7 July 2013 Civil Law.doc

8/13/2019 7 July 2013 Civil Law.doc

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July 2013 Philippine Supreme Court Decisions on Civil Law

Posted on August 23, 2013 Posted in Civil Law, Philippines - Cases,

Philippines - Law

Here are select Jul 2013 rulings o! the "upre#e Court o! the

Philippines in civil law$

Civil Code

Agenc% apparent authorit o! an agent &ased on estoppel% concept' (n

Woodchild Holdings, Inc. v. Roxas Electric and Construction Company,

Inc. the Court stated that )persons dealing with an assu#ed agenc,

whether the assu#ed agenc &e a general or special one, are &ound attheir peril, i! the would hold the principal lia&le, to ascertain not onl

the !act o! agenc &ut also the nature and e*tent o! authorit, and in case

either is controverted, the &urden o! proo! is upon the# to esta&lish it'+

(n other words, when the petitioner relied onl on the words o!

respondent Aleandro without securing a cop o! the "PA in !avor o! the

latter, the petitioner is &ound & the ris acco#paning such trust on the

#ere assurance o! Aleandro'

.he sa#e Woodchild case stressed that apparent authorit &ased on

estoppel can arise !ro# the principal who nowingl per#it the agent to

hold hi#sel! out with authorit and !ro# the principal who clothe the

agent with indicia o! authorit that would lead a reasona&l prudent

person to &elieve that he actuall has such authorit' Apparent authorit

o! an agent arises onl !ro# )acts or conduct on the part o! the principal

and such acts or conduct o! the principal #ust have &een nown and

relied upon in good !aith and as a result o! the e*ercise o! reasona&le

prudence & a third person as clai#ant and such #ust have produced achange o! position to its detri#ent'+ (n the instant case, the sale to the

"pouses Laarca and other transactions where Aleandro allegedl

represented a considera&le #aorit o! the co-owners transpired a!ter the

sale to the petitioner% thus, the petitioner cannot rel upon these acts or

conduct to &elieve that Aleandro had the sa#e authorit to negotiate !or
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the sale o! the su&ect propert to hi#'Reman Recio v. Heirs of Spouses

Aguego and aria Altamirano, /'' o'1234, Jul 2, 2013'

Agenc% de!inition under the Civil Code% !or# o! contract' Article 15

o! the Civil Code de!ines a contract o! agenc as a contract where& aperson )&inds hi#sel! to render so#e service or to do so#ething in

representation or on &ehal! o! another, with the consent or authorit o!

the latter'+ (t #a &e e*press, or i#plied !ro# the acts o! the principal,

!ro# his silence or lac o! action, or his !ailure to repudiate the agenc,

nowing that another person is acting on his &ehal! without authorit'

As a general rule, a contract o! agenc #a &e oral'

However, it #ust &e written when the law re6uires a speci!ic !or#'

"peci!icall, Article 17 o! the Civil Code provides that the contract o!

agenc #ust &e written !or the validit o! the sale o! a piece o! land or

an interest therein' 8therwise, the sale shall &e void' A related

provision, Article 17 o! the Civil Code, states that special powers o!

attorne are necessar to conve real rights over i##ova&le properties'

Sally !oshi"a#i v. $oy %raining Center of Aurora, Inc', /'' o' 1747,

Jul 31, 2013'

Agenc% general power o! attorne% an agenc couched in general ter#s

co#prises onl acts o! ad#inistration' .he certi!ication is a #ere general

power o! attorne which co#prises all o! Jo .raining9s &usiness'

Article 177 o! the Civil Code clearl states that ):a;n agenc couched

in general ter#s co#prises onl acts o! ad#inistration, even if the

principal should state that he withholds no power or that the agent

may eecute such acts as he may consider appropriate! or even

though the agency should authori"e a general and unlimitedmanagement#$ Sally !oshi"a#i v. $oy %raining Center of Aurora, Inc',

/'' o' 1747, Jul 31, 2013'
http://sc.judiciary.gov.ph/jurisprudence/2013/july2013/182349.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/182349.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdf


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Agenc% sale o! propert & a supposed agent is unen!orcea&le i! there is

reall no agenc to sell such propert% persons dealing with an agent

#ust ascertain not onl the !act o! agenc, &ut also the nature and e*tent

o! the agent9s authorit' ecessaril, the a&sence o! a contract o! agenc

renders the contract o! sale unen!orcea&le% Jo .raining e!!ectivel didnot enter into a valid contract o! sale with the spouses e une6uivoca&l declared in Cosmic

&um'er Corporation v. Court of Appeals that a special power o! attorne

must epress the powers of the agent in clear and unmista%a&le

language !or the principal to con!er the right upon an agent to sell real

estate' >hen there is an reasona&le dou&t that the language so used

conves such power, no such construction shall &e given the docu#ent'

.he purpose o! the law in re6uiring a special power o! attorne in the

disposition o! i##ova&le propert is to protect the interest o! an

unsuspecting owner !ro# &eing preudiced & the unwarranted act o!

another and to caution the &uer to assure hi#sel! o! the speci!ic

authori=ation o! the putative agent' Sally !oshi"a#i v. $oy %rainingCenter of Aurora, Inc', /'' o' 1747, Jul 31, 2013'

Agenc% special power o! attorne !or sale o! propert% #ust e*pressl

#ention a sale or include a sale as a necessar ingredient o! the

authori=ed act' .he special power o! attorne #andated & law must &e
http://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdf


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one that epressly mentions a sale or that includes a sale as a

necessary ingredient of the authori"ed act# >e une6uivoca&l

declared in Cosmic &um'er Corporation v. Court of Appeals that a

special power o! attorne must epress the powers of the agent in

clear and unmista%a&le language !or the principal to con!er the rightupon an agent to sell real estate' >hen there is an reasona&le dou&t that

the language so used conves such power, no such construction shall &e

given the docu#ent' .he purpose o! the law in re6uiring a special power

o! attorne in the disposition o! i##ova&le propert is to protect the

interest o! an unsuspecting owner !ro# &eing preudiced & the

unwarranted act o! another and to caution the &uer to assure hi#sel! o!

the speci!ic authori=ation o! the putative agent' Sally !oshi"a#i v. $oy

%raining Center of Aurora, Inc', /'' o' 1747, Jul 31, 2013'

Agenc% special power o! attorne% re6uired !or an agent to sell an

i##ova&le propert% authorit #ust &e in writing, otherwise sale is void'

(nAlcantara v. (ido, the Court e#phasi=ed the re6uire#ent o! an "PA

&e!ore an agent #a sell an i##ova&le propert' (n the said case,

evelen was the owner o! the su&ect land' Her #other, respondent

?rigida ido accepted the petitioners9 o!!er to &u evelen9s land at

.wo Hundred Pesos @P200'00 per s6 #' However, ido was onl

authori=ed ver&all & evelen' .hus, the Court declared the sale o! the

said land null and void under Articles 17 and 17 o! the Civil Code'

Reman Recio v. Heirs of Spouses Aguego and aria Altamirano, /''

o'1234, Jul 2, 2013'

Arrastre operator% !unctions% dut to tae good care o! goods and to turn

the# over to the part entitled to their possession' .he !unctions o! an

arrastre operator involve the handling o! cargo deposited on the whar! or&etween the esta&lish#ent o! the consignee or shipper and the ship9s

tacle' ?eing the custodian o! the goods discharged !ro# a vessel, an

arrastre operator9s dut is to tae good care o! the goods and to turn

the# over to the part entitled to their possession' Handling cargo is

#ainl the arrastre operator9s principal wor so its driversBoperators or
http://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/182349.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/182349.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/174978.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/182349.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/182349.pdf


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e#ploees should o&serve the standards and #easures necessar to

prevent losses and da#age to ship#ents under its custod'Asian

%erminals, Inc. v. )hilam Insurance Co., Inc. *no+ Chartis )hilippines

Insurance Inc.- )hilam Insurance Co., Inc. *no+ Chartis )hilippines

Insurance Inc. v. West+ind Shipping Corporation and Asian %erminals,Inc.- West+ind Shipping Corporation v. )hilam Insurance Co., Inc. and

Asian %erminals, Inc.,/'' os' 11153B11252B11314, Jul 2, 2013'

Attorne9s !ees% dual concept' (n order to resolve the issues in this case,

it is necessar to discuss the two concepts o! attorne9s !ees ordinar

and e*traordinar' (n its ordinar sense, it is the reasona&le

co#pensation paid to a lawer & his client !or legal services rendered'

