
Severino Garcia and Timotea Almario, parents of the deceased, brought an
action in the Court of First Instance of Manila against Fausto Barredo as the
sole proprietor of the Malate Taxicab and employer of Pedro Fontanilla. On
July 8, 1939, the Court of First Instance of Manila awarded damages in
favor of the plaintiffs for P2, 000.00 plus legal interest from the time the
action was instituted.

The main theory of the defense is that the liability of Fausto Barredo
is governed by the Revised Penal Code; hence, his liability is only
subsidiary, as there has been no civil action against Pedro Fontanilla, the
person criminally liable, Barredo cannot be held responsible in this case.

or employers who principally reap the profits resulting from the services of
their servants. It is but right that they should guarantee the latters careful
conduct for the personnel and patrimonial safety of the others.

However, the decision of the Court of Appeals expressed that the

liability sought to be imposed against Fausto Barredo is not a civil
obligation arising from a felony or a misdemeanor, but an obligation
imposed in Article 1903 of the Civil Code by reason of his negligence in the
selection or supervision of his servant or employee.
ISSUE:
Whether or not the plaintiffs may bring this separate civil action against
Fausto Barredo, thus making him primary and directly responsible under
Article 1903 of the Civil Code as the employer of Pedro Fontanilla.

PHILIPPINE HAWK CORP. v. TAN LEE

G.R. No. 166869
February 16, 2010
FACTS:

HELD:
A quasi-delict or culpa aquiliana is a separate and distinct legal
institution under the Civil Code with substantivity of it own, and
individuality that is entirely apart and independent from a delict or crime.
Upon this principle, the primary and direct responsibility of employers may
be safely anchored.
To hold that there is only one way to make the employers liability
effective, and that is, to sue the driver and exhaust his properties is
tantamount to compelling the plaintiff to follow a devious and cumbersome
method of obtaining relief. True, there is such a remedy under our laws, but
there is also an expeditious way, which is based on the primary and direct
responsibility of the employer under Article 1903 of the Civil Code.
At this juncture, it should be said that the primary and direct
responsibility of employers and presumed negligence are principles
calculated to protect society. Workmen and employees should be carefully
chosen and supervised in order to avoid injury to the public. It is the masters

On March 15, 2005, respondent Vivian Tan Lee filed before the RTC
of Quezon City a Complaint against petitioner Philippine Hawk Corporation
and defendant Margarito Avila for damages based on quasi-delict, arising
from a vehicular accident that occurred on March 17, 1991 in Barangay
Buensoceso, Gumaca, Quezon. The accident resulted in the death of
respondent's husband, Silvino Tan, and caused respondent physical injuries.
The accident involved a motorcycle, a passenger jeep, and a bus with Body
No. 119. The bus was owned by petitioner Philippine Hawk Corporation,
and was then being driven by Margarito Avila.
On June 18, 1992, respondent filed an Amended Complaint, in her
own behalf and in behalf of her children, in the civil case for damages
against petitioner. Respondent sought the payment of indemnity for the
death of Silvino Tan, moral and exemplary damages, funeral and interment
expenses, medical and hospitalization expenses, the cost of the motorcycle's
repair, attorney's fees, and other just and equitable reliefs.

In its Answer, petitioner denied liability for the vehicular accident,

alleging that the immediate and proximate cause of the accident was the
recklessness or lack of caution of Silvino Tan. Petitioner asserted that it
exercised the diligence of a good father of the family in the selection and
supervision of its employees, including Margarito Avila.
The trial court rendered judgment against petitioner and defendant
Margarito Avila, wherein it adjudged guilty of simple negligence. It further
held petitioner bus company liable for failing to exercise the diligence of a
good father of the family in the selection and supervision of Avila, having
failed to sufficiently inculcate in him discipline and correct behavior on the
road. The CA affirmed the decision of the trial court with modification in
the award of damages.
DY TEBAN VS. LIBERTY FOREST
G.R No. 161803
February 4, 2008

ISSUE:
Whether or not petitioner is liable to respondent for damages.
FACTS:
HELD:
YES. The Court upholds the finding of the trial court and the Court
of Appeals that petitioner is liable to respondent, since it failed to exercise
the diligence of a good father of the family in the selection and supervision
of its bus driver, Margarito Avila, for having failed to sufficiently inculcate
in him discipline and correct behavior on the road. Indeed, petitioner's tests
were concentrated on the ability to drive and physical fitness to do so. It
also did not know that Avila had been previously involved in sideswiping
incidents. The Court also affirmed the CA's decision in awarding civil
indemnity for the death of respondent's husband, temperate damages, and
moral damages for the physical injuries sustained by respondent in addition
to the damages granted by the trial court to respondent.

