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December 2012 Philippine Supreme Court Decisions on Civil Law

Tagged damages, Public Land Act, sale, unjust enrichment

Here are select December 2012 rulings of the Supreme Court of the Philippines on civil
Civil Code
Damages; When Applicable. It is essential that for damages to be awarded, a claimant
must satisfactorily prove during the trial that they have a factual basis, and that the
defendants acts have a causal connection to them. Article 2229 of the Civil Code
provides that exemplary damages may be imposed by way of example or correction for
the public good, in addition to the moral, temperate, liquidated or compensatory
damages. They are, however, not recoverable as a matter of right. They are awarded
only if the guilty party acted in a wanton, fraudulent, reckless, oppressive or malevolent
manner. Albert M. Ching, et al. vs. Felix M. Bantolo, et al.; G.R. No. 177086. December
5, 2012
Sale of Real Property; Must be in a Public Document; requirement only for convenience.
Article 1358 of the Civil Code provides that acts and contracts which have for their
object the transmission of real rights over immovable property or the sale of real
property must appear in a public document. If the law requires a document or other
special form, the contracting parties may compel each other to observe that form, once
the contract has been perfected. In Fule v. Court of Appeals, the Court held that Article
1358 of the Civil Code, which requires the embodiment of certain contracts in a public
instrument, is only for convenience, and registration of the instrument only adversely
affects third parties. Formal requirements are, therefore, for the benefit of third parties.
Non-compliance therewith does not adversely affect the validity of the contract nor the
contractual rights and obligations of the parties thereunder. Lagrimas de Jesus Zamora
v. Spouses Beatriz Zamora et al., G.R. No. 162930. December 5, 2012.
Unjust enrichment; reimbursement. 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. Willem Beumer v. Avelina
Amores, G.R. No. 195670. December 3, 2012.

Prepared by: Harold B. Lacaba

Special Laws
Public Land Act; Five-year Prohibition for Alienation of Homestead Patent; Sale; Void
Contract. To reiterate, Section 118 of the Public Land Act, as amended, reads that
[e]xcept in favor of the Government or any of its branches, units, or institutions, or
legally constituted banking corporations, lands acquired under free patent or homestead
provisions shall not be subject to encumbrance or alienation from the date of the
approval of the application and for a term of five years from and after the date of
issuance of the patent or grant x x x. The provisions of law are clear and explicit. A
contract which purports to alienate, transfer, convey, or encumber any homestead
within the prohibitory period of five years from the date of the issuance of the patent is
void from its execution. In a number of cases, this Court has held that such provision is
mandatory. Alejandro Binayug and Ana Binayug vs. Eugenio Ugaddan, et al. G.R. No.
181623. December 5, 2012.

Prepared by: Harold B. Lacaba