(n its e*traordinar concept, it is awarded & the court to the success!ullitigant to &e paid & the losing part as inde#nit !or da#ages'

rancisco &. Rosario, $r. v. &ellani /e 0u"man, Arleen /e 0u"man, et

al., /'' o' 14127, Jul 10, 2013'

Attorne9s !ees !or pro!essional services rendered% #a &e clai#ed in

the ver action itsel! or in a separate action% prescription !or oral contract

o! attorne9s !ees is 5 ears% concept o! 6uantu# #eruit% guidelines

under the Code o! Pro!essional esponsi&ilit' .he Court now addresses

two i#portant 6uestions$ @1 How can attorne9s !ees !or pro!essionalservices &e recoveredD @2 >hen can an action !or attorne9s !ees !or

pro!essional services &e !iledD .he case o! .raders oal ?an

E#ploees Fnion-(ndependent v' LC is instructive$

As an adunctive episode o! the action !or the recover o! &onus

di!!erentials in LC-C Certi!ied Case o' 055, private

respondent9s present clai# !or attorne9s !ees #a &e !iled &e!ore the

LC even though or, &etter stated, especiall a!ter its earlier decisionhad &een reviewed and partiall a!!ir#ed' (t is well settled that a clai#

!or attorne9s !ees #a &e asserted either in the ver action in which the

services o! a lawer had &een rendered or in a separate action'


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>ith respect to the !irst situation, the re#ed !or recovering attorne9s

!ees as an incident o! the #ain action #a &e availed o! onl when

so#ething is due to the client' Attorne9s !ees cannot &e deter#ined

until a!ter the #ain litigation has &een decided and the su&ect o! the

recover is at the disposition o! the court' .he issue over attorne9s !eesonl arises when so#ething has &een recovered !ro# which the !ee is to

&e paid' >hile a clai# !or attorne9s !ees #a &e !iled &e!ore the

udg#ent is rendered, the deter#ination as to the propriet o! the !ees or

as to the a#ount thereo! will have to &e held in a&eance until the #ain

case !ro# which the lawer9s clai# !or attorne9s !ees #a arise has

&eco#e !inal' 8therwise, the deter#ination to &e #ade & the courts will

&e pre#ature' 8! course, a petition !or attorne9s !ees #a &e !iled

&e!ore the udg#ent in !avor o! the client is satis!ied or the proceedsthereo! delivered to the client'

(t is apparent !ro# the !oregoing discussion that a lawer has two

options as to when to !ile his clai# !or pro!essional !ees' Hence, private

respondent was well within his rights when he #ade his clai# and

waited !or the !inalit o! the udg#ent !or holida pa di!!erential,

instead o! !iling it ahead o! the award9s co#plete resolution' .o declare

that a lawer #a !ile a clai# !or !ees in the sa#e action onl &e!ore the

udg#ent is reviewed & a higher tri&unal would deprive hi# o! his

a!orestated options and render ine!!ective the !oregoing pronounce#ents

o! this Court'

(n this case, petitioner opted to !ile his clai# as an incident in the #ain

action, which is per#itted & the rules' As to the ti#eliness o! the !iling,

this Court holds that the 6uestioned #otion to deter#ine attorne9s !ees

was seasona&l !iled'

.he records show that the August , 144 .C decision &eca#e !inal

and e*ecutor on 8cto&er 31, 2007' .here is no dispute that petitioner

!iled his Gotion to eter#ine Attorne9s Iees on "epte#&er , 2004,

which was onl a&out one @1 ear and eleven @11 #onths !ro# the

!inalit o! the .C decision' ?ecause petitioner clai#s to have had an


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oral contract o! attorne9s !ees with the deceased spouses, Article 11

o! the Civil Code15 allows hi# a period o! si* @5 ears within which to

!ile an action to recover pro!essional !ees !or services rendered'

espondents never asserted or provided an evidence that "pouses de

/u=#an re!used petitioner9s legal representation' Ior this reason,petitioner9s cause o! action &egan to run onl !ro# the ti#e the

respondents re!used to pa hi# his attorne9s !ees, as si#ilarl held in

the case o! Anido v' egado'

>ith respect to petitioner9s entitle#ent to the clai#ed attorne9s !ees, it

is the Court9s considered view that he is deserving o! it and that the

a#ount should &e &ased on 6uantu# #eruit' Kuantu# #eruit literall

#eaning as #uch as he deserves is used as &asis !or deter#ining anattorne9s pro!essional !ees in the a&sence o! an e*press agree#ent' .he

recover o! attorne9s !ees on the &asis o! 6uantu# #eruit is a device

that prevents an unscrupulous client !ro# running awa with the !ruits o!

the legal services o! counsel without paing !or it and also avoids unust

enrich#ent on the part o! the attorne hi#sel!' An attorne #ust show

that he is entitled to reasona&le co#pensation !or the e!!ort in pursuing

the client9s cause, taing into account certain !actors in !i*ing the

a#ount o! legal !ees'

ule 20'01 o! the Code o! Pro!essional esponsi&ilit lists the

guidelines !or deter#ining the proper a#ount o! attorne !ees, to wit$

ule 20'1 A lawer shall &e guided & the !ollowing !actors in

deter#ining his !ees$

a .he ti#e spent and the e*tent o! the services rendered or re6uired%

& .he novelt and di!!icult o! the 6uestions involved%

c .he i#portance o! the su&ect #atter%

d .he sill de#anded%


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e .he pro&a&ilit o! losing other e#plo#ent as a result o! acceptance

o! the pro!!ered case%

! .he custo#ar charges !or si#ilar services and the schedule o! !ees o!

the (?P chapter to which he &elongs%

g .he a#ount involved in the controvers and the &ene!its resulting to

the client !ro# the service%

h .he contingenc or certaint o! co#pensation%

i .he character o! the e#plo#ent, whether occasional or esta&lished%

and

.he pro!essional standing o! the lawer'

rancisco &. Rosario, $r. v. &ellani /e 0u"man, Arleen /e 0u"man, et

al., /'' o' 14127, Jul 10, 2013'

Attorne9s !ees% recovera&le in actions !or inde#nit under wor#en9s

co#pensation and e#ploer9s lia&ilit laws' However, the Court !inds

that the petitioner is entitled to attorne9s !ees pursuant to Article

220@ o! the Civil Code which states that the award o! attorne9s !ees

is usti!ied in actions !or inde#nit under wor#en9s co#pensation and

e#ploer9s lia&ilit laws' Camilo A. Esguerra v. 1nited )hilippines

&ines, Inc., et al.,/'' o' 144432, Jul 3, 2013'

Attorne9s !ees% when recovera&le' .he Court o! Appeals right!ull

upheld the LC9s a!!ir#ance o! the grant o! attorne9s !ees to "an

Giguel' .here&, the LC did not co##it an grave a&use o! its

discretion, considering that "an Giguel had &een co#pelled to litigateand to incur e*penses to protect his rights and interest' (n Producers

?an o! the Philippines v' Court o! Appeals, the Court ruled that

attorne9s !ees could &e awarded to a part who# an unusti!ied act o!

the other part co#pelled to litigate or to incur e*penses to protect his

interest' (t was plain that petitioner9s re!usal to reinstate "an Giguel with


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&acwages and other &ene!its to which he had &een legall entitled was

unusti!ied, there& entitling hi# to recover attorne9s !ees'2uellig

reight and Cargo Systems v. (ational &a'or Relations Commission, et

al.,/'' o' 17400, Jul 22, 2013

Attorne9s !ees% when recovera&le' >ith respect to the award o!

attorne9s !ees, Article 220 o! the Civil Code provides, a#ong others,

that such !ees #a &e recovered when e*e#plar da#ages are awarded,

when the de!endant9s act or o#ission has co#pelled the plainti!! to

litigate with third persons or to incur e*penses to protect his interest, and

where the de!endant acted in gross and evident &ad !aith in re!using to

satis! the plainti!!s9 plainl valid, ust and de#anda&le clai#'$oyce 3.

