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Albenson Enterprises v.

Court of Appeals
G.R. No. 88694

Petitioner Albenson Enterprises Corporation delivered to Guaranteed Industries, Inc. at Baltao Building
mild steel plates which the latter ordered and as part of the payment, a bouncing check was issued by one
“Eugenio Baltao”.

Petitioner, in a sincere attempt to collect the sum of money due them, filed a criminal complaint against
private respondent Eugenio S. Baltao after the latter refused to make good the amount of the bouncing
check despite demand. However, there was a mistake of identity as there were two “Eugenio Baltaos”
conducting business in the same building – Eugenio S. Baltao and his son, Eugenio Baltao III.

It was found that the signature of the check was not of Eugenio S. Baltao and because of the alleged unjust
filing of a criminal case against him, respondent Baltao filed a complaint for damages anchored on Articles
19, 20, and 21 of the Civil Code against petitioners.

Whether or not the principle of abuse of rights (Article 19) has been violated, resulting in damages under
Articles 20 and 21 or other applicable provision of law.

No, petitioners could not be said to have violated the principle of abuse of rights. What prompted
petitioners to file the case for violation of Batas Pambansa Bilang 22 against private respondent was their
failure to collect the amount of P2,575.00 due on a bounced check which they honestly believed was
issued to them by private respondent. Petitioners had conducted inquiries regarding the origin of the
check. Private respondent, however, did nothing to clarify the case of mistaken identity at first hand.
Instead, private respondent waited in ambush and thereafter pounced on the hapless petitioners at a
time he thought was propitious by filing an action for damages.

The elements of an abuse of right under Article 19 are the following: (1) There is a legal right or duty; (2)
which is exercised in bad faith; (3) for the sole intent of prejudicing or injuring another. Article 20 speaks
of the general sanction for all other provisions of law which do not especially provide for their own
sanction. Thus, anyone who, whether willfully or negligently, in the exercise of his legal right or duty,
causes damage to another, shall indemnify his victim for injuries suffered thereby. Article 21 deals with
acts contra bonus mores, and has the following elements: 1) There is an act which is legal; 2) but which is
contrary to morals, good custom, public order, or public policy; 3) and it is done with intent to injure.

There is no proof or showing that petitioners acted maliciously or in bad faith in the filing of the case
against private respondent. Consequently, in the absence of proof of fraud and bad faith committed by
petitioners, they cannot be held liable for damages.

Cebu Country Club, Inc. (CCCI) et al., v. Elizagaque

G.R. No. 160273
Cebu Country Club, Inc. (CCCI), petitioner, is a domestic corporation operating as a non-profit and non-
stock private membership club, having its principal place of business in Banilad, Cebu City. Petitioners
herein are members of its Board of Directors. In 1996, respondent filed with CCCI an application for
proprietary membership. The application was indorsed by CCCI’s two (2) proprietary members, namely:
Edmundo T. Misa and Silvano Ludo. As the price of a proprietary share was around the P5 million range,
Benito Unchuan, then president of CCCI, offered to sell respondent a share for only P3.5 million.
Respondent, however, purchased the share of a certain Dr. Butalid for only P3 million. Consequently, on
September 6, 1996, CCCI issued Proprietary Ownership Certificate No. 1446 to respondent.

During the meetings dated April 4, 1997 and May 30, 1997 of the CCCI Board of Directors, action on
respondent’s application for proprietary membership was deferred. In another Board meeting held on
July 30, 1997, respondent’s application was voted upon. As shown by the records, the Board adopted a
secret balloting known as the “black ball system” of voting wherein each member will drop a ball in the
ballot box. A white ball represents conformity to the admission of an applicant, while a black ball means
disapproval. Pursuant to Section 3(c), as amended, cited above, a unanimous vote of the directors is
required. When respondent’s application for proprietary membership was voted upon during the Board
meeting on July 30, 1997, the ballot box contained one (1) black ball. Thus, for lack of unanimity, his
application was disapproved.

On August 6, 1997, Edmundo T. Misa, on behalf of respondent, wrote CCCI a letter of reconsideration. As
CCCI did not answer, respondent, on October 7, 1997, wrote another letter of reconsideration. Still, CCCI
kept silent. On November 5, 1997, respondent again sent CCCI a letter inquiring whether any member of
the Board objected to his application. Again, CCCI did not reply. Consequently, on December 23, 1998,
respondent filed with the Regional Trial Court (RTC), Branch 71, Pasig City a complaint for damages against

Whether in disapproving respondent’s application for proprietary membership with CCCI, petitioners are
liable to respondent for damages, and if so, whether their liability is joint and several.


