I.

Loan
CONTRACTS OF LOAN
(1) Commodatum a contract where one
party delivers to another something not
consumable so that the latter may use the
same for a certain sum and return it. [Art.
1933]
(2) Mutuum (Simple Loan) a contract where
one party delivers to another money or
other consumable thing, upon the
condition that the same amount of the
same kind and quality shall be paid. [Art.
1933]
CONTRACT OF LOAN VS. CONTRACT
TO LOAN
Contract of Loan Contract to Loan
Real Contract;
perfected, not by mere Consensual Contract:
consent, but the perfected by mere
delivery of the consent.
contract.
Ownership of the thing Ownership is
loaned is retained by transferred to the
lender [Art.1933] borrower

SIMPLE LOAN VS. BARTER

In simple loan, the primary purpose of the
contract is the permissive use of the money or
consumable property. Ownership is transferred
as a necessary consequence of the permissive
use of the property loan
In barter, the primary purpose of the contract is
the transfer of ownership of a non-fungible
property, and payment is made by giving some
thing of the same kind, quantity and quality
COMMODATUM VS. MUTUUM
Commodatum Mutuum
Ordinarily involves
Involves money or
something not
other consumable
consumable*
thing
[Art.1936]
Ownership of the thing Ownership is
loaned is retained by transferred to the
lender [Art.1933] borrower
May be gratuitous or
Essentially gratuitous
onerous, i.e. with
[Art.1933]
stipulated interest
Borrower must return Borrower need only
 pay an equal amount
the same thing loaned
of the same kind and
[Art.1933]
quality [Art. 1953]
May involve real or
Refers only to personal
personal property
property
[Art.1937]
Loan for use or
temporary possession Loan for consumption
[Art.1935]
Bailor may demand
the return of the thing Lender may not
loaned before the demand its return
expiration of the term before the lapse of the
in case of urgent need term agreed upon
[Art.1946]
Borrower suffers the
loss even if caused
Bailor suffers the loss
exclusively by a
of the subject matter
fortuitous event and
since he is the owner
he is not, therefore,
[Art.1942; Art.1174]
discharged from his
duty to pay
Purely personal in Not purely personal in
character [Art 1939] character

A. COMMODATUM
Commodatum an essentially gratuitous
contract where one party delivers to another

something not consumable so that the latter

may use the same for a certain time and return
it. [Art. 1933]
A.1. KINDS OF COMMODATUM
(1) Ordinary commodatum the use of the
thing by the bailee is for a certain period of
time [Art. 1933]
(2) Precarium one where the bailor may
demand the thing loaned at will; if any one
of the following is present
(a) The duration and purpose of the
contract is not stipulated
(b) The use of the thing is merely tolerated
by the owner [Art. 1947]
A.2. PARTIES
The Civil Code refers to the parties in a
commodatum as the bailor (creditor) or bailee
(debtor).
Who may be a bailor in commodatum?
Anyone. The bailor in commodatum need not
be the owner of the thing loaned. [Art. 1938]
But the bailee himself may not lend nor lease
the thing loaned to him to a third person. [ Art.
1939 (2)]
A.3. OBLIGATIONS OF THE BAILEE
(1) Obligation to take care of it with the proper
diligence of a good father of a family. [Art.
1163
]
(2) Obligation to use the thing loaned only for
the purpose for which it was loaned and
not for any other purpose. [Art. 1935, 1939
[2], 1942 [1]]
(3) Obligation to not lend the thing to a third
person who is not a member of his
household. [Art. 1942 [4]]
(4) Obligation to return the thing upon the
expiration of the period stipulated or after
the accomplishment of the use for which it
has been constituted. [Art. 1944, 1946]
(5) Obligation to pay for the ordinary expenses
for the use and preservation of the thing
loaned. [Art. 1941]
(6) Obligation to be solidarily liable when
there are two or more bailees to whom a
thing is loaned in the same contract. [Art.
1945
]
A.4. OBLIGATIONS OF THE BAILOR
(1) Obligation to refund the extraordinary
expenses during the contract for the
preservation of the thing loaned. [Art.
1949
]
(2) Obligation to bear equally the
extraordinary expenses arising on the
occasion of actual use of the thing by the
bailee. [Art. 1949]
Exception: Contrary stipulation
(3) Obligation to pay damages to the bailee
for hidden flaws known to the bailor. [Art.
1951
]
NOTE: Bailor has no right of abandonment; he
cannot exempt himself from payment of
expenses or damages to the bailee by
abandoning the thing to the latter. [Art. 1952]
A.5. LIABILITY FOR DETERIORATION
General rule: the bailee is liable for the
deterioration of the thing loaned.
Exception: when the deterioration of the thing
is due only to the use thereof and without his
fault. [Art. 1943]
A.6. RIGHT OF RETENTION
General Rule: the Bailee has no right of
retention of the thing loaned on the ground
that the Bailor owes him something, even
though it may be by reason of expenses.
Exception: the Bailee has the right of retention
for damages arising from hidden flaws. [Art.
1944]

