REINSURANCE
It will form part of
When we say reinsurance, it is an
insurance taken out by an insurer against
liability. Tandaan nyo, insurance is
against loss, damage or liability. One
good example is reinsurance. Sabi ko
dati, insurance is risk distributing. One
way that I explained redistributing is in
the case of the insurer when it enters into
a contract of reinsurance agreeing to
indemnify the insured in case of loss or
damage up to a certain amount. Kung
ako ang insurer, I may not want to bear
the liability alone. Gusto ko may kahati
ako so what the insurer does in to go to
another insurer and that another insurer
is called reinsurer. The contract is called
reinsurance, which is an insurance
against liability.
Ako for example yung insurer. I insured
your life for 10 million pesos. By reason
of our policy, in case the insured dies, I
have to pay the beneficiary 10 million
pesos. Kaya lang, I don’t want to bear
the risk alone. What I do as an insurer is
to go to a reinsurer. Sasabihin ko sa
kanya, meron akong pinainsure for 10
million, papa-insure naman ako sayo ng
4 million. Madisgrasya man ang aking
insured, in the end, I don’t suffer 10
million but only 6 million. Ang mga
reinsurer, konti lang yan. Reason ay
competition sa mga foreign insurance
companies. This is because domestic
insurance companies has limited capital.
Nung nagkaroong ng liberalization,
pumasok ang Pru UK, etc.
The contract of reinsurance is between
the insurer and the reinsurer. Going back
to my example earlier. I insured your life
for 10 million then I reinsured with
reinsurer for 4 million. Ngayon, yung
insured namatay. In short, I have to pay
the beneficiary for 10 million. Kaya lang
nabankcrupt pero may receivable ka. Pag
natanggap ko yun, hindi yun earmarked
para sa beneficiary.
the mass of my assets. Creditors will be
paid following the order of preference
under the Civil Code
OVERINSURANCE
When is there an overinsurance? There
is overinsurance where a person insures
his property for more than the value of
his insurable interest. Yung
overinsurance, sa property insurance
lang yan. Wala sa life for the simple
reason than human life is incapable of
pecuniary estimation. Kaya lang sa
practice, you cannot insure your life for
just any amount.
What is the effect of overinsurance?
Overinsurance is VOID. Ex: Insurable
interest mo ay 1 million pesos. Ang
ginawa mo e you talked to another
insurer for 500, 000. Yung 500, 000 na
yun, overinsurance nay un kasi naka-
insure ka na for 1 million and it exceeds
your insurable interest. Yung 500, 000
yun yung overinsurance, yun yung void.
To the extent of 1 million, hindi yon
overinsurance.
Usually, overinsurance takes place when
a persons insures with more than one
insurer. And when a person insures with
more than one insurer for the same
object, same interest, ang tawag doon ay
DOUBLE INSURANCE.
DOUBLE INSURANCE
There is double insurance when a person
insures the same object, interest against
the same risk with more than one
insurer. Ang tanong, can you insure with
more than one insurer? Pwede.
Sasabihan ka, don’t put all your eggs in
one basket. Kaya kunyari meron ka
property worth 10 million pesos, ang
ginawa mo, you insured that property
against fire. First, with BPI MS. Second,
with Malayan Insurance. Third, with
Stronghall. 5million, 3 million and 2
million respectively. Meron ba
overinsurance? Wala kasi pag pinagsama
sama mo yan ang total ay 10 million
lang naman. Now, is there a double
insurance? Baka naman sabihin nyo, sir
wala. Triple insurance LOL. Double
insurance yan. Basta humigit sa isa
insurer, double insurance na yan.
Kung meron double insurance, meron
din ba under insurance? Meron.
There is underinsurance when a person
insures property for an amount less than
the value of his insurable interest.
Ano effect ng underinsurance? For
example you have a property worth
10M, you insured it only for 6M. So you
are underinsured by 4M. Ngayon,
insured ka for 6M but your are not
insured for 4M. Mangyayari nyan, pag
nagkaroon ng kahit anong loss, you
won’t be able to recover the full value.
When a person underinsures, in effect,
he becomes a CO-INSURER of the
property. Pag hindi ka nagpa-insured,
ang tawag sa iyo ay SELF-INSURED
kasi pag nagkaroon ng loss, ikaw
magrerepair ng loss. Pag naka-insure ka
naman, the insurer pays the indemnity.
Kaya lang, pag nagpa-insure ka for an
amount less than the value of your
insurable interest, naka-insure ka up to a
certain amount but for the difference
between the value of your insurable