In rejecting respondent’s application for proprietary membership, we find that petitioners violated the
rules governing human relations, the basic principles to be observed for the rightful relationship between
human beings and for the stability of social order. The trial court and the Court of Appeals aptly held that
petitioners committed fraud and evident bad faith in disapproving respondent’s applications. This is
contrary to morals, good custom or public policy. Hence, petitioners are liable for damages pursuant to
Article 19 in relation to Article 21 of the same Code.

It bears stressing that the amendment to Section 3(c) of CCCI’s Amended By-Laws requiring the unanimous
vote of the directors present at a special or regular meeting was not printed on the application form
respondent filled and submitted to CCCI. What was printed thereon was the original provision of Section
3(c) which was silent on the required number of votes needed for admission of an applicant as a
proprietary member.

Petitioners explained that the amendment was not printed on the application form due to economic
reasons. We find this excuse flimsy and unconvincing. Such amendment, aside from being extremely
significant, was introduced way back in 1978 or almost twenty (20) years before respondent filed his
application. We cannot fathom why such a prestigious and exclusive golf country club, like the CCCI, whose
members are all affluent, did not have enough money to cause the printing of an updated application

It is thus clear that respondent was left groping in the dark wondering why his application was
disapproved. He was not even informed that a unanimous vote of the Board members was required.
When he sent a letter for reconsideration and an inquiry whether there was an objection to his
application, petitioners apparently ignored him. Certainly, respondent did not deserve this kind of
treatment. Having been designated by San Miguel Corporation as a special non-proprietary member of
CCCI, he should have been treated by petitioners with courtesy and civility. At the very least, they should
have informed him why his application was disapproved.

The exercise of a right, though legal by itself, must nonetheless be in accordance with the proper norm.
When the right is exercised arbitrarily, unjustly or excessively and results in damage to another, a legal
wrong is committed for which the wrongdoer must be held responsible.

Section 31 of the Corporation Code provides:

SEC. 31. Liability of directors, trustees or officers. — Directors or trustees who willfully and
knowingly vote for or assent to patently unlawful acts of the corporation or who are guilty of gross
negligence or bad faith in directing the affairs of the corporation or acquire any personal or
pecuniary interest in conflict with their duty as such directors, or trustees shall be liable jointly and
severally for all damages resulting therefrom suffered by the corporation, its stockholders or
members and other persons.

The challenged Decision and Resolution of the Court of Appeals are AFFIRMED with modification in the
sense that (a) the award of moral damages is reduced fromP2,000,000.00 to P50,000.00; (b) the award of
exemplary damages is reduced from P1,000,000.00 toP25,000.00; and (c) the award of attorney’s fees
and litigation expenses is reduced from P500,000.00 andP50,000.00 to P50,000.00 and P25,000.00,

Globe Mackay Cable v Court of Appeals

G.R. No. 142943

November 10, 1972, herein private respondent, Restituto Tobias, a purchasing agent and administrative
assistant to the engineering operations manager, discovered fictitious purchases and other fraudulent
transactions, which caused Globe Mackay Cable and Radio Corp loss of several thousands of pesos. He
reported it to his immediate superior Eduardo T. Ferraren and to the Executive Vice President and General
Manager Herbert Hendry. A day after the report, Hendry told Tobias that he was number one suspect and
ordered him one week forced leave. When Tobias returned to work after said leave, Hendry called him a
“crook” and a “swindler”, ordered him to take a lie detector test, and to submit specimen of his
handwriting, signature and initials for police investigation. Moreover, petitioners hired a private
investigator. Private investigation was still incomplete; the lie detector tests yielded negative results;
reports from Manila police investigators and from the Metro Manila Police Chief Document Examiner are
in favor of Tobias. Petitioners filed with the Fiscal’s Office of Manila a total of six (6) criminal cases against
private respondent Tobias, but were dismissed.

Tobias received a notice of termination of his employment from petitioners in January 1973, effective
December 1972. He sought employment with the Republic Telephone Company (RETELCO); but Hendry
wrote a letter to RETELCO stating that Tobias was dismissed by Globe Mackay due to dishonesty. Tobias,
then, filed a civil case for damages anchored on alleged unlawful, malicious, oppressive, and abusive acts
of petitioners. The Regional Trial Court of Manila, Branch IX, through Judge Manuel T. Reyes rendered
judgment in favor of private respondent, ordering petitioners to pay him eighty thousand pesos
(P80,000.00) as actual damages, two hundred thousand pesos (P200,000.00) as moral damages, twenty
thousand pesos (P20,000.00) as exemplary damages, thirty thousand pesos (P30,000.00) as attorney’s
fees, and costs; hence, this petition for review on certiorari.

Whether or not Globe Mackay should be held liable for the failure of the delivery of the cablegram.