Ardiente v. Spouses $avier and a. %heresa )astofide,/'' o'151421, Jul 17, 2013'

Co##on carriers% e*traordinar diligence in vigilance o! goods

transported% cargoes while &eing unloaded generall re#ain under the

custod o! the carrier' Co##on carriers, !ro# the nature o! their

&usiness and !or reasons o! pu&lic polic, are &ound to o&serve

e*traordinar diligence in the vigilance over the goods transported &

the#' "u&ect to certain e*ceptions enu#erated under Article 173 o!

the Civil Code, co##on carriers are responsi&le !or the loss, destruction,or deterioration o! the goods' .he e*traordinar responsi&ilit o! the

co##on carrier lasts !ro# the ti#e the goods are unconditionall placed

in the possession o!, and received & the carrier !or transportation until

the sa#e are delivered, actuall or constructivel, & the carrier to the

consignee, or to the person who has a right to receive the#'Asian

%erminals, Inc. v. )hilam Insurance Co., Inc. *no+ Chartis )hilippines

Insurance Inc.- )hilam Insurance Co., Inc. *no+ Chartis )hilippines

Insurance Inc. v. West+ind Shipping Corporation and Asian %erminals,Inc.- West+ind Shipping Corporation v. )hilam Insurance Co., Inc. and



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Contract% a&solutel si#ulated contracts% void !ro# the &eginning' .he

Court is in accord with the o&servation and !indings o! the @.C,

ali&o, Alan thus$

).he a#plitude o! !oregoing undisputed !acts and circu#stances clearlshows that the sale o! the land in 6uestion was purel si#ulated' (t is

void !ro# the ver &eginning @Article 135, ew Civil Code' (! the sale

was legiti#ate, de!endant /lenda should have i##ediatel taen

possession o! the land, declared in her na#e !or ta*ation purposes,

registered the sale, paid realt ta*es, introduced i#prove#ents therein

and should not have allowed plainti!! to #ortgage the land' .hese

o#issions properl #ilitated against de!endant /lenda9s suission that

the sale was legiti#ate and the consideration was paid'

/r. &orna C. ormaran v. /r. 0lenda 4. 5ng and Solomon S. 5ng,

/'' o' 1525, Jul , 2013'

Contract o! sale% ele#ents' A valid contract o! sale re6uires$ @a a

#eeting o! #inds o! the parties to trans!er ownership o! the thing sold in

e*change !or a price% @& the su&ect #atter, which #ust &e a possi&le

thing% and @c the price certain in #one or its e6uivalent'Reman Recio

v. Heirs of Spouses Aguego and aria Altamirano, /'' o'1234,Jul 2, 2013'

Contract to sell% pa#ent o! the price% positive suspension condition%

e!!ect o! !ailure to pa' Clearl, the .C arrived at the a&ove-6uoted

conclusion &ased on its #istaen pre#ise that rescission is applica&le to

the case' Hence, its deter#ination o! whether there was su&stantial

&reach' As #a &e recalled, however, the CA, in its assailed ecision,

!ound the contract &etween the parties as a contract to sell, speci!icallo! a real propert on install#ent &asis, and as such categoricall

declared rescission to &e not the proper re#ed' .his is considering that

in a contract to sell, pa#ent o! the price is a positive suspensive

condition, !ailure o! which is not a &reach o! contract warranting

rescission under Article 1141 o! the Civil Code &ut rather ust an event


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that prevents the supposed seller !ro# &eing &ound to conve title to the

supposed &uer' Also, and as correctl ruled & the CA, Article 1141

cannot &e applied to sales o! real propert on install#ent since the are

governed & the Gaceda Law'

.here &eing no &reach to spea o! in case o! non-pa#ent o! the

purchase price in a contract to sell, as in this case, the .C9s !actual

!inding that Lourdes was willing and a&le to pa her o&ligation a

conclusion arrived at in connection with the said court9s deter#ination

o! whether the non-pa#ent o! the purchase price in accordance with the

ter#s o! the contract was a su&stantial &reach warranting rescission

there!ore loses signi!icance' .he spouses ?onrostro9s reliance on the

said !actual !inding is thus #isplaced' .he cannot invoe theirreadiness and willingness to pa their o&ligation on ove#&er 2, 1443

as an e*cuse !ro# &eing #ade lia&le !or interest &eond the said date'

Sps. (ameal and &ourdes 4onrostro v. Sps. $uan and Constacia &una,

/'' o'17235, Jul 2, 2013'

a#ages% da#ages !or loss o! earning capacit% #ust &e dul proven &

docu#entar evidence% e*ceptions' .he "upre#e Court agrees with the

Court o! Appeals when it re#oved the .C9s award respecting the

inde#nit !or the loss o! earning capacit' As it has alread previouslruled that da#ages !or loss o! earning capacit is in the nature o! actual

da#ages, which as a rule #ust &e dul proven & docu#entar evidence,

not #erel & the sel!-serving testi#on o! the widow'

? wa o! e*ception, da#ages !or loss o! earning capacit #a &e

awarded despite the a&sence o! docu#entar evidence when @1 the

deceased is sel!-e#ploed earning less than the #ini#u# wage under

current la&or laws, and udicial notice #a &e taen o! the !act that in thedeceased9s line o! wor no docu#entar evidence is availa&le% or @2 the

deceased is e#ploed as a dail wage worer earning less than the

#ini#u# wage under current la&or laws')eople of the )hilippines v.

0arry 3ergara y 5riel and $oseph Incencio y )aulino, /'' o'

177753, Jul 3, 2013


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a#ages% e*e#plar da#ages% concept' As !or e*e#plar da#ages,

Article 2224 provides that e*e#plar da#ages #a &e i#posed & wa

o! e*a#ple or correction !or the pu&lic good' onetheless, e*e#plar

da#ages are i#posed not to enrich one part or i#poverish another, &ut

to serve as a deterrent against or as a negative incentive to cur& socialldeleterious actions' (n the instant case, the Court agrees with the CA in

sustaining the award o! e*e#plar da#ages, although it reduced the

a#ount granted, considering that respondent spouses were deprived o!

their water suppl !or #ore than nine @4 #onths, and such deprivation

would have continued were it not !or the relie! granted & the .C'

$oyce 3. Ardiente v. Spouses $avier and a. %heresa )astofide,/''

o' 151421, Jul 17, 2013'

a#ages% e*e#plar da#ages% awarded i! there is an aggravating

circu#stance, whether ordinar or 6uali!ing' Fnlie the cri#inal

lia&ilit which is &asicall a "tate concern, the award o! e*e#plar

da#ages, however, is liewise, i! not pri#aril, intended !or the

o!!ended part who su!!ers there&' (t would #ae little sense !or an

award o! e*e#plar da#ages to &e due the private o!!ended part when

the aggravating circu#stance is ordinar &ut to &e withheld when it is

6uali!ing' >ithal, the ordinar or 6uali!ing nature o! an aggravating

circu#stance is a distinction that should onl &e o! conse6uence to the

cri#inal, rather than to the civil, lia&ilit o! the o!!ender' (n !ine, relative

to the civil aspect o! the case, an aggravating circu#stance, whether

ordinar or 6uali!ing, should entitle the o!!ended part to an award o!

e*e#plar da#ages within the un&ridled #eaning o! Article 2230 o! the

Civil Code.)eople of the )hilippines v. 0arry 3ergara y 5riel and

$oseph Incencio y )aulino,/'' o' 177753, Jul 3, 2013'

a#ages% interest thereon% where o&ligation does not constitute a loan or!or&earance o! #one' .he CA erred in i#posing an interest rate o! 12M

on the award o! da#ages' Fnder Article 2204 o! the Civil Code, when

an o&ligation not constituting a loan or !or&earance o! #one is

&reached, an interest on the a#ount o! da#ages awarded #a &e

i#posed at the discretion o! the court at the rate o! 5M per annu#' (n the


13/33

si#ilar case o! ?elgian 8verseas Chartering and "hipping N v'

Philippine Iirst (nsurance Co', lnc', the Court reduced the rate o! interest

on the da#ages awarded to the carrier therein to 5M !ro# the ti#e o! the

!iling o! the co#plaint until the !inalit o! the decision'Asian %erminals,

Inc. v. )hilam Insurance Co., Inc. *no+ Chartis )hilippines InsuranceInc.- )hilam Insurance Co., Inc. *no+ Chartis )hilippines Insurance

Inc. v. West+ind Shipping Corporation and Asian %erminals, Inc.-

West+ind Shipping Corporation v. )hilam Insurance Co., Inc. and


a#ages% #oral da#ages% when recovera&le' (n)hilippine (ational

4an# v. Spouses Rocamora, the "upre#e Court said that$

Goral da#ages are not recovera&le si#pl &ecause a contract has &een

&reached' .he are recovera&le onl i! the de!endant acted !raudulentl

or in &ad !aith or in wanton disregard o! his contractual o&ligations' .he

&reach #ust &e wanton, recless, #alicious or in &ad !aith, and

oppressive or a&usive' Liewise, a &reach o! contract #a give rise to

e*e#plar da#ages onl i! the guilt part acted in a wanton,

!raudulent, recless, oppressive or #alevolent #anner'

