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Author: Earvin James M.

x x x Since appellants admit that appellees are not
NATIONAL DEVELOPMENT COMPANY, ET AL. (1960) under legal obligation to give such claimed bonus;
Plaintiffs/Appellants: Primitivo Ansay, et al. that the grant arises only from a moral obligation or
Defendants/Appellees: The Board of Directors of National the natural obligation that they discussed in their brief,
Development Company, et al. this Court feels it urgent to reproduce at this point, the
Ponente: Paras, C.J. definition and meaning of natural obligation.

DOCTRINE: Natural Obligations; Element of Voluntary Fulfillment; When Article 1423 of the New Civil Code classifies
Retention Can Be Ordered. obligations into civil or natural. "Civil obligations are a
An element of natural obligation before it can be cognizable by the court is right of action to compel their performance. Natural
voluntary fulfillment by the obligor. Retention can be ordered only after there obligations, not being based on positive law but on
has been voluntary performance. equity and natural law, do not grant a right of action
to enforce their performance, but after voluntary
Bonus Not Demandable and Enforceable, Exceptions. fulfillment by the obligor, they authorize the retention
A bonus is not a demandable and enforceable obligation, except when it is of what has been delivered or rendered by reason
made a part of the wage or salary compensation. (Philippine Education Co. v. thereof".
CIR and the Union of Philippine Education Co. Employees (NLU), 92 Phil.,
381; 48 Off. Gaz. 5278.) Hence, the grant thereof does not generally constitute It is thus readily seen that an element of natural
a natural obligation on the part of the company. obligation before it can be cognizable by the court is
voluntary fulfillment by the obligor. Certainly retention
FACTS: can be ordered but only after there has been
voluntary performance. But here there has been no
1. Plaintiff – appellants filed a case against defendant – appellees for the voluntary performance. In fact, the court cannot order
award of 20% Christmas Bonus for the years 1954 & 1955 which the the performance.
trial court dismissed for lack of cause of action, the same being a mere
act of liberality on the part of the employer, and that although the same At this point, we would like to reiterate what we said
is a moral obligation of defendant – appellees, the court cannot in the case of Philippine Education Co. vs. CIR and
effectively enforce the same. Hence, the instant appeal on the the Union of Philippine Education Co., Employees
argument that the same being a moral obligation may be made (NUL) (92 Phil., 381; 48 Off. Gaz., 5278) —
enforceable through the courts.
xxx xxx xxx
From the legal point of view a bonus is not a
WON the defendant – appellees are obliged to deliver to the plaintiff – demandable and enforceable obligation. It is
appellants their 20% Christmas bonus. so when it is made a part of the wage or
salary compensation.
And while it is true that the subsequent case of H. E.
RULING + RATIO: Heacock vs. National Labor Union, et al., 95 Phil.,
No. The defendant – appellees are not obliged to deliver the same to the 553; 50 Off. Gaz., 4253, we stated that:
plaintiff – appellants.
 The Court ruled that the provision for a 20% Christmas bonus was a Even if a bonus is not demandable for not
mere moral obligation on the part of defendant – appellees and forming part of the wage, salary or
therefore depends upon the voluntary fulfillment by the obligor which compensation of an employee, the same may
the court may not compel. Thus:
Author: Earvin James M. Atienza
nevertheless, be granted on equitable
consideration as when it was given in the
past, though withheld in succeeding two
years from low salaried employees due to
salary increases.

still the facts in said Heacock case are not the same
as in the instant one, and hence the ruling applied in
said case cannot be considered in the present action.

(emphasis supplied)