Yes. Globe Mackay should be held liable, and should be corrected for public good since the company is a
quasi-public corporation with duties to the general public and is liable to any member of the public to
whom it owes a duty for damages proximately flowing from a violation of that duty.

Article 19 provides that: “Every person must, in the exercise of his rights and in the performance of his
duties, act with justice, give everyone his due, and observe honesty and good faith”. This article, known
to contain what is commonly referred to as the principle of abuse of rights, sets certain standards which
must be observed not only in the exercise of one’s rights but also in the performance of one’s duties.
These standards are the following: to act with justice; to give everyone his due; and to observe honesty
and good faith. The law, therefore, recognizes a primordial limitation on all rights; that in their exercise,
the norms of human conduct set forth in Article 19 must be observed.

The Court, after examining the record and considering certain significant circumstances, finds that all
petitioners have indeed abused the right that they invoke, causing damage to private respondent and for
which the latter must now be indemnified: when Hendry told Tobias to just confess or else the company
would file a hundred more cases against him until he landed in jail; his (Hendry) scornful remarks about
Filipinos (“You Filipinos cannot be trusted.”) as well as against Tobias (“crook”, and “swindler”); the writing
of a letter to RETELCO stating that Tobias was dismissed by Globe Mackay due to dishonesty; and the filing
of six criminal cases by petitioners against private respondent. All these reveal that petitioners are
motivated by malicious and unlawful intent to harass, oppress, and cause damage to private respondent.
The imputation of guilt without basis and the pattern of harassment during the investigations of Tobias
transgress the standards of human conduct set forth in Article 19 of the Civil Code.


G. R. No. 97336

Petitioner: Gasheem Shookat Baksh

Respondent: Marilou Gonzales

Petitioner was a medicine student at Lyceum Northwestern Colleges at Dagupan City. He was an Iranian
exchange student and was 29 years old. Respondent was a former waitress on a luncheonette, and was
22 years old. Petitioner was allegedly the lover of the respondent, and was said to promise marriage to
the latter, which convinced her to live with him in his apartment. It was even alleged that the petitioner
went to the house of the respondent to inform her family about the marriage on the end of the semester.
However, the marriage did not materialize, with several beatings and maltreatment experienced by the
respondent from the petitioner.

The case was filed in the RTC of Pangasinan, and the decision was held in favor of the respondent.
However, the petitioner claimed that the judgment of the RTC was an error, for the claims of the
respondent are not true, and that he did not know about the custom of the Filipinos; his acts were in
accordance of his custom. The decision of the RTC was affirmed in toto by the Court of Appeals. Hence,
the petitioner filed an appeal to the Supreme Court.

Whether or not the respondent could claim payment for the damages incurred by the petitioner.

Mere breach of marriage is not punishable by law. However, since the respondent was proved to have a
good moral character, and that she had just let her virginity be taken away by the petitioner since the
latter offered a promise of marriage, then she could ask for payment for damages. Furthermore, since she
let her lover, the petitioner, “deflowered” her since she believed that his promise to marry was true, and
not due to her carnal desire, then she could have her claims against the petitioner. Moreover, the father
of the respondent had already looked for pigs and chicken for the marriage reception and the sponsors
for the marriage, and then damages were caused by the petitioner against the respondents, which
qualified the claims of the respondent against the petitioner.

Bunag, Jr. v. Court of Appeals, et al.

G.R. No. 101749

Petitioner: CONRADO BUNAG, JR.

Respondents: HON. COURT OF APPEALS, First Division, and ZENAIDA B. CIRILO,

Plaintiff and defendant Bunag, Jr. were sweethearts, he invited her to take their merienda at the Aristocrat
Restaurant in Manila, to which plaintiff obliged. But instead to Aristocrat he brought plaintiff to a motel
or hotel where he raped her. Later that evening, defendant brought plaintiff to the house of his
grandmother Juana de Leon in Pamplona, Las Piñas, Metro Manila, where they lived together as husband
and wife for 21 days.

Defendant-appellant Bunag, Jr. and plaintiff-appellant filed their respective applications for a marriage
license with the Office of the Local Civil Registrar of Bacoor, Cavite. October 1, 1973 Defendant-appellant
Bunag, Jr. filed an affidavit withdrawing his application for a marriage license.

Defendant Bunag, Jr. left and never returned, humiliating plaintiff and compelled her to go back to her
parents. Plaintiff was ashamed when she went home and could not sleep and eat because of the deception
done against her by defendants-appellants. Petitioner filed a complaint for damages for alleged breach of
promise to marry.

The trial court ruled in favor of the plaintiff and against petitioner, but absolved his father.

Whether or not the failure to comply with the promise of marriage of the defendant considered contrary
to morals, good custom or public policy.