Carlos &im, et al. v. /evelopment 4an# of the )hilippines,/'' o'17700, Jul 1, 2013'

a#ages% #oral da#ages% awarded where the victi# o! a cri#e su!!ered

a violent death, even in the a&sence o! proo! o! #ental and e#otional

su!!ering o! the victi#9s heirs' .he "upre#e Court sustained the .C9s

award !or #oral da#ages in the a#ount o! P0,000'00 even in the

a&sence o! proo! o! #ental and e#otional su!!ering o! the victi#9s heirs'

As &orne out & hu#an nature and e*perience, a violent death invaria&land necessaril &rings a&out e#otional pain and anguish on the part o!

the victi#9s !a#il' >hile no a#ount o! da#ages #a totall

co#pensate the sudden and tragic loss o! a loved one it is nonetheless

awarded to the heirs o! the deceased to at least assuage the#')eople of


14/33

the )hilippines v. 0arry 3ergara y 5riel and $oseph Incencio y )aulino,

/'' o' 177753, Jul 3, 2013

a#ages% #oral and e*e#plar da#ages in clai#s !or disa&ilit

&ene!its% not recovera&le where e#ploer was not negligent in a!!ordingthe e#ploee with #edical treat#ent, and e#ploer did not !orsae

e#ploee during the period o! disa&ilit' .he CA correctl denied an

award o! #oral and e*e#plar da#ages' .he respondents were not

negligent in a!!ording the petitioner with #edical treat#ent neither did

the !orsae hi# during his period o! disa&ilit' Camilo A. Esguerra v.

1nited )hilippines &ines, Inc., et al.,/'' o' 144432, Jul 3, 2013'

Hu#an elations% a&use o! rights% Article 14 o! the Civil Code% concept%

da#ages as relie!s' .he principle o! a&use o! rights as enshrined in

Article 14 o! the Civil Code provides that ever person #ust, in the

e*ercise o! his rights and in the per!or#ance o! his duties, act with

ustice, give everone his due, and o&serve honest and good !aith'

(n this regard, the Court9s ruling in !uchengco v. %he anila Chronicle

)u'lishing Corporation is instructive, to wit$

****

.his provision o! law sets standards which #ust &e o&served in the

e*ercise o! one9s rights as well as in the per!or#ance o! its duties, to wit$

to act with ustice% give everone his due% and o&serve honest and good

!aith'

(n 0lo'e ac#ay Ca'le and Radio Corporation v. Court of Appeals, it

was elucidated that while Article 14 )las down a rule o! conduct !or the

govern#ent o! hu#an relations and !or the #aintenance o! social order,

it does not provide a re#ed !or its violation' /enerall, an action !or

da#ages under either Article 20 or Article 21 would &e proper'+ .he

Court said$


15/33

8ne o! the #ore nota&le innovations o! the ew Civil Code is the

codi!ication o! )so#e &asic principles that are to &e o&served !or the

right!ul relationship &etween hu#an &eings and !or the sta&ilit o! the

social order'+ :EP8. 8 .HE C8E C8GG(""(8 8 .HE

P8P8"E C(N(L C8E 8I .HE PH(L(PP(E", p' 34;' .he !ra#erso! the Code, seeing to re#ed the de!ect o! the old Code which #erel

stated the e!!ects o! the law, &ut !ailed to draw out its spirit, incorporated

certain !unda#ental precepts which were )designed to indicate certain

nor#s that spring !ro# the !ountain o! good conscience+ and which were

also #eant to serve as )guides !or hu#an conduct :that; should run as

golden threads through societ, to the end that law #a approach its

supre#e ideal, which is the swa and do#inance o! ustice'+ *Id.

Iore#ost a#ong these principles is that pronounced in Article 14 * * *'

****

.his article, nown to contain what is co##onl re!erred to as the

principle o! a&use o! rights, sets certain standards which #ust &e

o&served not onl in the e*ercise o! one9s rights, &ut also in the

per!or#ance o! one9s duties' .hese standards are the !ollowing$ to act

with ustice% to give everone his due% and to o&serve honest and good

!aith' .he law, there!ore, recogni=es a pri#ordial li#itation on all rights%that in their e*ercise, the nor#s o! hu#an conduct set !orth in Article 14

#ust &e o&served' A right, though & itsel! legal &ecause recogni=ed or

granted & law as such, #a nevertheless &eco#e the source o! so#e

illegalit' >hen a right is e*ercised in a #anner which does not con!or#

with the nor#s enshrined in Article 14 and results in da#age to another,

a legal wrong is there& co##itted !or which the wrongdoer #ust &e

held responsi&le' ?ut while Article 14 las down a rule o! conduct !or

the govern#ent o! hu#an relations and !or the #aintenance o! socialorder, it does not provide a re#ed !or its violation' /enerall, an action

!or da#ages under either Article 20 or Article 21 would &e proper'

$oyce 3. Ardiente v. Spouses $avier and a. %heresa )astofide,/''

o' 151421, Jul 17, 2013'


16/33

Hu#an elations% civil case !or !raud% Article 33 o! the Civil Code

provides that a civil case !or da#ages &ased on !raud #a proceed

independentl o! the cri#inal case there!or% said civil case will not

operate as a preudicial 6uestion that will usti! the suspension o! a

cri#inal case' (t is well settled that a civil action &ased on de!a#ation,!raud and phsical inuries #a &e independentl instituted pursuant to

Article 33 o! the Civil Code, and does not operate as a preudicial

6uestion that will usti! the suspension o! a cri#inal case' .his was

precisel the Court9s thrust in /'' o' 1143, thus$

Goreover, neither is there a preudicial 6uestion i! the civil and the

cri#inal action can, according to law, proceed independentl o! each

other' Fnder ule 111, "ection 3 o! the evised ules on Cri#inalProcedure, in the cases provided in Articles 32, 33, 3 and 2175 o! the

Civil Code, the independent civil action #a &e &rought & the o!!ended

part' (t shall proceed independentl o! the cri#inal action and shall

re6uire onl a preponderance o! evidence' (n no case, however, #a the

o!!ended part recover da#ages twice !or the sa#e act or o#ission

charged in the cri#inal action'

(n the instant case, Civil Case o' 44-431, !or a#ages and

Attach#ent on account o! the alleged !raud co##itted & respondentand his #other in selling the disputed lot to P?( is an independent civil

action under Article 33 o! the Civil Code' As such, it will not operate as

a preudicial 6uestion that will usti! the suspension o! the cri#inal case

at &ar'Rafael $ose Consing, $r. v. )eople of the )hilippines,/'' o'

15107, Jul 1, 2013'

Letter o! credit% de!inition% nature' A letter o! credit is a !inancial device

developed & #erchants as a convenient and relativel sa!e #ode o!dealing with sales o! goods to satis! the see#ingl irreconcila&le

interests o! a seller, who re!uses to part with his goods &e!ore he is paid,

and a &uer, who wants to have control o! his goods &e!ore paing'

However, letters o! credit are e#ploed & the parties desiring to enter

into co##ercial transactions, not !or the &ene!it o! the issuing &an &ut


17/33

#ainl !or the &ene!it o! the parties to the original transaction, in these

cases, ichi#en Corporation as the seller and Fniversal Gotors as the

&uer' Hence, the latter, as the &uer o! the issan C parts, should &e

regarded as the person entitled to deliver o! the goods' Accordingl, !or

purposes o! reconing when notice o! loss or da#age should &e given tothe carrier or its agent, the date o! deliver to Fniversal Gotors is

controlling'Asian %erminals, Inc. v. )hilam Insurance Co., Inc. *no+

Chartis )hilippines Insurance Inc.- )hilam Insurance Co., Inc. *no+

Chartis )hilippines Insurance Inc. v. West+ind Shipping Corporation

and Asian %erminals, Inc.- West+ind Shipping Corporation v. )hilam

Insurance Co., Inc. and Asian %erminals, Inc.,/'' os'

11153B11252B11314, Jul 2, 2013'