B. MUTUUM
Mutuum a contract where one of the parties
delivers to another money or other consumable
thing upon the condition that the same
amount of the same kind and quality shall be
paid.
B.1. OBLIGATIONS OF THE BORROWER
(1) Obligation to pay to the creditor an equal
amount of the same kind and quality. [Art.
1953
]
(2) If stipulated, the borrower has the
obligation to pay interest. [Art. 1956]
B.2. INTEREST AND SUSPENSION OF
USURY LAW
Interest the compensation allowed by law or
fixed by the parties for the loan or forbearance
of money, goods or credits.
B.3. KINDS OF INTEREST
(1) Simple interest Paid for the principal at a
certain rate fixed or stipulated by the
parties.
(2) Compound Interest that which is imposed
upon interest due and unpaid.
(3) Legal Interest that which the law directs
to be charged in the absence of any
agreement as to the rate between the
parties.
(4) Lawful Interest that which the laws allow
or do not prohibit.
(5) Unlawful or Usurious Interest paid or
stipulated to be paid beyond the maximum
fixed by law. However, by virtue of CB
Circular 905, usury has become legally
inexistent.
B.4. WHEN IS COMPOUND INTEREST
ALLOWED?
(1) When there is an express written
stipulation to that effect [Art.1956]
(2) Upon judicial demand. However, debtor is
not liable to pay compound interest even
after judicial demand when there is no
stipulation for payment of interest.
[Art.2212]
B.5. REQUISITES FOR INTEREST TO BE
CHARGEABLE
(1) Must be expressly stipulated [Art. 1956]
Exceptions:
(a) The debtor in delay is liable to pay
legal interest (6% or 12% per annum)
as indemnity for damages [Art.2209]
(b) Interest accruing from unpaid interest
Interest demanded shall earn
interest from the time it is judicially
demanded [Art.2212] or where there is
an express stipulation [Art.1959]
(2) Agreement must be in writing [Art.1956]
(3) Must be lawful
Rules for award of interest in the concept of
actual and compensatory damages [Nacar v.
Gallery Frames, G.R. No. 189871 [2013]
modifying Eastern Shipping Lines vs. CA,
[1994] in light of BSP-MB Circular No. 799]
(1) When the obligation is breached, and it
consists in the payment of a sum of money,
i.e., a loan or forbearance of money, the
interest due should be that which may
have been stipulated in writing.
Furthermore, the interest due shall itself
earn legal interest from the time it is
judicially demanded. In the absence of
stipulation, the rate of interest shall be 6%
per annum to be computed from default,
i.e., from judicial or extrajudicial demand
under and subject to the provisions of
Article 1169 of the Civil Code.
(2) When an obligation, not constituting a loan
or forbearance of money, is breached, an
interest on the amount of damages
awarded may be imposed at the discretion
of the court at the rate of 6% per annum.
No interest, however, shall be adjudged on
unliquidated claims or damages, except
when or until the demand can be
established with reasonable certainty.
Accordingly, where the demand is
established with reasonable certainty, the
interest shall begin to run from the time
the claim is made judicially or
extrajudicially [Art. 1169, Civil Code], but
when such certainty cannot be so
reasonably established at the time the
demand is made, the interest shall begin
to run only from the date the judgment of
the court is made [at which time the
quantification of damages may be deemed
to have been reasonably ascertained]. The
actual base for the computation of legal
interest shall, in any case, be on the
amount finally adjudged.
(3) When the judgment of the court awarding a
sum of money becomes final and executory,
the rate of legal interest, whether the case
falls under paragraph 1 or paragraph 2,
above, shall be 6% per annum from such
finality until its satisfaction, this interim
period being deemed to be by then an
equivalent to a forbearance of credit.
Forbearance within the context of usury law,
is a contractual obligation of lender or creditor
to refrain, during given period of time, from
requiring borrower or debtor to repay loan or
debt then due and payable [Bataan Seedling v.
Republic, 383 SCRA 590]
THE USURY LAW (Act No.2566) an act fixing
rates of interests upon loans and declaring the
effect of receiving or taking usurious rates and
for other purposes. [Arevalo v. Dimayuga,
1927
]
CB Circular No. 905 abolished interest rate
ceilings. With the promulgation of such
circular, usury has become legally inexistent
as the parties can now legally agree on any
interest that may be charged on the loan.
B.6. ELEMENTS OF USURY
(a) A loan or forbearance of money
(b) An understanding between parties that the
loan shall and may be returned
(c) An unlawful intent to take more than the
legal rate for the use of money or its
equivalent
(d) The taking or agreeing to take for the use
of the loan of something in excess of what
is allowed by law.
Note: A usurious loan transaction is not a
complete nullity but defective only with respect
to the agreed interest. [Carpo v. Chua, G.R.
Nos. 150773 and 153599, September 30, 2005]
II. Deposit
A deposit is constituted from the moment a
person receives a thing belonging to another,
with the obligation of safely keeping it and of
returning the same. [Art. 1962]
OBJECT OF DEPOSIT
Art. 1966 provides that only movable things
may be the object of a deposit. However, Art.
2006 provides that movable as well as
immovable property may be the object of
sequestration or judicial deposit.
PRINCIPAL PURPOSE
Safekeeping of the thing; if NOT, there is NO
DEPOSIT but some other contract. [Art. 1962]
CONSIDERATION
A deposit is generally gratuitous, except:
(1) If there is an agreement to the contrary
(2) Unless the depositary is engaged in the
business of storing goods [Art. 1965]
KINDS OF DEPOSIT
(1) Extrajudicial
(a) Voluntary obligation arises as a
consequence of contract

