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RCBC vs CA Chaves vs Gonzales

G.R. No 133107, March 25, 1999 G.R. No. L-27454, April 30, 1970

Facts: Petitioner and private respondent stipulated a contract of sale, where Facts: Petitioner commissioned respondent for the cleaning and repairing of his
payment of latter consisted of an initial lump sum and monthly installments, which typewriter. However, after repeated requests of the former for the latter’s speedy
he already made in post-dated checks. They also executed a contract of chattel service, the typewriter was ultimately left unrepaired. Petitioner eventually asked
mortgage (the car itself) stating that in the event of private respondent’s default, for the return of his typewriter. Alas, it was returned in shambles and some of its
he is bound to pay the entire remaining balance, along with the interests of the parts missing. He commissioned another for its repair. He then asked through the
balance. Unfortunately, one of the checks were left unsigned, thus money debited Court, payment for damages (isolated on the relevant ones only) for the non-
from private respondent was returned in his account. Later thereafter, petitioner repair, and the payment petitioner made to another repairman.
declared him in default
Remedies: Court of First of Instance (actually won by PETITIONER but unsatisfied
Remedies: Regional Trial Court (won by PRIVATE RESPONDENT) with the rule.
Court of Appeals (won by PRIVATE RESPONDENT)
Issue: Given these set of facts, the question posed now is whether or not
Issue: Given of the facts, the questions posed is whether or not the unsigned check defendant is liable for these damages petitioner is allegedly entitled to
causes respondent to be in default, and (underlying issue?) whether or not the
chattel mortgage should be enforced. Rule: Art. 1167 of the Civil Code provides that if a person obliged to do something
is fails to do it, the same shall be executed at his cost. Also, Art. 1170 provides that
Rule: Art. 1159 of the Civil Code provides contractual obligations must be complied those who in the performance of their obligation are guilty of contravening the
with good faith. Also, Art. 1370 provides that if the terms of a contract are clear tenor of such, are liable for damages.
and leave no doubt of intention of the contracting parties, the literal meaning shall
control. Application: In this case, even from his own admission, respondent failed to repair
the typewriter. By virtue of Art. 1167, he is liable for the cost petitioner incurred
Application: In this case, petitioner could have simply communicated such error to when he commissioned another person for its repair. As to his return to petitioner
private respondent and asked for the signature. Instead, the former chose to of an already-cannibalized, unrepaired, and incomplete typewriter, he
inform him late that he “defaulted” from his payments, clearly an absence of good contravened the tenor of his obligation, for he was obliged to return it to the same
faith (Art. 1159). Also, it is clearly indicated that the chattel mortgage should only condition it was when he received it (Art. 1170).
be enforced in the event that private respondent fails to pay for any of the
installments (Art. 1370). He however did not fail to pay, given of the existence of Conclusion: From the foregoing, it is likely that defendant will be liable for the
sufficient funds, only the absence of required signature. damages petitioner, as he claimed, are entitled to.

Conclusion: From the foregoing, it is likely the Court may declare him not in Note: Moral and temperate damages, and attorney fees was not affirmed as they
default, and the mortgage will not be enforced. were not alleged in the complaint.
Tanguilig vs CA Enriquez vs Ramos
G.R. No. 117190, January 2, 1997 G.R. No. L-23616, September 30, 1976