Gortgage% includes all natural or civil !ruits and i#prove#ents !ound on

the #ortgaged propert when the secured o&ligation &eco#es due% in

case o! non-pa#ent o! the secured de&t, !oreclosure proceedings shall

cover not onl the hpothecated propert &ut all its accessions and

accessories as well% indispensa&le re6uisite that #ortgagor &e the

a&solute owner o! the encu#&ered propert' ent, as an accessor,

!ollows the principal' (n !act, when the principal propert is #ortgaged,

the #ortgage shall include all natural or civil !ruits and i#prove#ents

!ound thereon when the secured o&ligation &eco#es due as provided in

Article 2127 o! the Civil Code, vi"6

Art' 2127' .he #ortgage e*tends to the natural accessions, to the

i#prove#ents, growing !ruits, and the rents or inco#e not et received

when the o&ligation &eco#es due, and to the a#ount o! the inde#nit

granted or owing to the proprietor !ro# the insurers o! the propert

#ortgaged, or in virtue o! e*propriation !or pu&lic use, with the

declarations, a#pli!ications and li#itations esta&lished & law, whetherthe estate re#ains in the possession o! the #ortgagor, or it passes into

the hands o! a third person'

Conse6uentl, in case o! non-pa#ent o! the secured de&t, !oreclosure

proceedings shall cover not onl the hpothecated propert &ut all its


18/33

accessions and accessories as well' .his was illustrated in the earl case

o! Cu 1n7ieng e Hi7os v. a'alacat Sugar Co. where the Court held$

.hat a #ortgage constituted on a sugar central includes not onl the land

on which it is &uilt &ut also the &uildings, #achiner, and accessoriesinstalled at the ti#e the #ortgage was constituted as well as the

&uildings, #achiner and accessories &elonging to the #ortgagor,

installed a!ter the constitution thereo! * * * :';

Appling such pronounce#ent in the su&se6uent case o! Spouses

)aderes v. Court of Appeals, the Court declared that the i#prove#ents

constructed & the #ortgagor on the su&ect lot are covered & the real

estate #ortgage contract with the #ortgagee &an and thus included inthe !oreclosure proceedings instituted & the latter'

However, the rule is not without 6uali!ications' (n Castro, $r. v. CA the

Court e*plained that Article 2127 is predicated on the presu#ption that

the ownership o! accessions and accessories also &elongs to the

#ortgagor as the owner o! the principal' A!ter all, it is an indispensa&le

re6uisite o! a valid real estate #ortgage that the #ortgagor &e the

a&solute owner o! the encu#&ered propert')hilippine (ational 4an# v.

Sps. 4ernard and Cresencia ara8on,/''o' 14315, Jul 1, 2013'

Gortgage% #ortgagee in good !aith% right to have #ortgage lien carried

over and annotated on the new certi!icate o! title' .he protection

a!!orded to P? as a #ortgagee in good !aith re!ers to the right to have

its #ortgage lien carried over and annotated on the new certi!icate o!

title issued to "pouses GaraOon as so adudged & the .C' .herea!ter,

to en!orce such lien thru !oreclosure proceedings in case o! non-

pa#ent o! the secured de&t, as P? did so pursue' .he principle,however, is not the singular rule that governs real estate #ortgages and

!oreclosures attended & !raudulent trans!ers to the #ortgagor'

)hilippine (ational 4an# v. Sps. 4ernard and Cresencia ara8on,

/''o' 14315, Jul 1, 2013'


19/33

8&ligations% conditions% !ul!ill#ent thereo!% dee#ed !ul!illed when

o&ligor voluntaril prevents it !ul!ill#ent% re6uisites' .he spouses

?onrostro want to &e relieved !ro# paing interest on the a#ount o!

P21,42'52 which the spouses Luna paid to ?liss as a#orti=ations &

asserting that the were prevented & the latter !ro# !ul!illing sucho&ligation' .he invoe Art' 115 o! the Civil Code which provides that

)the condition shall &e dee#ed !ul!illed when the o'ligor voluntaril

prevents its !ul!ill#ent'+

However, the Court !inds Art' 115 inapplica&le to this case' .he said

provision e*plicitl speas o! a situation where it is the o&ligor who

voluntaril prevents !ul!ill#ent o! the condition' Here, Constancia is not

the o&ligor &ut the o&ligee' Goreover, even i! this signi!icant detail is to&e ignored, the #ere intention to prevent the happening o! the condition

or the #ere placing o! ine!!ective o&stacles to its co#pliance, without

actuall preventing !ul!ill#ent is not su!!icient !or the application o! Art'

115' .wo re6uisites #ust concur !or its application, to wit$ @1 intent to

prevent !ul!ill#ent o! the condition% and, @2 actual prevention o!

co#pliance' Sps. (ameal and &ourdes 4onrostro v. Sps. $uan and

Constacia &una, /'' o'17235, Jul 2, 2013'

8&ligations% constructive !ul!ill#ent% Article 115 o! the Civil Code%re6uisites' As aptl pointed out & the CA, Article 115 o! the Civil

Code, which states that )the condition shall &e dee#ed !ul!illed when

the o&ligor voluntaril prevents its !ul!ill#ent,+ does not appl in this

case, vi"6

Article 115 enunciates the doctrine o! constructive !ul!ill#ent o!

suspensive conditions, which applies when the !ollowing three @3

re6uisites concur, vi"6 @1 .he condition is suspensive% @2 .he o&ligoractuall prevents the !ul!ill#ent o! the condition% and @3 He acts

voluntaril' "uspensive condition is one the happening o! which gives

rise to the o&ligation' (t will &e irrational !or an ?an to provide a

suspensive condition in the Pro#issor ote or the estructuring
http://sc.judiciary.gov.ph/jurisprudence/2013/july2013/172346.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/172346.pdf


20/33

Agree#ent that will allow the de&tor-pro#issor to &e !reed !ro# the

dut to pa the loan without paing it'

Carlos &im, et al. v. /evelopment 4an# of the )hilippines,/'' o'

17700, Jul 1, 2013'

8&ligations% i! an o&ligation consists o! pa#ent o! #one, and the

de&tor incurs in dela, the inde#nit !or da#ages, there &eing no

stipulation to the contrar, shall &e the pa#ent o! the interest agreed

upon, and in the a&sence o! stipulation, the legal interest' Fnder Article

2204 o!the Civil Code, ):i;!the o&ligation consists in the pa#ent o! a

su# o! #one, and the de&tor incurs in dela, the inde#nit !orda#ages, there &eing no stipulation to the contrar, shall &e the pa#ent

o! the interest agreed upon, and in the a&sence o! stipulation, the legal

interest * * *'+ .here &eing no stipulation on interest in case o!dela in

the pa#ent o!a#orti=ation, the CA thus correctl i#posed interest at

the legal rate which is now 12Mper annum. Sps. (ameal and &ourdes

4onrostro v. Sps. $uan and Constacia &una, /'' o'17235, Jul 2,

2013'

Penalties and interest rates% penalties and interest rates should &ee*pressl stipulated in writing' As to the i#position o! additional interest

and penalties not stipulated in the Pro#issor otes, this should not &e

allowed' Article 145 o! the Civil Code speci!icall states that )no

interest shall &e due unless it has &een e*pressl stipulated in writing'+

.hus, the pa#ent o! interest and penalties in loans is allowed onl i!

the parties agreed to it and reduced their agree#ent in writing' Carlos

&im, et al. v. /evelopment 4an# of the )hilippines,/'' o' 17700,

Jul 1, 2013'

Prescription% Article 11 o! the Civil Code' >e concur with the CA9s

ruling that respondent9s action did not et prescri&e' .he legal provision

governing this case was not Article 115 o! the Civil Code,&ut Article

11 o! the Civil Code, which states$
http://sc.judiciary.gov.ph/jurisprudence/2013/july2013/177050.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/177050.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/172346.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/172346.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/177050.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/177050.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/177050.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/177050.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/172346.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/172346.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/177050.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/177050.pdf


21/33

Article 11' .he !ollowing actions #ust &e &rought within ten ears

!ro# the ti#e the cause o! action accrues$

@1Fpon a written contract% @2 Fpon an o&ligation created & law%

@3Fpon a udg#ent'

3ector Shipping Corporation, et al. v. American Home Assurance Co.,

et al., /'' o' 14213, Jul 3, 2013'

Propert% co-ownership% sale o! co-owned propert% i! onl one co-

owner agreed to the sale, said co-owner onl sold his ali6uot share in the

su&ect propert' ?ut as held & the appellate court, the sale &etween the

petitioner and Aleandro is valid inso!ar as the ali9uot share o!

respondent Aleandro is concerned' ?eing a co-owner, Aleandro can

validl and legall dispose o! his share even without the consent o! all

the other co-heirs' "ince the &alance o! the !ull price has not et &een

paid, the a#ount paid shall represent as pa#ent to his ali9uot share'