(b) Necessary obligation arises as a

consequence of law or quasi-contract
(2) Judicial obligation arises as a
consequence of a law allowing the
issuance of a judicial order constituting a
deposit
A. VOLUNTARY DEPOSIT
Voluntary deposit an agreement to constitute
a deposit is binding, but the deposit itself is a
real contract, as it is not perfected until the
delivery of the thing. [Art. 1963]
HOW ENTERED INTO: Orally or in writing [Art.
1969
]
HOW PERFECTED: The deposit is perfected
upon delivery, which is made by the will of the
depositor. [Arts. 1963, 1968]
A deposit may be made by two or more
persons (who believe that they are entitled to
the thing deposited with a third person). Said
person is to deliver the thing to the one to
whom it belongs. [Art. 1968]
A.1. EXTINGUISHMENT
(1) Loss or destruction of thing deposited, or
(2) In case of a gratuitous deposit, upon the
death of either the depositor or depositary
[Art. 1995]. The depositary is not obliged to
continue with the contract of deposit
(3) By other modes provided in the Civil Code,
e.g. novation, merger, etc. [See Art.1231]
A.2. OBLIGATIONS OF DEPOSITOR
(1) Depositor is obliged to reimburse the
depositary for expenses incurred for
preservation if deposit is gratuitous.
[Art.1992]
(2) Depositor is obliged to pay losses incurred
due to character of thing deposited. [Art.
1993
]
General rule: The depositor shall reimburse the
depositary for any loss arising from the
character of the thing deposited [Art. 1993]
Exceptions:
(1) Depositor was not aware of the danger;
(2) Depositor was not expected to know the
dangerous character of the thing;
(3) Depositor notified the depositary of such
dangerous character;
(4) Depositary was aware of the danger
without advice from the depositor.
B. NECESSARY DEPOSIT
Made in compliance with a legal obligation, or
on the occasion of any calamity, or by travelers
in hotels and inns [Arts.1996-2004] or by
travelers with common carriers [Arts.1734-
1735
]
B.1. KINDS OF NECESSARY DEPOSIT
(1) It is made in compliance with a legal
obligation, in which case it is governed by
the law establishing it, and in case of
deficiency, the rules on voluntary deposit,
e.g., Arts. 538, 586 and 2104
(2) It takes place on the occasion of any
calamity, such as fire, storm, flood, pillage,
shipwreck, or other similar events. There
must be a causal relation between the
calamity and the constitution of the
deposit. In this case the deposit is
governed by the rules on voluntary deposit
and Art. 2168
(3) Made by passengers with common carriers.
[Art.1754]
(4) Made by travelers in hotels or inns. [ Art.
1998
]
B.2. DEPOSIT BY TRAVELERS IN HOTELS
AND INNS
Before keepers of hotels or inns may be held
responsible as depositaries with regard to the
effects of their guests, the following must
concur:

(a) They have been previously informed about