A Prime Mover Trailer suffered a tire blow out during the night of
its travel at a national highway. The trailer was owned by the respondent
Liberty Forest. The driver allegedly put earl warning devices but the only
evidence being witnessed was a banana trunks and candles. Since the car
was placed at the right wing of the road, thus it cause the swerving of a
Nissan van owned by the petitioner when a passenger bus was coming in
between the trailer. The Nissan van owner claimed for damages against the
respondent. The trial court found that the proximate cause of the three way
accident is the negligence and carelessness of driver of the respondent .
However reversed the decision of the trial court.
ISSUE:
Whether there was negligence on the part of the respondent.

RULING:

RULING:

Yes. There was negligence on the part of the respondent when the
latter failed to put and used an early warning device because it was found
out that there was no early warning device being prescribed by law that was
used by the driver in order to warn incoming vehicle. Furthermore, the
proximate cause of the accident was due to the position of the trailer where
it covered a cemented part of the road, thus confused and made trick way
for other vehicles to pass by. Thus the respondent is declared liable due to
violation of road rules and regulations.

Yes. The law presumes that any injury committed either by fault or
omission of an employee reflects the negligence of the employer. In quasidelicts cases, in order to overcome this presumption, the employer must
prove that there was no negligence on his part in the supervision of his
employees.

SAFEGUARD SECURITY VS. TANGCO

G.R No. 165732
December 14, 2006

It was declared that in the selection of employees and agents,

employers are required to examine them as to their qualifications,
experience and service records. Thus, due diligence on the supervision and
operation of employees includes the formulation of suitable rules and
regulations for the guidance of employees and the issuance of proper
instructions intended for the protection of the public and persons with
whom the employer has relations through his employees. Thus, in this case,
Safeguard Security committed negligence in identifying the qualifications
and ability of its agents.
VILLANUEVA VS. DOMINGO
G.R No. 144274
September 20, 2004

FACTS:
The victim Evangeline Tangco was depositor of Ecology Bank. She
was also a licensed-fire arm holder, thus during the incident, she was
entering the bank to renew her time deposit and along with her was her
firearm. Suddenly, the security guard of the bank, upon knowing that the
victim carries a firearm, the security guard shot the victim causing the
latters instant death. The heirs of the victim filed a criminal case against
security guard and an action against Safeguard Security for failure to
observe diligence of a goof father implied upon the act of its agent.
ISSUE:
Whether Safeguard Security can be held liable for the acts of its

FACTS:
In 1991, a collision was made by a green Mitsubishi lancer owned
by Ocfemia against a silver Mitsubishi lancer driven by Leandro Domingo
and owned by petitioner Priscilla Domingo. The incident caused the car of
Domingo bumped another two parked vehicles. A charged was filed against
Ocfemia and the owner Villanueva. Villanueva claimed that he must not be
held liable for the incident because he is no longer the owner of the car, that
it was already swapped to another car . however, the trial court ordered the
petitioner to pay the damages incurred by the silver Mitsubishi lancer car.

agent.
ISSUE:

Whether the owner Villanueva be held liable for the mishap.

petitioner, thus the truck owner is liable for the damage to the jeep of the
petitioner.

RULING:
ISSUE:
Under the Motor Vehicle law, it was declared that the registered
owner of any vehicle is primary land directly liable for any injury it incurs
while it is being operated. Thus, even the petitioner claimed that he was no
longer the present owner of the car, still the registry was under his name,
thus it is presumed that he still possesses the car and that the damages
caused by the car be charge against him being the registered owner. The
primary function of Motor vehicle registration is to identify the owner so
that if any accident happens, or that any damage or injury is caused by the
vehicle, responsibility therefore can be fixed on a definite individual, the
registered owner.
CALALAS VS. COURT OF APPEALS
G.R No. 122039
May 31, 2000

FACTS:
Eliza Sunga was a passenger of a jeepney owned and operated by
the petitioner Calalas. Private respondent Sunga sat in the rear protion of the
jeepney where the conductor gave Sunga an extension seat. When the jeep
stopped, Sunga gave way to a passenger going outside the jeep. However,
an Isuzu Truck driven by Verene and owned by Salva, accidentally hit
Sunga causing the latter to suffer physical injuries where the attending
physician ordered a three months of rest. Sunga filed an action for damages
against the petitioner for breach of contract of common carriage by the
petitioner.
On the other hand, the petitioner Calalas filed an action against
Salva, being the owner of the truck. The lower court ruled in favor of ther

Whether the petitionerr is liable.