.his then leaves the sale o! the lot o! the Alta#iranos to the "pouses

Laarca valid onl inso!ar as their shares are concerned, e*clusive o! the

ali9uotpart o! Aleandro, as ruled & the CA'Reman Recio v. Heirs of

Spouses Aguego and aria Altamirano, /'' o'1234, Jul 2, 2013'

Propert% patri#onial propert and propert o! pu&lic do#inion%

patri#onial propert o! the "tate #a &e the o&ect o! prescription,

however, those intended !or so#e pu&lic service or the develop#ent o!

national wealth are propert o! pu&lic do#inion, which are not

suscepti&le to ac6uisition & prescription% pu&lic do#ain lands &eco#e

patri#onial propert onl i! there is a declaration that these are aliena&le

or disposa&le, together with an e*press govern#ent #ani!estation that

the propert is alread patri#onial or no longer retained !or pu&licservice or the develop#ent o! national wealth' Fnder Article 22 o! the

Civil Code, pu&lic do#ain lands &eco#e patri#onial propert onl i!

there is a declaration that these are aliena&le or disposa&le, together with

an e*press govern#ent #ani!estation that the propert is alread

patri#onial or no longer retained !or pu&lic service or the develop#ent


22/33

o! national wealth' 8nl when the propert has &eco#e patri#onial can

the prescriptive period !or the ac6uisition o! propert o! the pu&lic

do#inion &egin to run' Also under "ection 1@2 o! Presidential ecree

@P'' o' 124, it is provided that &e!ore ac6uisitive prescription can

co##ence, the propert sought to &e registered #ust not onl &eclassi!ied as aliena&le and disposa&le, it #ust also &e e*pressl declared

& the "tate that it is no longer intended !or pu&lic service or the

develop#ent o! the national wealth, or that the propert has &een

converted into patri#onial' A&sent such an e*press declaration & the

"tate, the land re#ains to &e propert o! pu&lic do#inion'/ream

3illage (eigh'orhood Association, Inc., represented 'y its Incum'ent

)resident 0reg Seriego v. 4ases Conversion /evelopment Authority,

/'' o'14245, Jul 2, 2013'

ent% civil !ruit% right!ul recipient' ent is a civil !ruit that &elongs to the

owner o! the propert producing it & right o! accession' .he right!ul

recipient o! the disputed rent in this case should thus &e the owner o! the

su&ect lot at the ti#e the rent accrued')hilippine (ational 4an# v. Sps.

4ernard and Cresencia ara8on, /''o' 14315, Jul 1, 2013'

"u&rogation% &asis% de!inition' Consistent with the pertinent law and

urisprudence, there!ore, E*hi&it ( was alread enough & itsel! to provethe pa#ent o! P7,,21'00 as the !ull settle#ent o! Calte*9s clai#'

.he pa#ent #ade to Calte* as the insured &eing there& dul

docu#ented, respondent &eca#e su&rogated as a #atter o! course

pursuant to Article 2207 o! the Civil Code. (n legal conte#plation,

su&rogation is the )su&stitution o! another person in the place o! the

creditor, to whose rights he succeeds in relation to the de&t%+ and is

)independent o! an #ere contractual relations &etween the parties to &e

a!!ected & it, and is &road enough to cover ever instance in which onepart is re6uired to pa a de&t !or which another is pri#aril answera&le,

and which in e6uit and conscience ought to &e discharged & the

latter'+ 3ector Shipping Corporation, et al. v. American Home

Assurance Co., et al., /'' o' 14213, Jul 3, 2013'


23/33

"u&rogation in insurance cases% accrues si#pl upon pa#ent & the

insurance co#pan o! the insurance clai#% pa#ent & the insurer to the

insured operates as an e6uita&le assign#ent to the insurer o! all re#edies

that the insured #a have against the third part whose negligence or

wrong!ul act caused the loss' .he Court holds that petitioner Phila# hasade6uatel esta&lished the &asis o! its clai# against petitioners A.( and

>estwind' Phila#, as insurer, was su&rogated to the rights o! the

consignee, Fniversal Gotors Corporation, pursuant to the "u&rogation

eceipt e*ecuted & the latter in !avor o! the !or#er' .he right o!

su&rogation accrues si#pl upon pa#ent & the insurance co#pan o!

the insurance clai#' Petitioner Phila#9s action !inds support in Article

2207 o! the Civil Code, which provides as !ollows$

Art' 2207' (! the plainti!!9s propert has &een insured, and he has

received inde#nit !ro# the insurance co#pan !or the inur or loss

arising out o! the wrong or &reach o! contract co#plained o!, the

insurance co#pan shall &e su&rogated to the rights o! the insured

against the wrongdoer or the person who has violated the contract' * * *'

estwind !ailed to o!!er an evidence to controvert the sa#e'

(n Galaan (nsurance Co', (nc' v' Al&erto, the Court e*plained the e!!ect

o! pa#ent & the insurer o! the insurance clai# in this wise$

>e have held that pa#ent & the insurer to the insured operates as an

e6uita&le assign#ent to the insurer o! all the re#edies that the insured

#a have against the third part whose negligence or wrong!ul act

caused the loss' .he right o! su&rogation is not dependent upon, nor doesit grow out o!, an privit o! contract' (t accrues si#pl upon pa#ent

& the insurance co#pan o! the insurance clai#' .he doctrine o!

su&rogation has its roots in e6uit' (t is designed to pro#ote and

acco#plish ustice% and is the #ode that e6uit adopts to co#pel the

ulti#ate pa#ent o! a de&t & one who, in ustice, e6uit, and good


24/33

conscience, ought to pa'Asian %erminals, Inc. v. )hilam Insurance

Co., Inc. *no+ Chartis )hilippines Insurance Inc.- )hilam Insurance

Co., Inc. *no+ Chartis )hilippines Insurance Inc. v. West+ind Shipping

Corporation and Asian %erminals, Inc.- West+ind Shipping Corporation

v. )hilam Insurance Co., Inc. and Asian %erminals, Inc.,/'' os'11153B11252B11314, Jul 2, 2013'

.ender o! pa#ent% concept% tender o! pa#ent, i! re!used without ust

cause, will discharge the de&tor onl a!ter a valid consignation with the

court% when tender o! pa#ent is not acco#panied & the #eans o!

pa#ent, and the de&tor did not tae an i##ediate step to #ae a

consignation, then interest is not suspended !ro# the ti#e o! such tender'

.ender o! pa#ent )is the #ani!estation & the de&tor o! a desire toco#pl with or pa an o&ligation' (! re!used without ust cause, the

tender o! pa#ent will discharge the de&tor o! the o&ligation to pa &ut

onl a!ter a valid consignation o! the su# due shall have &een #ade with

the proper court'+ )Consignation is the deposit o! the :proper a#ount

with a udicial authorit; in accordance with rules prescri&ed & law,

a!ter the tender o! pa#ent has &een re!used or &ecause o! circu#stances

which render direct pa#ent to the creditor i#possi&le or inadvisa&le'+

).ender o! pa#ent, without #ore, produces no e!!ect'+ ):.;o have thee!!ect o! pa#ent and the conse6uent e*tinguish#ent o! the o&ligation

to pa, the law re6uires the co#panion acts o! tender o! pa#ent and

consignation'+

As to the e!!ect o! tender o! pa#ent on interest, noted civilist Arturo G'

.olentino e*plained as !ollows$

>hen a tender o! pa#ent is #ade in such a !or# that the creditor couldhave i##ediatel reali=ed pa#ent i! he had accepted the tender,

!ollowed & a pro#pt atte#pt o! the de&tor to deposit the #eans o!

pa#ent in court & wa o! consignation, the accrual o! interest on the

o&ligation will &e suspended !ro# the date o! such tender' 'ut when the

tender of payment is not accompanied &y the means of payment!