the effects brought by the guests; and
(b) The latter have taken the precautions
prescribed regarding their safekeeping.
B.3. EXTENT OF LIABILITY UNDER
ART.1998
(1) Those in hotel rooms which come under
the term baggage or articles such as
clothing as are ordinarily used by travelers
(2) Include those lost or damaged in hotel
annexes such as vehicles in the hotels
garage.
B.4. WHEN HOTEL-KEEPER LIABLE
Regardless of the amount of care exercised the
hotel-keeper is liable when
(1) The loss or injury to personal property is
caused by his servants or employees as
well as by strangers [Art. 2000].
(2) The loss is caused by the act of a thief or
robber done without the use of arms and
irresistible force. [Art. 2001]
B.5. WHEN HOTEL-KEEPER NOT LIABLE
(1) The loss or injury is caused by force
majeure, like flood, fire, [Art.2000] theft or
robbery by a strangernot the hotelkeepers servant or employeewith the use
of firearms or irresistible force [Art.2001]
Exception: Hotel-keeper is guilty of fault or
negligence in failing to provide against the
loss or injury from his cause. [Arts.1170 and
1174
]
(2) The loss is due to the acts of the guests, his
family, servants, visitors [Art.2002]
(3) The loss arises from the character of the
things brought into the hotel [Ibid.]
The hotel-keeper cannot free himself from
responsibility by posting notices to the effect
that he is not liable for the articles brought by
the guest. Such kind of stipulation shall be
void. [Art. 2003]
Regarding the legal deposit of a vehicle that
was stolen while parked with Saisaki
restaurant, the depositary may not exempt
itself from responsibility for loss or damage of
the thing deposited with it, by exclusionary
stipulation. Such stipulations are void for being
contrary to law. [Triple-V Food Services v.
Filipino Merchants Insurance Company,
February 21, 2005]
B.6. HOTEL-KEEPERS RIGHT TO
RETENTION
The hotel-keeper has a right to retain the
things brought into the hotel by the guest, as a
security for credits on account of
(1) lodging, and
(2) supplies usually furnished to hotel guests
[Art. 2004]
The right of retention recognized in this article
is in the nature of a pledge created by
operation of law.
C. JUDICIAL DEPOSIT
Takes place when an attachment or seizure of
property in litigation is ordered [Arts. 2005-
2009
]
C.1. NATURE AND PURPOSE
It is auxiliary to a case pending in court. The
purpose is to maintain the status quo during
pendency of the litigation or to insure the right
of the parties to the property in case of a
favorable judgment.
C.2. DEPOSITARY OF SEQUESTERED
PROPERTY
A person is appointed by the court [Art. 2007]
with the obligations
(1) To take care of the property with the
diligence of a good father of the family.
[Art. 2008]
(2) To continue in his responsibility until the
controversy which give rise thereto is

