1 BIBIANO C. ELEGIR vs. PHILIPPINE AIRLINES, INC.. G.R. No. 181995 July 16, 2012 REYES, J.

: FACTS: Petitioner Bibiano C. Elegir (petitioner) was hired by Philippine Airlines, Inc. (PAL) as a commercial pilot.The petitioner, together with seven (7) other pilots, was sent for training at Boeing in Seattle, Washington, United States of America on May 8, 1995, to acquire the necessary skills and knowledge in handling the new aircraft. He completed his training on September 19, 1995. On November 5, 1996, after rendering twenty-five (25) years, eight (8) months and twenty (20) days of continuous service, the petitioner applied for optional retirement authorized under the Collective Bargaining Agreement (CBA) between PAL and the Airline Pilots Association of the Philippines (ALPAP), in which he was a member of good standing. In response, PAL asked him to reconsider his decision, asseverating that the company has yet to recover the full value of the costs of his training. It warned him that if he leaves PAL before he has rendered service for at least three (3) years, it shall be constrained to deduct the costs of his training from his retirement pay. On November 6, 1996, the petitioner went on terminal leave for thirty (30) days and thereafter made effective his retirement from service. Upon securing his clearance, however, he was informed that the costs of his training will be deducted from his retirement pay, which will be computed at the rate of P 5,000.00 per year of service. The petitioner, through his counsel, sent PAL a correspondence, asserting that his retirement benefits should be based on the computation stated in Article 287 of the Labor Code, as amended by Republic Act (R.A.) No. 7641, and that the costs of his training should not be deducted therefrom. In its Reply dated August 4, 1997, PAL refused to yield to the petitioners demand and maintained that his retirement pay should be based on PAL-ALPAP Retirement Plan of 1967 (PAL-ALPAP Retirement Plan) and that he should reimburse the company with the proportionate costs of his training. Thus, on August 27, 1997, the petitioner filed a complaint for non-payment of retirement pay, moral damages, exemplary damages and attorneys fees against PAL. PAL invested for the training of Almario to enable him to acquire a higher level of skill, proficiency, or technical competence so that he could efficiently discharge the position of A-300 First Officer. Given that, PAL expected to recover the training costs by availing of Almarios services for at least three years. The expectation of PAL was not fully realized, however, due to Almarios resignation after only eight months of service following the completion of his training course. He cannot, therefore, refuse to reimburse the costs of training without violating the principle of unjust enrichment. ISSUE: Whether or not there is unjust enrichment on the part of the petitioner by leaving the company.

RULING: Yes. To allow the petitioner to leave the company before it has fulfilled the reasonable expectation of service on his part will amount to unjust enrichment. Pertinently, Article 22 of the New Civil Code states: Art. 22. Every person who through an act of performance by another, or any other means, acquires or comes into possession of something at the expense of the latter without just or legal ground, shall return the same to him.

There is unjust enrichment when a person unjustly retains a benefit at the loss of another, or when a person retains the money or property of another against the fundamental principles of justice, equity and good conscience. Two conditions must concur: (1) a person is unjustly benefited; and (2) such benefit is derived at the expense of or with damages to another. The main objective of the principle of unjust enrichment is to prevent one from enriching oneself at the expense of another. It is commonly accepted that this doctrine simply means that a person shall not be allowed to profit or enrich himself inequitably at anothers expense. The enrichment may consist of a patrimonial, physical, or moral advantage, so long as it is appreciable in money. It must have a correlative prejudice, disadvantage or injury to the plaintiff which may consist, not only of the loss of the property or the deprivation of its enjoyment, but also of the non-payment of compensation for a prestation or service rendered to the defendant without intent to donate on the part of the plaintiff, or the failure to acquire something what the latter would have obtained. As can be gathered from the facts, PAL invested a considerable amount of money in sending the petitioner abroad to undergo training to prepare him for his new appointment as B747-400 Captain. In the process, the petitioner acquired new knowledge and skills which effectively enriched his technical know-how. As all other investors, PAL expects a return on investment in the form of service by the petitioner for a period of 3 years, which is the estimated length of time within which the costs of the latters training can be fully recovered. The petitioner is, thus, expected to work for PAL and utilize whatever knowledge he had learned from the training for the benefit of the company. However, after only one (1) year of service, the petitioner opted to retire from service, leaving PAL stripped of a necessary manpower.