Facts: Petitioner proposed to private respondent to construct windmill for him Facts: Plaintiffs averred they sold to defendant lots, of which P200,000 the
with a guaranty. They eventually agreed upon such, with respondent paying for a remaining balance with interests. They also executed a mortgage (if not
downpayment and an installment payment, with a certain balance. Later on, registered, obligation is due and demandable; mortgagor to shoulder taxes) of
respondent refused to pay the balance, because he already paid another to various lands in favor of plaintiff should defendant fail to pay. Currently, plaintiffs
construct a deep well, which petitioner failed to build. Furthermore, petitioner argued that defendant violated such agreement/s (?): (1) refused to pay on
states that non-payment may also because of destruction of the windmill, which stipulated period, (2) a property was not registered for mortgage, and (3) taxes
he claims a cause of fortuitous event. were not paid. Defendants replied: (1) by res judicata, she has not paid the taxes
and registered the mortgage as it was only a minor matter, (2) the paving of the
Remedies: Regional Trial Court (won by PETITIONER) roads, which attracted defendant on the sold lots, were still incomplete, and (3)
Court of Appeals (won by RESPONDENT) no demands of payment were made upon completion. No contention however
that she has not paid the balance.
Issue: Given these set of facts, the questions posed is whether or not such
construction of the windmill included the installation of deep well (underlying Remedy: Court of First Instance (won by DEFENDANT)
issue: which may institute respondent to commission it to another – if it was
allowed.) and whether petitioner is under obligation the reconstruction. Issue: From the foregoing facts, the question posed is whether or not respondent
has defaulted from her payments.
Rule: Art. 1371 of the Civil Code provides that the parties’ contemporaneous and
subsequent acts shall be the consideration to judge intention of contracting Rule: Art. 1187 of the Civil Code provides that effects of a conditional obligation to
parties. Next, Art. 1240 provides that payment shall be made to the person whose give, once condition is fulfilled, shall retroact to the day of the constitution of the
favor the obligation has been constituted or any person authorized to receive it. obligation.
Then, Art. 1174 provides that no person shall be responsible for events which could
not be foreseen or inevitable. Finally, Nakpil v CA provides for the precepts to who Application: In this case, the paving of the roads was the prime consideration of
may avail defense of a “fortuitous event.” defendant of buying the lots, which she will turn to a subdivision. Any aversion by
defendant (e.g. no trees and water system, acceptance of City Planning) definitely
Application: In this case, the words “suitable for” and “for” in the proposal were are not within those contemplated. With such obligation resolved, defendant
meant to convey the idea it appropriateness for a deep well. Also acts before and cannot argue that proper demands were not made as effect of such demand
after the contract does not uphold respondent’s defense (Art. 1371). retroacts of the constitution of obligation (Art. 1187)
Consequently, Art. 1240 cannot be raised for two reasons: (1) obligation did not
include construction of the deep well, (2) no substantial proof that he was Conclusion: From the foregoing, it seems that the Court may favor the plaintiff-
authorize to receive such payment in lieu of petitioner. appellee for his cause.
Onto the second issue, Art. 1174 cannot be invoked because it
was proven that it was not a typhoon that wrecked the windmill but a strong wind,
which does not constitute a fortuitous event. Notes: Art. 1169 provides that demand by creditor shall not be necessary when the
law expressly so declare (may refer to Art. 1187 thereafter)
Conclusion: From the foregoing, it is likely that the Court will award petitioner of
the balance. However, he is liable for the reconstruction of the windmill
DBP vs Mirang Repide vs Afzelius
G.R. No. L-29130, August 8, 1975 G.R. No. L-13438, November 20, 1918

Facts: Petitioner granted defendant (now the appealing party) a loan for the Facts: Plaintiff agreed to sell his land to defendant, on a terms of payment of lump
latter’s farming needs, with his homestead as the guaranty. Unfortunately, a sum and the remaining balance to be paid in monthly installments. The land itself
mosaic disease affected defendant’s plantation, and has eventually failed to pay was to be mortgaged for security. Unfortunately, defendant withdrew his interest
for the annual amortizations of his loan. His property then was sold for public of the purchase. for reasons of equity or lack of money. He furthers that obligation
auction, with which plaintiff itself the winning bidder. Defendant then aver that is extinguished. Plaintiff however demand the execution of the agreement.
the mortgage absolves him from indebtedness. If not, he prays for reduction by
reason of the attack of the mosaic disease upon the plants. Remedy: Court of First Instance (won by DEFENDANT)

Remedy: Court of First Instance (won by Plaintiff-appellee) Issue: From the given facts, the question posed is whether or not plaintiff may
demand the performance of creditor of their agreement.
Issue: Given of the facts, the question posed is whether or not the sale of
defendant’s property absolves him of his indebtedness. Also whether he can’t be Rule: According to Art. 1451 of the Spanish Civil Code, a promise to sell or buy,
absolved, be at least granted reduction to such indebtedness when there is an agreement as to the thing and the price, entitles the contracting
parties reciprocally to demand the fulfillment of the contract.
Rule: In Philippine Bank of Commerce vs de Vera, it is provided that a real estate
mortgage does not limit or minimize the amount of the obligation. Furthermore, Application: In this case, they already had a prior agreement for plaintiff to sell the
if after the sale, there is deficiency, the mortgagee may proceed for a proper land, and for defendant to buy it. Reasons of equitable doctrine cannot be held if
action. there exists a law demanding such and does not absolve him of obligation.