interest, you would have to be self-
insured.
Kapag ikaw ay self insurer, para din
yang meron double insurance. For
example, nagpa-insure ka sa tatlong
insurance, yung tatlong insurance na
iyon are called co-insurers. Meron co-
insurance. Kaya pag tinanong kayo,
when will there be co-incurance? In case
of: 1) double insurance; and 2) under
insurance.
Walang problema kung total loss tapos
underinsured ka like when the value of
your property is worth 10M but you only
insured for 6M. Pag may total loss,
walang problema, the insurer pays you
6M. E pano kung ang loss mo ay 1M
lang? Then the insurer will only pay a
part of it. Magkakaroon ng pro-rating.
Illustration:
Value of property = 10 million
Insurer A insured for 5 million = share
sa loss ay 1 million.
Insurer B insured for 3 million = share sa
loss ay 600K.
Insurer C insured for 2 million = share sa
loss ay 400k.
Pag nagkaroon ng partial loss, for
example 2M, sinong magbabayad ng
2M? Sasabihin mo ba si C kasi sakto
yung kay C na 2M? Hindi. You pro-rate
parang sa wills and succession
Ganoon din pag under insured.
Ano yung micro-insurance? Yang micro-
insurance, life insurance yan. Di yan
pwede sa property. Kaya lang totoo, di
naman talaga micro. Para kasi
maconsider as micro-insurance, dapat
kung ano yung minimum wage sa NCR
x 1000 yung yung microinsurance. Kasi
pag 500K and annual premium nun,
magstart na sa 10, 000. Mabigat bigat
din yun.
Basta tandaan, micro-insurance is life
insurance.
Nowadays, when you insure a property,
you can insure based on acquisition cost
or replacement cost. Yung bahay na
pinagawa mo 50 years ago, ang ginastos
mo 100k lang. Ngayon, you were able to
maintain it very well. Kung papagawa ka
ng parehong bahay ngayon, aabutin ka
halimbawa ng 5M, pwede ka pa-insure
for 5M. Because nowadays, insurer are
willing to insure based on replacement
cost.
Now, on a practical note, sasabihin mo
dapat sa insurer minus the cost of the
foundation. Kung papatayo ka ng bahay,
diba may foundation yan? Halibawa,
yung bahay mo is worth 10M then yung
ginastos mo sa foundation is worth 1M,
sabihin mo sa insurer you are insuring
the entire structure excluding the
foundation. Kasi, magkaroon man ng
total loss yan, hindi masusunog
foundation.
INTELLECTUAL PROPETY LAW
The title of the law is Intellectual
Property Code. The reason is it is
actually a compilation of related laws.
Yung IP Code became law during the
time of President Ramos. Nung panahon
namen nung nag-aral kami ng law,
meron law on patent and another law on
copy right. Hiwa hiwalay so they were
administered by different government
offices. When the IP Code became
effective, pinagsama saman na. Only one
office became in charge and that is the
Intellectual Property Office.
The head of the office is a Director
General. In this room ako lang pwede,
kasi unang requirement is at least 40
years old. Pangalawa, dapat lawyer.
Kaya both qualification meron na ako.
What are the different intellectual
properties?
1. Patent
2. Copyright (right to copy)
3. Industrial Designs
4. Lay out or Topography of
integrated circuits.
5. Geographic indication.
6. Protection of undisclosed
information
7. (TRIPS) Trade Related Aspect of
IP Rights
8. Trade names and trademarks.
PATENT
For what is a patent issued?
A patent is issued for an INVENTION.
But not every invention are patentable.
Example: You are a husband na
dumadating hating gabi tapos lagi ka
hinihintay ng asawa mo. In short, every
time that your wife asks you why you
are very late, you come up with a very
nice explanation then sasabihin sayo ng
wife mo, ang husay mo talaga mag-
imbento. Hindi yun patentable. Kung
sakali copyright (LOL).
So ano characteristics ng patentable
invention?
1. It must be new.
When is an invention is new? It
is new when it is not part of a
prior art. Kaya kung sinasabi mo
yung naimbento mo gusto mo
ipapatent e meron na pala nyan,
hindi na yan new kasi meron na
prior art.
 Suppose I would tell you,
nakaimbento ako ng microphone,
e meron na microphone. Luma na
yan. Sasabihin ko aba hinde. Ang
mircrophone na alam nyo yung
nakalagay sa wall socket. Yung
sa akin wala. Yung saken init
lang ng kamay. Yung init ng
kamay na yun is enough to power
the microphone. Meron na bang
ganun na microphone? Wala.
Then I can have a patent over
that. Kasi it is new.
2. It must involve an inventive step.
Something merely discovered is
not patentable except
microorganisms and what good
they could do. To illustrate the
point, madami kang pimples.
One daw, when you were on your
way to your dermatologist, bigla
bumuhos ulan. Nadulas ka sa