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and the de&tor did not ta%e any immediate step to ma%e a

consignation! then interest is not suspended from the time of such

tender# * * * * @E#phasis supplied Sps. (ameal and &ourdes

4onrostro v. Sps. $uan and Constacia &una, /'' o'17235, Jul 2,

2013'

Special Laws

Act o' 313% !oreclosure sale% personal notice to the #ortgagor in

e*traudicial !oreclosure proceedings is necessar where there is a

stipulation to this e!!ect, and !ailure to co#pl with the stipulated notice

re6uire#ent is a contractual &reach su!!icient to render the !oreclosure

sale null and void' (t has &een consistentl held that unless the partiesstipulate, )personal notice to the #ortgagor in e*traudicial !oreclosure

proceedings is not necessar+ &ecause "ection 3117 o! Act 313 onl

re6uires the posting o! the notice o! sale in three pu&lic places and the

pu&lication o! that notice in a newspaper o! general circulation'

(n this case, the parties stipulated in paragraph 11 o! the Gortgage that$

11' All correspondence relative to this #ortgage, including de#and

letters, su##ons, su&poenas, or noti!ication o! an udicial or e*tra-udicial action shall &e sent to the Gortgagor at *** or at the address that

#a herea!ter &e given in writing & the Gortgagor or the Gortgagee%

However, no notice o! the e*traudicial !oreclosure was sent & ?P to

petitioners a&out the !oreclosure sale scheduled on Jul 11, 144' .he

letters dated Januar 2, 144 and Garch 11, 144 advising petitioners

to i##ediatel pa their o&ligation to avoid the i#pending !oreclosure

o! their #ortgaged properties are not the notices re6uired in paragraph

11 o! the Gortgage' .he !ailure o! ?P to co#pl with their contractual

agree#ent with petitioners, i'e', to send notice, is a &reach su!!icient to

invalidate the !oreclosure sale' Carlos &im, et al. v. /evelopment 4an#

of the )hilippines,/'' o' 17700, Jul 1, 2013'


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?ases Conversion evelop#ent Authorit @?CA% ?CA holds title to

Iort ?oni!acio% rea# Nillage sits on the a&andoned C- oad, which

lies outside the areas declared in Procla#ation os' 275 and 172 as

aliena&le and disposa&le' .hat the ?CA has title to Iort ?oni!acio has

long &een decided with !inalit' (n Samahan ng asang )ilipino saa#ati, Inc. v. 4C/A, it was categoricall ruled as !ollows$

Iirst, it is une6uivocal that the Philippine /overn#ent, and now the

?CA, has title and ownership over Iort ?oni!acio' .he case o!Acting

Registrars of &and %itles and /eeds of )asay City, )asig and a#ati is

!inal and conclusive on the ownership o! the thenHacienda de

Garica&an estate & the epu&lic o! the Philippines' Clearl, the issue

on the ownership o! the su&ect lands in Iort ?oni!acio is laid to rest'8ther than their view that the F"A is still the owner o! the su&ect lots,

petitioner has not put !orward an clai# o! ownership or interest in

the#'/ream 3illage (eigh'orhood Association, Inc., represented 'y its

Incum'ent )resident 0reg Seriego v. 4ases Conversion /evelopment

Authority, /'' o'14245, Jul 2, 2013'

Co##on Carrier% Carriage o! /oods & "ea Act @C8/"A% prescriptive

period !or !iling an action !or loss or da#age o! goods' .he prescriptive

period !or !iling an action !or the loss or da#age o! the goods under theC8/"A is !ound in paragraph @5, "ection 3, thus$

@5 Fnless notice o! loss or da#age and the general nature o! such loss

or da#age &e given in writing to the carrier or his agent at the port o!

discharge &e!ore or at the ti#e o! the re#oval o! the goods into the

custod o! the person entitled to deliver thereo! under the contract o!

carriage, such re#oval shall &e pri#a !acie evidence o! the deliver &

the carrier o! the goods as descri&ed in the &ill o! lading' (! the loss orda#age is not apparent, the notice #ust &e given within three das o! the

deliver' "aid notice o! loss or da#age #a&e endorsed upon the receipt

!or the goods given & the person taing deliver thereo!' .he notice in

writing need not &e given i! the state o! the goods has at the ti#e o! their

receipt &een the su&ect o! oint surve or inspection'
http://sc.judiciary.gov.ph/jurisprudence/2013/july2013/192896.pdfhttp://sc.judiciary.gov.ph/jurisprudence/2013/july2013/192896.pdf


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(n an event the carrier and the ship shall &e discharged !ro# all lia&ilit

in respect o! loss or da#age unless suit is &rought within one ear a!ter

deliver o! the goods or the date when the goods should have &een

delivered$ Provided, .hat i! a notice o! loss or da#age, either apparent

or concealed, is not given as provided !or in this section, that !act shallnot a!!ect or preudice the right o! the shipper to &ring suit within one

ear a!ter the deliver o! the goods or the date when the goods should

have &een delivered'Asian %erminals, Inc. v. )hilam Insurance Co., Inc.

*no+ Chartis )hilippines Insurance Inc.- )hilam Insurance Co., Inc.

*no+ Chartis )hilippines Insurance Inc. v. West+ind Shipping


v. )hilam Insurance Co., Inc. and Asian %erminals, Inc.,/'' os'

11153B11252B11314, Jul 2, 2013'

Co##on Carrier% Carriage o! /oods & "ea Act @C8/"A% prescriptive

period !or !iling an action !or loss or da#age o! goods' .he prescriptive

period !or !iling an action !or the loss or da#age o! the goods under the

C8/"A is !ound in paragraph @5, "ection 3, thus$

@5 Fnless notice o! loss or da#age and the general nature o! such loss

or da#age &e given in writing to the carrier or his agent at the port o!

discharge &e!ore or at the ti#e o! the re#oval o! the goods into thecustod o! the person entitled to deliver thereo! under the contract o!

carriage, such re#oval shall &e pri#a !acie evidence o! the deliver &

the carrier o! the goods as descri&ed in the &ill o! lading' (! the loss or

da#age is not apparent, the notice #ust &e given within three das o! the

deliver' "aid notice o! loss or da#age #a&e endorsed upon the receipt

!or the goods given & the person taing deliver thereo!' .he notice in

writing need not &e given i! the state o! the goods has at the ti#e o! their

receipt &een the su&ect o! oint surve or inspection'

(n an event the carrier and the ship shall &e discharged !ro# all lia&ilit

in respect o! loss or da#age unless suit is &rought within one ear a!ter

deliver o! the goods or the date when the goods should have &een

delivered$ Provided, .hat i! a notice o! loss or da#age, either apparent


28/33

or concealed, is not given as provided !or in this section, that !act shall

not a!!ect or preudice the right o! the shipper to &ring suit within one

ear a!ter the deliver o! the goods or the date when the goods should

have &een delivered'Asian %erminals, Inc. v. )hilam Insurance Co., Inc.

*no+ Chartis )hilippines Insurance Inc.- )hilam Insurance Co., Inc.*no+ Chartis )hilippines Insurance Inc. v. West+ind Shipping


v. )hilam Insurance Co., Inc. and Asian %erminals, Inc.,/'' os'

11153B11252B11314, Jul 2, 2013'

Ia#il Code% #arriage% void a& initio !or lac o! a #arriage license% no

inconsistenc in !inding the #arriage null and void a& initio and, at the

sa#e ti#e, non-e*istent% contracts which are a&solutel si#ulated or!ictitious are ine*istent and void !ro# the &eginning' .here is no

inconsistenc in !inding the #arriage &etween ?ena#in and "all null

and void a' initio and, at the sa#e ti#e, non-e*istent' Fnder Article 3

o! the Ia#il Code, a #arriage sole#ni=ed without a license, e*cept

those covered & Article 3 where no license is necessar, )shall &e void

!ro# the &eginning'+ (n this case, the #arriage &etween ?ena#in and

"all was sole#ni=ed without a license' (t was dul esta&lished that no

#arriage license was issued to the# and that Garriage License o' -

075 did not #atch the #arriage license nu#&ers issued & the local

civil registrar o! Pasig Cit !or the #onth o! Ie&ruar 142' .he case

clearl !alls under "ection 3 o! Article 320 which #ade their #arriage

void a' initio. .he #arriage &etween ?ena#in and "all was also non-

e*istent' Appling the general rules on void or ine*istent contracts under

Article 104 o! the Civil Code, contracts which are a&solutel si#ulated

or !ictitious are )ine*istent and void !ro# the &eginning'+ .hus, the

Court o! Appeals did not err in sustaining the trial court9s ruling that the

#arriage &etween ?ena#in and "all was null and void a' initio andnon-e*istent' Sally 0o:4angayan v. 4en7amin 4angayan, $r., /'' o'

201051, Jul 3, 2013'

Ia#il Code% #arriage license% certi!ication !ro# the local civil registrar

is ade6uate to prove the non-issuance o! a #arriage license and, a&sent


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an suspicious circu#stance, the certi!ication enos pro&ative value'