3 GOVERNMENT SERVICE INSURANCE SYSTEM(GSIS) vs. COMMISSION ON AUDIT (COA) G.R. No. 162372 SEPTEMBER 11, 2012 LEONARDO-DE CASTRO, J.: FACTS: The Movants Federico Pascual, et al. are asking this Court to reconsider our Decision in so far as their liability, as the payees, to return the benefits they had already received others, wherein, despite this Courts disapproval of the allowances and/or benefits the payees therein received, for being contrary to the law applicable in those cases, this Court did not require such payees to refund the monies they had received in good faith. The public respondents, through the Office of the Solicitor General, commented and agreed with the Movants Federico Pascual, et al. that it would be an injustice if they were ordered to refund the retirement benefits they had received more than a decade ago. Furthermore, even if the substantive issues and arguments raised by the Movants Federico Pascual, et al. are considered, there is no justifiable ground to reverse the Courts Decision. While it is true, as claimed by the Movants Federico Pascual, et al., that based on prevailing jurisprudence, disallowed benefits received in good faith need not be refunded, the case before us may be distinguished from all the cases cited by Movants Federico Pascual, et al. because the monies involved here are retirement benefits. ISSUE: Whether or not the disallowed benefits received in good faith amounted to unjust enrichment.

RULING: Unjust enrichment is a term used to depict result or effect of failure to make remuneration of or for property or benefits received under circumstances that give rise to legal or equitable obligation to account for them; to be entitled to remuneration, one must confer benefit by mistake, fraud, coercion, or request. Unjust enrichment is not itself a theory of reconvey. Rather, it is a prerequisite for the enforcement of the doctrine of restitution. The statutory basis for unjust enrichment is found in Article 22 of the Civil Code, which provides: Every person who through an act of performance by another, or any other means, acquires or comes into possession of something at the expense of the latter without just or legal ground, shall return the same to him. Under the foregoing provision, there is unjust enrichment when: 1. A person is unjustly benefited; and 2. Such benefit is derived at the expense of or with damages to another. There is unjust enrichment when a person unjustly retains a benefit to the loss of another, or when a person retains money or property of another against the fundamental principles of justice, equity and good conscience. In the same case, it was added that "there is no unjust enrichment when the person who will benefit has a valid claim to such benefit." Because the GSIS RFP, which we repeat, is contrary to law, thus void and of no effect, the enrichment of the payees is without just or legal ground. Therefore, the payees have no valid claim to the benefits they received under the GSIS RFP.

4 WILLEM BEUMER vs. AVELINA AMORES G.R. No. 195670 December 3, 2012 PERLAS-BERNABE, J.: FACTS: Petitioner, a Dutch National, and respondent, a Filipina, married in March 29, 1980. After several years, the RTC of Negros Oriental, Branch 32, declared the nullity of their marriage in the Decision dated November 10, 2000 on the basis of the formers psychological incapacity as contemplated in Article 36 of the Family Code. Consequently, petitioner filed a Petition for Dissolution of Conjugal Partnership dated December 14, 2000 praying for the distribution of the following described properties claimed to have been acquired during the subsistence of their marriage, to wit: On February 28, 2007, the RTC of Negros Oriental, Branch 34 rendered its Decision, dissolving the parties conjugal partnership, awarding all the parcels of land to respondent as her paraphernal properties; the tools and equipment in favor of petitioner as his exclusive properties; the two (2) houses standing on Lots 1 and 2142 as co-owned by the parties, the dispositive of which reads: The personal properties, i.e., tools and equipment mentioned in the complaint which were brought out by Willem from the conjugal dwelling are hereby declared to be exclusively owned by the petitioner. The two houses standing on the lots covered by Transfer Certificate of Title Nos. 21974 and 22846 are hereby declared to be co-owned by the petitioner and the respondent since these were acquired during their marital union and since there is no prohibition on foreigners from owning buildings and residential units. Petitioner and respondent are, thereby, directed to subject this court for approval their project of partition on the two houses aforementioned. Petitioner elevated the matter to the CA, contesting only the RTCs award of Lots 1, 2142, 5845 and 4 in favor of respondent. He insisted that the money used to purchase the foregoing properties came from his own capital funds and that they were registered in the name of his former wife only because of the constitutional prohibition against foreign ownership. Thus, he prayed for reimbursement of one-half (1/2) of the value of what he had paid in the purchase of the said properties, waiving the other half in favor of his estranged ex-wife.