lupa yung mukha mo sa tae ng
kabayo. Pagg-uwi mo, wala na
mga pimple. Pwede mo ba i
patent yun kahit walang
inventive step? (YES?)
Another example is yakult which
has probiotics, meron patent.
Kaya kung wala kayo magawa,
hanap lang kayo mikrobyo.
3. Capable of industrial
application.
You have an invention, since it
will be mass produced so there
must be existing raw materials or
new raw materials which will
help you mass produce.
An invention may meet this three
qualification but then there are
inventions that are not patentable.
These are inventions that are
contrary to law or morals.
Halimbawa nakaimbento ka ng
substitute for shabu tapos
gagamit ka ng prohibited
ingredient. Then that is contrary
to law kasi meron prohibited
ingredient.
Ngayon pag sinabing contrary to
morals, we talk about sex.
There are a lot of lonely women
whose husband are abroad, etc.
and they miss their husbands. I
learned that many of them had
resorted to gadgets. Yung
vibrator. Kunyari nakagawa ako
ng same gadget that moves
forward and backwards, different
skills, pwede ko ba papatent? No,
contrary to morals.
Also not patentable are surgical
procedures. For example, diba pag
inopera tinatahi. Instead na tahini, stapler
na lang. Kasi hindi naman lahat ng
doctor marunong tumahi. Yung
procedure na gumagamit ng surgical
stapler, patentable ba yun? Hindi. Ang
patentable ay yung mismong gadget
mismo na ginagamit
Another example. Diba meron procedure
called endoscopy pero that is painful.
May papasok sa loob mo para makita
kaloob looban mo. Kung meron kang
technology na pill, tapos lulunukin mo.
As that pill moves inside your body, it
takes pictures. Yun procedure nay un,
hindi patentable kundi yung gadget na
yun. Kaso yung pill na yun, single use
lang kasi alam mo naman san lalabas
yun (LOL).
Also not patentable are mathematical
formulas. Natatandaan nyo physics nyo,
naipapatent ba ni Einstein yun? Hindi.
Natatandaan nyo geometry nyo diba
andaming theorem. Never napatent yan.
Yung density, velocity, etc. may mga
formula yan pero not patentable.
Also not patentable are mere concepts or
ideas. Pinag-iisipan mo pa lang pero
wala ka pa nagagawa talaga. Yung naisip
mo, you cannot have a patent over it.
For how long is a patent valid? 20 years.
Kaya lang, yung 20 years nay an,
counted from the date of filing.
Remember, you don’t get your patent
upon filing. Kasi, yung claim mo to be
patented, kailangan paverify yan. For
example, medicine, it requires lot of
clinical tests. Kaya yang gamot, di yan
agad nabibigyan ng patent.
There was an American who invented a
multispeed windshield wiper. Dati mga
sasakyan, dalawa lang speed. Normal
atsaka fast. Nowadays, when you buy
brand new cars, meron na intermittent.
Pag konti pa patak ng ulan, matagal pa
balik. So ngayon, meron na apat na
speed. Yung naka-imbento ng
multispeed windshield wiper, he got his
patent after the term has expired. Sa
America ito ah, okay lang yun kung
pinas.
Mechanical devise, he got his patent for
example after 17 years. Nung
ininterview sya, what are your plans?
Kasi ginamit na ng maraming
manufacturers yung invention nya. So he
coud collect for royalties. Sa 1 dollar na
lang per wiper. Kaya lang sabi nya, no
plans. He is happy that he has
contributed to humanity. Ang point ko
lang dito, you don’t get a patent right
away.
WHO is entitled to a patent? The
inventor. Kaya kung hindi ka inventor,
you are not entitled to patent.
Rule 1. is that patent is issued to an
inventor.
Rule 2. If two or more persons work on
an invention together, in the absence of
an agreement to the contrary, they
become co-owners of the patent.
Kunyari there are two or more persons
thinking of the same invention, isa taga
Batanes then yung isa taga Cebu then
yung isa Tawi Tawi. In short,
individually, all of them are working on
the same invention. Fortunately, all of
them were able to come up with a
common invention. Iba deisgn but doing
the same thing. In that case, who get the
patent? The one who first filed the
application gets the patent. Yan ang
tinatawag na first to file rule.
Rule 4. This involves the principle of
agency where the act of the agent is
considered as act of the principal. If a
person hired another purposely to work
on an invention. In the absence of
agreement to the contrary, patent
belongs to the employer.
Ex: Meron akong cosmetic
manufacturing company. Nabalitaan ko,
nung naggraduate ka sa Chemistry,
summa cum laude katapos kumuha ka ng
board exam where you are a topnotcher.
In short, I invited you to work with me.