It is true that in this jurisdiction, we adhere to the time-honored rule that an action for breach of promise
to marry has no standing in the civil law, apart from the right to recover money or property advanced by
the plaintiff upon the faith of such promise. Generally, therefore, a breach of promise to marry per se is
not actionable, except where the plaintiff has actually incurred expenses for the wedding and the
necessary incidents thereof.

Radio Communications of the Philippines, Inc. V Court of Appeals

GR No. L-44748.

Loreto Dionela filed a complaint of damages against Radio Communiciations of the Philippines, Inc. (RCPI)
due to the telegram sent through its Manila Office to the former, reading as follows:

115 PM

Loreto Dionela alleges that the defamatory words on the telegram sent to him wounded his feelings,
caused him undue embarrassment and affected adversely his business because other people have come
to know of said defamatory words. RCPI alleges that the additional words in Tagalog was a private joke
between the sending and receiving operators, that they were not addressed to or intended for plaintiff
and therefore did not form part of the telegram, and that the Tagalog words are not defamatory.

The RTC ruled that the additional words are libelous for any person reading the same would logically think
that they refer to Dionela, thus RCPI was ordered to pay moral damages in the amount of P40, 000.00.
The Court of Appeals affirmed the decision ruling that the company was negligent and failed to take
precautionary steps to avoid the occurrence of the humiliating incident, and the fact that a copy of the
telegram is filed among other telegrams and open to public is sufficient publication; however reducing
the amount awarded to P15, 000.00

Whether or not the company should answer directly and primarily for the civil liability arising from the
criminal act of its employee.

Yes. The cause of action of the private respondent is based on Arts. 19 and 20 of the New Civil Code, as
well as on respondent’s breach of contract thru the negligence of its own employees. By adding
extraneous and libelous matters in the message sent to the private respondent, there is a clear breach of
contract; for upon payment of the fixed rate, the company undertakes to transmit the message accurately.

In contracts, the negligence of the employee (servant) is the negligence of the employer (master). This is
the master and servant rule. As a corporation, the petitioner can act only through its employees. Hence
the acts of its employees in receiving and transmitting messages are the acts of the petitioner. To hold
that the petitioner is not liable directly for the acts of its employees in the pursuit of petitioner’s business
is to deprive the general public availing of the services of the petitioner of an effective and adequate

In most cases, negligence must be proved in order that plaintiff may recover. However, since negligence
may be hard to substantiate in some cases, we may apply the doctrine of RES IPSA LOQUITUR (the thing
speaks for itself), by considering the presence of facts or circumstances surrounding the injury.
The judgment of the CA is affirmed.

GR No. L-20089

BEATRIZ P. WASSMER, plaintiff-appellee

FRANCISCO X. VELEZ, defendant-appeallant

Francisco Velez and Beatriz Wassmer planned to get married. However, Velez went away and Beatriz did
not hear from him again. Beatriz sued Francisco and asked the latter to pay her moral damages. Velez
contended that there is no provision of the law authorizing an action for breach of promise to marry.
However, the court did not find this defense meritorious because even though it is true that there is no
law for breach of promise to marry, Wassmer still suffered frustration and public humiliation.
Did the court err in ordering the defendant to pay plaintiff moral damages?

The case at bar is not a mere breach of promise to marry because it is not considered an actionable wrong.
The mere fact the couple have already filed a marriage license and already spent for invitations, wedding
apparels, gives the plaintiff reason to demand for payment of damages. The court affirmed the previous
judgment and ordered the defendant to pay the plaintiff moral damages for the humiliation she suffered;
actual damages for the expenses incurred and exemplary damages because the defendant acted
fraudulently in making the plaintiff believe that he will come back and the wedding will push through.


G.R. NO. 83974

The Dela Cruz sisters were the aunts of Dolores Rongavilla. They borrowed P2,000 from the Rongavillas to
have their rooftop repaired. Later, petitioners went back to their aunts to have them sign a contract.
Taking advantage of their lack of education, the sisters were made to believe that such document,
typewritten in English, was just for the acknowledgment of their debt. After four years, petitioners asked
their aunts to vacate the land subject to litigation claiming that she and her husband were the new
owners. After verifying with the Registry of Deeds, the aunts were surprised that what they have signed
was actually a deed of sale. Their land title was cancelled and the ownership was transferred to their
nephews. The land was mortgaged with the Cavite Development Bank.

Was the deed of sale void?

Yes. While petitioners claimed they were regularly paying taxes on the land in question, they had no
second thoughts stating at the trial and on appeal that they had resorted to doctoring the price stated in
the disputed Deed of Sale, allegedly to save on taxes. While it is true that public documents are presumed
genuine and regular under the Rules of Court, this presumption is a rebuttable presumption which may
be overcome by clear, strong and convincing evidence.