ISSUE: Whether or not the petitioners claim for reimbursement on the basis of unjust enrichment be granted.

RULING: No. It is well-established that equity as a rule will follow the law and will not permit that to be done indirectly which, because of public policy, cannot be done directly. Surely, a contract that violates the Constitution and the law is null and void, vests no rights, creates no obligations and produces no legal effect at all. Corollary thereto, under Article 1412 of the Civil Code, petitioner cannot have the subject properties deeded to him or allow him to recover the money he had spent for the purchase thereof. The law will not aid either party to an illegal contract or agreement; it leaves the parties where it finds them. Indeed, one cannot salvage any rights from an unconstitutional transaction knowingly entered into. Neither can the Court grant petitioners claim for reimbursement on the basis of unjust enrichment. As held in Frenzel v. Catito, a case also involving a foreigner seeking monetary reimbursement for money spent on purchase of Philippine land, the provision on unjust enrichment does not apply if the action is proscribed by the Constitution.

In any event, the Court cannot, even on the grounds of equity, grant reimbursement to petitioner given that he acquired no right whatsoever over the subject properties by virtue of its unconstitutional purchase. It is well-established that equity as a rule will follow the law and will not permit that to be done indirectly which, because of public policy, cannot be done directly. Surely, a contract that violates the Constitution and the law is null and void, vests no rights, creates no obligations and produces no legal effect at all. Corollary thereto, under Article 1412 of the Civil Code, petitioner cannot have the subject properties deeded to him or allow him to recover the money he had spent for the purchase thereof. The law will not aid either party to an illegal contract or agreement; it leaves the parties where it finds them. Indeed, one cannot salvage any rights from an unconstitutional transaction knowingly entered into. Neither can the Court grant petitioners claim for reimbursement on the basis of unjust enrichment. As held in Frenzel v. Catito, a case also involving a foreigner seeking monetary reimbursement for money spent on purchase of Philippine land, the provision on unjust enrichment does not apply if the action is proscribed by the Constitution, to wit: Futile, too, is petitioner's reliance on Article 22 of the New Civil Code which reads: Art. 22. Every person who through an act of performance by another, or any other means, acquires or comes into possession of something at the expense of the latter without just or legal ground, shall return the same to him.1wphi1 The provision is expressed in the maxim: "MEMO CUM ALTERIUS DETER DETREMENTO PROTEST" (No person should unjustly enrich himself at the expense of another). An action for recovery of what has been paid without just cause has been designated as an accion in rem verso. This provision does not apply if, as in this case, the action is proscribed by the Constitution or by the application of the pari delicto doctrine. It may be unfair and unjust to bar the petitioner from filing an accion in rem verso over the subject properties, or from recovering the money he paid for the said properties, but, as Lord Mansfield stated in the early case of Holman v. Johnson: "The objection that a contract is immoral or illegal as between the plaintiff and the defendant, sounds at all times very ill in the mouth of the defendant. It is not for his sake, however, that the objection is ever allowed; but it is founded in general principles of policy, which the defendant has the advantage of, contrary to the real justice, as between him and the plaintiff." Nor would the denial of his claim amount to an injustice based on his foreign citizenship. Precisely, it is the Constitution itself which demarcates the rights of citizens and non-citizens in owning Philippine land. To be sure, the constitutional ban against foreigners applies only to ownership of Philippine land and not to the improvements built thereon, such as the two (2) houses standing on Lots 1 and 2142 which were properly declared to be coowned by the parties subject to partition. Needless to state, the purpose of the prohibition is to conserve the national patrimony and it is this policy which the Court is duty-bound to protect.