In short, you were able to develop a
product. Sino may ari ng patent?
Employer. That is in the absence of an
agreement to the contrary.
Rule 5. If a person hires another to do
something else, although the employee
may have done the invention during his
working hours and may have even used
the resources of the employer, the patent
belongs to the employee.
Ex: Meron akong factory and madami
ako pilferage. Madami na security guard
pero madami padin nawawala kasi
tutulog tulog. I hired you to work as a
security guard to look after my factory
from 6PM to 6AM. May nakita kang
scrap materials and you were able to
come up with an invention. Sino may ari
ng patent? The employee. Kasi hindi
naman yun ang trabaho nya. Ang trabaho
nya ay to look after the premises.
How do you know if an invention is
covered by a patent? Dapat nakalagay
yung patent number. If there is an article,
nakalagay patent number, that means
that is covered by a patent and no longer
patentable.
A patent is a property which is separate
and distinct with the patented property.
They may be dealt with separately.
Kunwari, ako inventor. Taking
advantage of my patent, I mass produced
my invention, kaya yung aking bodega
punong puno na agad hanggangsa
bubong. Say I have 500 units of my
invention then one day you approached
me asking kung pwede mo bilhin yung
patent. I accepted the offer then binenta
ko sayo yung patent. Yung object ng sale
ay yung patent lang. Kasama ba yung
finished products? Hindi. Patent is one
property then the article is another
property.
Ngayon, binenta ko isang finished
product. Having bought, did you become
a co-owner of the patented product? No,
because they may be dealt with
separately.
How does a patent holder take advantage
of his patent?
If you have patent, you have the
exclusive right to mass produce or
license the mass production of the
patented article.
Kung hindi mo gusto magmass produce,
you can take advantage of your patent by
licensing another to mass produce.
What are the types of licensing?
1. Voluntary which is by agreement
of the parties; and
2. Compulsary when you apply
with the IPO.
There are prohibited stipulations in the
licensing agreement between the patent
holder and the licensee. There are 19 of
them. Sa 20, “any other similar
stipulations”.
One prohibited stipulation is that the
licensee shall not export or the licensee
shall limit his production to a certain
quantity.
Royalties are computed in the manner
provided by law
Kung meron patent and it is copied by
another without authority from the patent
holder, yun yung tinatawag na
infringement of a patent. Pwede lang
magkaroon ng infringement of a patent
kung meron patent. Kung walang patent,
walang infringement. Wala maviviolate.
Your invention is not patentable. It is not
prohibited by law. Can you mass
produce it? Yes. An invention may not
be patentable but it doesn’t mean that it
may not be mas produced. It can still be
mass produced for as long is it not
prohibited by law. Kung yan ay contrary
to morals, ang magagalit lang jan ay mga There may also be criminal prosecution
pari at madre. Kaya lang ano karapatan but this is allowed only if the infringer
nila magmass produced. would repeat. Kung matigas ulo at tuloy
padin, no criminal prosecution.
Kahapon natraffic ako sa Edsa,
napatingin ako sa isang billboard. Meron
pala condom na glow in the dark. Ang
tatak Premiere. Pag glow in the dark di
ka na mangangapa. Ngayon kunyari
wala pang patent, pwedi ba mass
produce? Yes.

Ex: Meron ako invention na hindi

patentable, nainggit ka. kinopya mo. Can
you sue me for infringement of a patent?
No.

Now, kung kinopya na eksaktong eksato

then you passed the product as mine.
Pwede ba kita kasuhan? Yes, for unfair
competition punishable under the
Revised Penal Code. Okay lang
kopyahin mo pero ibahin mo packaging.
Pero kung kinopya mo eksatong eksakto
yung produkto pero hindi yung
packaging, wala unfair competition.

What are the remedies in case of

infringement of a patent?

In case of infringement of a patent, civil

case for injunction and in the same case
a claim for actual damages. Eto ngayon
ang problema, under the law when you
recover actual damages, you have to
prove it. But then, proving actual
damages in an infringement case is
difficult. Kinopya mo ang invention,
pano mapuprove actual damages? If you
cannot prove the actual damages, then
the infringer may just be required to pay
royalties. Kasi mas madaling compute
yun. Sasabihin lang ng court sa infringer,
bring all your record of sales then base
doon, compute royalties.