RULING:
Yes. The petitioner is liable for the injury suffered by Sunga.
Under Article 1756 of the New Civil Code, it provides that common carriers
are presumed to have been at fault or to have acted negligently unless they
prove that they observed extraordinary diligence as defined in Arts. 1733
and 1755 of the Code. This provision necessarily shifts to the common
carrier the burden of proof.
In this case, the law presumes that any injury suffered by a
passenger of the jeep is deemed to be due to the negligence of the driver.
This is a case on Culpa Contractual where there was pre-existing
obligations and that the fault is incidental to the performance of the
obligation. Thus, it was clearly observed that the petitioner has negligence
in the conduct of his duty when he allowed Sunga to seat in the rear portion
of the jeep which is prone to accident.
LUDO AND LUYM CORPORATION vs. COURT OF
APPEALS
G.R. No. 125483
FEBRUARY 1, 2001
FACTS:
Ludo & Luym Corporation is a domestic corporation
engaged in copra processing. Private Respondent Gabisan Shipping Lines
was the registered owner and operator of the motor vessel MV Miguela,
while the other private respondent, Anselmo Olasiman, was its captain. On

May 21, 1990, while MV Miguela was docking at petitioners wharf, it

rammed and destroyed a fender pile cluster. Ireneo Naval, petitioners
employee, guided the vessel to its docking place. After the small rope was
thrown from the vessel and while the petitioners security guard was pulling
the big rope to be tied to the bolar, MV Miguela did not slow down. The
crew did not release the vessels anchor. Naval shouted Reverse to the
vessels crew, but it was too late when the latter responded, for the vessel
already rammed the pile cluster. Petitioner demanded for damages but
private respondents denied the incident and the damage. Their witnesses
claimed that the damage, if any, must have occurred prior to their arrival
and caused by another vessel or by ordinary wear and tear.
ISSUE:
Is the doctrine of res ipsa loquitur applicable to this case?

engine is restarted. From these declarations, the conclusion is that it was

already too late when the captain ordered reverse. By then, the vessel was
only 4 meters from the pier, and thus rammed it.
Respondent companys negligence consists in allowing incompetent
crew to man its vessel. As shown also by petitioner, both Captain Olasiman
and Chief Mate Gabisan did not have a formal training in marine
navigation. The former was a mere elementary graduate while the latter is a
high school graduate. Their experience in navigationwas only as a
watchman and a quartermaster, respectively. Gabisan Shipping Lines and
the ship captain are held jointly and severally liable for damages caused to
the petitioner.
THERMOCHEM INCORPORATED vs. LEONORA NAVAL
G.R. No. 131541
OCTOBER 20, 2000

RULING:
FACTS:
The doctrine of res ipsa loquitor provides that where the thing which
causes injury is shown to be under the management of the defendant, and
the accident is such as in the ordinary course of things does not happen if
those who have the management use proper care, it affords reasonable
evidence, in the absence of an explanation by the defendant, that the
accident arose from want of care. In this case, all the requisites for this
doctrine exist. First, MV Miguela was under the exclusive control of its
officers and crew. Second, aside from the testimony that MV Miguela
rammed the cluster pile, private respondent did not show persuasively other
possible causes of the damage. There exists a presumption of negligence
against private respondents which they failed to overcome. Additionally,
petitioner presented proof that demonstrated private respondents
negligence. As testified by Capt. Olasiman, from command of slow ahead
to stop engine, the vessel will still travel 100 meters before it finally
stops. However, he ordered stop engine when the vessel was only 50
meters from the pier. Further, he testified that before the vessel is put to
slow astern, the engine has to be restarted. However, Olasiman can not
estimate how long it takes before the engine goes to slow astern after the