6 NESTOR N. PADALHIN and ANNIE PADALHIN vs. NELSON D. LAVINA G.R. No. 183026 November 14, 2012 REYES, J.: FACTS: Lavia and Nestor were both Filipino diplomats assigned in Kenya as Ambassador and Consul General, respectively. In the course of their stay in Kenya, the residence of Lavia was raided twice. Prior to the raids, Bienvenido Pasturan (Pasturan) delivered messages to the Filipino household helpers in the ambassadors residence instructing them to allow the entry of an officer who would come to take photographs of the ivory souvenirs kept therein. Subsequently, both Nestor and Lavia were recalled from their posts in Kenya. On November 17, 1997, Lavia filed before the RTC a complaint for damages against Nestor and his wife, petitioner Annie Padalhin (Annie) Palao, Cabando, Manalo, Ebdalin and Dizon. On July 6, 1998, Lavia amended his complaint to include Pasturan as a defendant. Lavias complaint alleged the following causes of action, to wit: (a) affront against his privacy and the sanctity and inviolability of his diplomatic residence during the two raids conducted by the Kenyan officials, supposedly instigated by Padalhin and participated by all the defendants as conspirators; (b) infringement of his constitutional rights against illegal searches and seizures when the investigating team sent by the DFA entered into his residence without a warrant, court order or letter from the DFA Secretary and confiscated some of his personal belongings; and (c) bad faith, malice and deceit exhibited by the defendants, including Padalhin, in conspiring on the conduct of the raids, engaging in a smear campaign against him, and seizing without authority his personal effects. Lavia sought payment of actual, moral, exemplary and nominal damages, attorneys fees and costs of suits. ISSUE: Whether or not respondent is entiled to damages for violation of his right to privacy. RULING: Yes. Plaintiff-appellants complaint is mainly anchored on Article 19 in relation to Articles 21 and 26 of the New Civil Code. These provisions of the law state thus: "Article 19. 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." "Article 21. Any person who willfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage." "Article 26. Every person shall respect the dignity, personality, privacy and peace of mind of his neighbors and other persons. The following and similar acts, though they may not constitute a criminal offense, shall produce a cause of action for damages, prevention and other relief: (1) Prying into the privacy of anothers residence: (2) Meddling with or disturbing the private life or family relations off [sic] another; (3) Intriguing to cause another to be alienated from his friends; (4) Vexing or humiliating another on account of his beliefs, lowly station in life, place of birth, physical defect, or other personal condition."

7 The Comment of Tolentino on what constitute an abuse of rights under Article 19 of the New Civil Code is pertinent: "Test of Abuse of Right. Modern jurisprudence does not permit acts which, although not unlawful, are anti-social. There is undoubtedly an abuse of right when it is exercised for the only purpose of prejudicing or injuring another. When the objective of the actor is illegitimate, the illicit act cannot be concealed under the guise of exercising a right. The principle does not permit acts which, without utility or legitimate purpose cause damage to another, because they violate the concept of social solidarity which considers law as rational and just. x x x." The question, therefore, is whether defendant-appellant intended to prejudice or injure plaintiff-appellant when he did the acts as embodied in his affidavit. The Court ruled in the affirmative. Defendant-appellants participation in the invasion of plaintiff-appellants diplomatic residence and his act of ordering an employee to take photographs of what was inside the diplomatic residence without the consent of the plaintiffappellant were clearly done to prejudice the latter. Moreover, we find that defendantappellant was not driven by legitimate reasons when he did the questioned acts. As pointed out by the court a quo, defendant-appellant made sure that the Kenyan Minister of Foreign Affairs and the Filipino community in Kenya knew about the alleged illegal items in plaintiffappellants diplomatic residence. As already exhaustively discussed by both the RTC and the CA, Nestor himself admitted that he caused the taking of the pictures of Lavina's residence without the latter's knowledge and consent. Nestor reiterates that he did so sans bad faith or malice. However, Nestor's surreptitious acts negate his allegation of good faith. If it were true that Lavina kept ivories in his diplomatic residence, then, his behavior deserves condemnation. However, that is not the issue in the case at bar. Nestor violated the New Civil Code prescriptions concerning the privacy of one's residence and he cannot hide behind the cloak of his supposed benevolent intentions to justify the invasion. Hence, the award of damages and attorney's fees in Lavina's favor is proper.