Application: In this case, sale of defendant’s homestead in public auction, upon Conclusion: From the foregoing, it is likely that plaintiff in this case may have a
collection of proceeds thereafter, does not absolve him of his total debt. Also, the favorable judgment against the defendant.
misfortune defendant faced does not justify disregard of the terms of the contract
he entered into. Note: Art. 1124 provides right of prejudiced person exacting performance of
obligation or indemnity for damages and payment of interest.
Conclusion: From the foregoing, it is likely that defendant would be required for
the payment of the deficiency and cannot be necessarily entitled to reduction of
such indebtedness.
Dioquino vs Laureano Republic vs Luzon Stevedoring Corp.
G.R. No. L-25906, May 28, 1970 G.R. No. L-21749, September 29, 1967

Facts: Plaintiff and defendant drove together to the office of the latter to register Facts: Defendant (now appellee) had his barge towed by his two tugboats,
former’s vehicle. While on the way, some mischievous kids stoned said vehicle, presumably to guide such barge through the Pasig River. Unfortunately, the barge
breaking the windshield. The defendant, who effectively borrowed the car, rammed against one of the wooden piles of the Nagtahan Bailey Bridge to
refused to hold the children liable for shattering the windshield as it was due to a collapse. Plaintiff, representing the residents of the area, filed for damages.
fortuitous event. Plaintiff then filed this action against defendant. Defendant however averred that knowing the presence of an unfavorable, heavy
downpour, exercised due diligence on their action, though ultimately resulted to
Remedy: Court of First Instance (won by PLAINTIFF v principal defendant) such accident. Thus, they deemed that a fortuitous event occurred, relieving them
of any liability.
Issue: Given of the facts, the question posed is whether or not the defendant, the
borrower of the car, is absolved of liability and (underlying issue) the stoning of Remedy: Court of First Instance (won by PLAINTIFF)
children may be considered fortuitous.
Issue: Given these facts, the question posed is whether or not the defendant
Rule: Art. 1174 of the Civil Code provides no person shall be responsible for those should be held liable (underlying issue) considering that they may have exercised
events which could not be, foreseen, or which, though foreseen were inevitable. due diligence and the unfavorable weather conditions should be blamed for the
Application: In this case, defendant clearly did not foresee children would perform
such mischief upon plaintiff’s vehicle. It definitely constitutes a fortuitous event Rule: Art. 1174 of the Civil Code effectively defines what fortuitous events are:
(Art. 1174). Also mere difficulty to foresee is not impossibility to foresee the same. events that could not be foreseen, or which though foreseen, were inevitable.

Conclusion: From the foregoing, it seems that defendant may be relieved from Application: In this case, herein case is negated by the definition of what fortuitous
paying any indemnity to plaintiff as such circumstance was fortuitous in nature. events are by their acknowledgment that they there was an unfavorable condition
that may pose peril, yet they pushed through of their action (Art. 1174). They
cannot blame the improper placement of the bridge as they have been crossing
this bridge for years.

Conclusion: From the foregoing, it seems that defendant would be held liable by
the Court for negligence for assuming such risk, but ultimately botched on the
execution of their act.
Victorias Planters Association vs Victorias Milling Co. In Re: Estate of Ceballos
G.R. No. L-6648, July 25, 1955 G.R. No. L-4190, December 17, 1908

Facts: Petitioners and respondent executed milling contracts that obliges the the Facts: Namesake Ceballos died, effectively causing the dissolution of his business
latter to construct a sugar central and the former to deliver produced sugar to be partnership with a certain Sanchez. After the heirs were assigned and awarded of
milled. The period of their contracts stipulated was to last for 30 years. However, their respective properties, a mortgaged property (presumably in the course of
war ravaged the country (well within the latter half of the contracts’ period), the business partnership) was foreclosed in favor of Don Ortiz. The wife, Doña
rendering the planters unable to deliver stipulated sugar cane during the final four Matilde, of namesake Ceballos claims, as the wife of the deceased, she still has an
years of the war, and two years for the reconstruction of the sugar central. interest on the mortgaged property. Ortiz avers that all interests she might have
Petitioners contend that the war must be considered a fortuitous event and must had are deemed withdrawn upon execution of sale.
not be held against them. Respondent contends that they contracted for 30
milling years and not 30 calendar years. Thus, petitioners are still liable for another Remedy: Court of First Instance (won by by WIDOW CEBALLOS)
6 years of delivering sugar.
Issue: Given of the facts, the question posed is whether or not the sale of property
Remedy: Court of First Instance (won by PETITIONERS-APPELLEE) effectively strips the wife of claim to redeem such mortgaged property.