"On May 10, 1992, at around 12:00 o'clock midnight, Eduardo

Edem was driving a "Luring Taxi" along Ortigas Avenue, near Rosario,
Pasig, going towards Cainta. Thereafter, the driver executed a U-turn to
traverse the same road, going to the direction of EDSA. At this point, the
Nissan Pathfinder traveling along the same road going to the direction of
Cainta collided with the taxicab. The point of impact was so great that the
taxicab was hit in the middle portion and was pushed sideward, causing the
driver to lose control of the vehicle. The taxicab was then dragged into the
nearby Question Tailoring Shop, thus, causing damage to the said tailoring
shop, and its driver, Eduardo Eden, sustained injuries as a result of the
incident."
Private respondent, as owner of the taxi, filed a damage suit against
petitioner, Thermochem Incorporated, as the owner of the Nissan
Pathfinder, and its driver, petitioner Jerome Castro. After trial, the lower
court adjudged petitioner Castro negligent and ordered petitioners, jointly

and severally, to pay private respondent actual, compensatory and

exemplary damages plus attorney's fees and costs of suit.
ISSUE:
What are the liabilities of both parties?
RULING:
The driver of the oncoming Nissan Pathfinder vehicle was liable and
the driver of the U-turning taxicab was contributorily liable. It is
established that Castro was driving at a speed faster than 50 kilometers per
hour because it was a downhill slope. But as he allegedly stepped on the
brake, it locked causing his Nissan Pathfinder to skid to the left and
consequently hit the taxicab. Malfunction or loss of brake is not a fortuitous
event. Between the owner and his driver, on the one hand, and third parties
such as commuters, drivers and pedestrians, on the other, the former is
presumed to know about the conditions of his vehicle and is duty bound to
take care thereof with the diligence of a good father of the family. A
mechanically defective vehicle should avoid the streets. As petitioner's
vehicle was moving downhill, the driver should have slowed down since a
downhill drive would naturally cause the vehicle to accelerate. Moreover,
the record shows that the Nissan Pathfinder was on the wrong lane when the
collision occurred.
The taxi driver is contributorily liable since he took a U-turn where
it is not generally advisable. The taxi was hit on its side which means that it
had not yet fully made a turn to the other lane. The driver of the taxi ought
to have known that vehicles coming from the Rosario bridge are on a
downhill slope. Obviously, there was lack of foresight on his part, making
him contributorily liable. Considering the contributory negligence of the
driver of private respondent's taxi, the award of P47,850.00, for the repair of
the taxi, should be reduced in half. All other awards for damages are deleted
for lack of merit.
AMADO PICART vs. FRANK SMITH, JR.
G.R. No. L-12219

MARCH 15, 1918

FACTS:
The plaintiff, riding on his pony was half way across the Carlatan
bridge when the defendant approached from the opposite direction in an
automobile, going at the rate of about ten or twelve miles per hour. As the
defendant neared the bridge he saw a horseman on it and blew his horn to
give warning of his approach. He continued his course and after he had
taken the bridge he gave two more successive blasts, as it appeared to him
that the man on horseback before him was not observing the rule of the
road. The plaintiff saw the automobile coming and heard the warning
signals. However, thinking that he has no sufficient time to go to the other
side of the road, he pulled the pony closely up against the railing on the
right side of the bridge instead of going to the left. The defendant, instead of
veering to the right while yet some distance away or slowing down,
continued to approach directly toward the horse. When he had gotten quite
near, there being then no possibility of the horse getting across to the other
side, the defendant quickly turned his car sufficiently to the right to escape
hitting the horse alongside of the railing where it as then standing; but in so
doing the automobile passed in such close proximity to the animal that it
became frightened and turned its body across the bridge with its head
toward the railing. In so doing, it as struck on the hock of the left hind leg
by the flange of the car and the limb was broken. The horse fell and its rider
was thrown off with some violence. As a result of its injuries the horse died.
The plaintiff received contusions which caused temporary unconsciousness
and required medical attention for several days.
ISSUE:
Whether or not the defendant is guilty of negligence.
RULING:
As the defendant started across the bridge, he had the right to
assume that the horse and the rider would pass over to the proper side; but
as he moved toward the center of the bridge he clearly saw that this would

not be done; and he must in a moment have perceived that it was too late for
the horse to cross with safety in front of the moving vehicle. The control of
the situation had then passed entirely to the defendant; and it was his duty
either to bring his car to an immediate stop or, seeing that there were no
other persons on the bridge, to take the other side and pass sufficiently far
away from the horse to avoid the danger of collision. Instead of doing this,
the defendant ran straight on until he was almost upon the horse.
The plaintiff himself was not free from fault, for he was guilty of
antecedent negligence in planting himself on the wrong side of the road. But
it was the defendant who had the last clear chance to avoid the impending

harm and when he failed to do so, he is deemed negligent, thus liable to pay
damages in favor of the plaintiff.