.he certi!ication !ro# the local civil registrar is ade6uate to prove the

non-issuance o! a #arriage license and a&sent an suspicious

circu#stance, the certi!ication enos pro&ative value, &eing issued &

the o!!icer charged under the law to eep a record o! all data relative tothe issuance o! a #arriage license' Sally 0o:4angayan v. 4en7amin

4angayan, $r., /'' o' 201051, Jul 3, 2013'

Ia#il Code% propert relations in cases o! coha&itation without the

&ene!it o! #arriage% rules' .he Court o! Appeals correctl ruled that the

propert relations o! ?ena#in and "all is governed & Article 1 o!

the Ia#il Code which states$

Art' 1' (n cases o! coha&itation not !alling under the preceding Article,

onl the properties ac6uired & &oth o! the parties through their actual

oint contri&ution o! #one, propert, or industr shall &e owned &

the# in co##on in proportion to their respective contri&utions' (n the

a&sence o! proo! to the contrar, their contri&utions and corresponding

shares are presu#ed to &e e6ual' .he sa#e rule and presu#ption shall

appl to oint deposits o! #one and evidences o! credit'

(! one o! the parties is validl #arried to another, his or her share in theco-ownership shall accrue to the a&solute co##unit o! conugal

partnership e*isting in such valid #arriage' (! the part who acted in &ad

!aith is not validl #arried to another, his or her share shall &e !or!eited

in the #anner provided in the last paragraph o! the preceding Article'

.he !oregoing rules on !or!eiture shall liewise appl even i! &oth

parties are in &ad !aith'

?ena#in and "all coha&itated without the &ene!it o! #arriage' .hus,

onl the properties ac6uired & the# through their actual oint

contri&ution o! #one, propert, or industr shall &e owned & the# in

co##on in proportion to their respective contri&utions' Sally 0o:

4angayan v. 4en7amin 4angayan, $r., /'' o' 201051, Jul 3, 2013'


30/33

Land ownership% decree o! registration !or which an 8C. was issued is

accorded greater weight as against ta* declarations and ta* receipts in

the na#e o! another% ta* declarations and ta* receipts onl &eco#e the

&asis o! a clai# o! ownership when coupled with proo! o! actual

possession o! propert' (n the case o!errer:&ope" v. CA, the Courtruled that as against an arra o! proo!s consisting o! ta* declarations

andBor ta* receipts which are not conclusive evidence o! ownership nor

proo! o! the area covered therein, an original certi!icate o! title, which

indicates true and legal ownership & the registered owners over the

disputed pre#ises, #ust prevail' Accordingl, respondents9 ecree o'

4442 !or which an original certi!icate o! title was issued should &e

accorded greater weight as against the ta* declarations and ta* receipts

presented & petitioners in this case' ?esides, ta* declarations and ta*receipts #a onl &eco#e the &asis o! a clai# !or ownership when the

are coupled with proo! o! actual possession o! the propert'Heirs of

Ale7andra /elfin, namely, &eopoldo /elfin, et al. v. Avelina Ra'adon,

/'' o' 1501, Jul 31, 2013'

Land registration% decree o! registration &ars all clai#s and rights which

arose or #a have e*isted prior to the decree o! registration' (t is an

ele#ental rule that a decree o! registration &ars all clai#s and rights

which arose or #a have e*isted prior to the decree o! registration' ?

the issuance o! the decree, the land is &ound and title thereto 6uieted,

su&ect onl to certain e*ceptions under the propert registration decree'

Heirs of Ale7andra /elfin, namely, &eopoldo /elfin, et al. v. Avelina

Ra'adon, /'' o' 1501, Jul 31, 2013'

epu&lic Act o' 25% reconstitution o! title% nature o! proceeding%

.orrens sste#% sources o! reconstitution% #andator re6uire#ents o!

pu&lication, posting, and notice' At the outset, the Court notes that thepresent a#ended petition !or reconstitution is anchored on the owner9s

duplicate cop o! .C. o' 20 a source !or reconstitution o! title

under "ection 3@a24 o! A 25 which, in turn, is governed & the

provisions o! "ection 10 in relation to "ection 4 o! A 25 with respect to

the pu&lication, posting, and notice re6uire#ents' "ection 10 reads$


31/33

"EC' 10' othing herein&e!ore provided shall prevent an registered

owner or person in interest !ro# !iling the petition #entioned in section

!ive o! this Act directl with the proper Court o! Iirst (nstance, &ased on

sources enu#erated in sections 2@a, 2@&, 3@a, 3@&, andBor @a o! this

Act$ Provided, however, .hat the court shall cause a notice o! thepetition, &e!ore hearing and granting the sa#e, to &e pu&lished in the

#anner stated in section nine hereo!$ And, provided, !urther, .hat

certi!icates o! title reconstituted pursuant to this section shall not &e

su&ect to the encu#&rance re!erred to in section seven o! this Act'

Corollaril, "ection 4 reads in part$

"EC' 4' * * * .hereupon, the court shall cause a notice o! the petition to&e pu&lished, at the e*pense o! the petitioner, twice in successive issues

o! the 8!!icial /a=ette, and to &e posted on the #ain entrance o! the

provincial &uilding and o! the #unicipal &uilding o! the #unicipalit or

cit in which the land lies, at least thirt das prior to the date o!

hearing, and a!ter hearing, shall deter#ine the petition and render such

udg#ent as ustice and e6uit #a re6uire' * * *'

.he !oregoing provisions, there!ore, clearl re6uire that @a notice o! the

petition should &e pu&lished in two @2 successive issues o! the 8!!icial/a=ette% and @& pu&lication should &e #ade at least thirt @30 das

prior to the date o! hearing' "u&stantial co#pliance with this

urisdictional re6uire#ent is not enough% it &ears stressing that the

ac6uisition o! urisdiction over a reconstitution case is hinged on a strict

co#pliance with the re6uire#ents o! the law'Repu'lic of the

)hilippines v. Ricordito (. /e Asis, $r.,/'' o' 1437, Jul 2, 2013'

.orrens sste#% the issue on the validit o! title necessitates a re#and o!the case' .he Court recogni=es the i#portance o! protecting the

countr9s .orrens sste# !ro# !ae land titles and deeds' Considering

that there is an issue on the validit o! the title o! petitioner N", which

title is alleged to &e tracea&le to (C) *o# ++, registered on -pril 1+!

1+1.! which #other title was held to &e ine*istent inManotok Realty,


32/33

Inc. v. CLT Realty Development Corporation, in the interest o! ustice,

and to sa!eguard the correct titling o! properties, a re#and is proper to

deter#ine which o! the parties derived valid title !ro# the legiti#ate

(C) *o# ++, registered on /ay 3! 1+1.# "ince this Court is not a trier

o! !acts and not capacitated to appreciate evidence o! the !irst instance,the Court #a re#and this case to the Court o! Appeals !or !urther

proceedings, as it has &een si#ilarl tased inManotok Realty, Inc. v.

CLT Realty Development Corporation. 3S/ Realty ; /evelopment

Corporation v. 1ni+ide Sales, Inc. and /olores 4aello %e7ada,/'' o'

170577, Jul 31, 2013

.orrens sste#% .orrens title% lands under a .orrens title cannot &e

ac6uired & prescription or adverse possession' Goreover, it is a settledrule that lands under a .orrens title cannot &e ac6uired & prescription or

adverse possession' "ection 7 o! P'' o' 124, the Propert

egistration ecree, e*pressl provides that no title to registered land in

derogation o! the title o! the registered owner shall &e ac6uired &

prescription or adverse possession' And, although the registered

landowner #a still lose his right to recover the possession o! his

registered propert & reason o! laches, nowhere has rea# Nillage

alleged or proved laches, which has &een de!ined as such neglect or

o#ission to assert a right, taen in conunction with lapse o! ti#e and

other circu#stances causing preudice to an adverse part, as will

operate as a &ar in e6uit' Put an wa, it is a dela in the assertion o! a

right which wors disadvantage to another &ecause o! the ine6uit

!ounded on so#e change in the condition or relations o! the propert or

parties' (t is &ased on pu&lic polic which, !or the peace o! societ,

ordains that relie! will &e denied to a stale de#and which otherwise

could &e a valid clai#'/ream 3illage (eigh'orhood Association, Inc.,

represented 'y its Incum'ent )resident 0reg Seriego v. 4asesConversion /evelopment Authority, /'' o'14245, Jul 2, 2013'

*Rose than#s Earla, rances and Rory for assisting in the preparation of

this post.


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Documents

7 July 2013 Civil Law.doc