Issue: Given these facts, the question posed is whether or not the stipulated Rule: Art. 1111 of the Spanish Civil Code provides that creditors may enforce all the
period is to be construed as 30 milling years and not 30 calendar years (underlying rights and actions of the debtor for collecting what is due to the former. However,
issue) considering war, allegedly a fortuitous event, ravaged the country which those inherent in the latter, cannot be enforced. Dela Rosa v Santos further
rendered the inactivity in the sugar central for six years. provides that an owner is entitled to remain in the possession of the land until
proper redemption is made.
Rule: Art. 1174 of the Civil Code provides that a fortuitous event relieves the obligor
from fulfilling a contractual obligation. Application: In this case, right of redemption are personal in nature, and therefore
Doña Matilde’s conjugal and usufructuary rights cannot be claimed by Don Ortiz.
Application: In this case, the six years of non-activity cannot be deducted from the
30-year period agreed upon by the parties. Furthermore, the war was a fortuitous Conclusion: From the foregoing, it seems that the Court will rule that Doña Matilde
event that made the inability of the planters to produce sugar needed to be retains her personal rights, and therefore may claim redemption on the foreclosed
delivered (Art. 1174). land.

Conclusion: From the foregoing, it is likely that the Court will not hold such non- Note: Art. 1111 shares a similar definition of Art. 1177 which provides
delivery of the sugar to be milled, and the contract may be extinguished. “creditors…may exercise all the rights and bring all the actions of the latter for
the same purpose, save those which are inherent in his person...”
Note: Nemo tenetur ad impossibilia – an obligation cannot be demanded when
performance is impossible. The performance of what the law has written of
cannot be demanded and required
Bastida and Ysmael & Co. vs Dy Buncio
G.R. No. L-5145, May 27, 1953

Facts: Co-plaintiffs are respectively industrial and capitalist partners of each other.
Bastida was authorized by defendant to broker for his partner for the purchase of
defendant’s factory for co-petitioners. Though Ysmael did not agree on the sale,
he did express interest but eventually settled on leasing the factory. Along with
the agreement of lease (for two years), defendant also gave an OPTION to buy the
factory within the agreed period at a discount. The OPTION was placed in Bastida’s
name (there was a commission if the transaction was named to him), eventually
however, it was transferred to Ysmael on defendant’s consent. Complications
arose; and ultimately, defendant refused to honor the OPTION he granted
because (1) by virtue of the Constitution, aliens – Bastida being a Spanish citizen –
cannot acquire real property and (2) he only reserved such right to Bastida alone,
and such OPTION cannot be exercise nor exercised by Ysmael.

Remedy: Court of First Instance (won by PLAINTIFF)

Issue: Given these facts, the questions posed are whether or not the OPTION is
still valid (underlying issue) and consequently, if such was valid whether the
transfer to Ysmael is standing.

Rule: Art. 1397 of the Civil Code provides that one who has capacity to contract
may not invoke incapacity of the party whom they contracted to. Also, Art. 1178 of
the Civil Code provides that all rights acquired in virtue of an obligation are
transmissible if there is no stipulation to the contrary.

Application: In this case, defendant well knew that Bastida had no financial means.
However, he assigned the OPTION to him to accommodate his request for such
transaction would warrant him a commission for brokering. Effectively however,
it was still between defendant and Ysmael. He therefore cannot allege Bastida’s
incapacity from being an alien (Art.1397) Lastly, there was no impediment, legal or
contractual, to transfer his right of OPTION to Ysmael, thus; such right arising from
contract is transmissible.

Conclusion: From the foregoing, it is likely that the Court will dismiss defendant’s
complaint and favor the plaintiffs.

Note: OPTION has a legal implication.