ended unless the court so orders. [Art.

2007
]
C.3. APPLICABLE LAW
Judicial deposit law is remedial or procedural.
The Rules of Court shall govern matters not
provided for in the Civil Code. [Art. 2009]
III. Guaranty and
Suretyship
Guaranty a contract whereby a person, called
the guarantor, binds himself to the creditor to
fulfill the obligation of the principal debtor in
case the latter should fail to do so. [Art. 2047]
While a surety undertakes to pay if the
principal does not pay, the guarantor only
binds himself to pay if the principal cannot pay.
[See benefit of excussion, Art. 2058]
Suretyship a relation which exists where one
person [principal] has undertaken an
obligation and another person (surety) is also
under a direct and primary obligation or other
duty to a third person (obligee), who is entitled
to but one performance, and as between the
two who are bound, the one rather than the
other should perform.
If a person binds himself solidarily with the
principal debtor, the contract is called
suretyship and the guarantor is called a surety.
Guaranty distinguished from suretyship [Zobel,
Inc. vs. CA, 1998
]
An accessory promise
by which a person A collateral
binds himself for undertaking to pay
another already the debt of another in
bound, and agrees case the latter does
with the creditor to not pay the debt.
satisfy the obligation

if the debtor does not

A surety is usually The contract of
bound with his guaranty is the
principal by the same guarantor's own
instrument, executed separate undertaking,
at the same time, and in which the principal
on the same does not join. It is
consideration. He is usually entered into
an original promissor before or after that of
and debtor from the the principal, and is
 often supported on a
separate
consideration from
that supporting the
beginning, and is contract of the
held, ordinarily, to principal. The original
know every default of contract of his
his principal. principal is not his
contract, and he is not
bound to take notice
of its non
performance
A surety will not be
A guarantor is often
discharged, either by
discharged by the
the mere indulgence
mere indulgence of
of the creditor to the
the creditor to the
principal, or by want
principal, and is
of notice of the
usually not liable
default of the
unless notified of the
principal, no matter
default of the
how much he may be
principal
injured thereby
A guarantor is the
A surety is the insurer
insurer of the solvency
of the debt, and he
of the debtor and thus
obligates himself to
binds himself to pay if
pay if the principal
the principal is unable
does not pay
to pay

A. NATURE AND EXTENT OF

GUARANTY
A guaranty is generally gratuitous [Art. 2048]
General rule: Guaranty is gratuitous
Exception: When there is a stipulation to the

contrary
On the cause of a guaranty contract
A guarantor or surety is bound by the same
consideration that makes the contract effective
between the principal parties thereto.
[Severino v. Severino, 1931]
Presence of cause which supports principal
obligation: Cause of the contract is the same
cause which supports the obligation as to the
principal debtor. The consideration which
supports the obligation as to the principal
debtor is a sufficient consideration to support
the obligation of a guarantor or surety.
Absence of direct consideration or benefit to
guarantor: Guaranty or surety agreement is
regarded valid despite the absence of any
direct consideration received by the guarantor
or surety, such consideration need not pass
directly to the guarantor or surety; a
consideration moving to the principal will
suffice.
A married woman who is a guarantor binds only
her separate property, generally [Art. 2049]
Exceptions:
(1) With her husbands consent, bind the
community or conjugal partnership
property
(2) Without husbands consent, in cases
provided by law, such as when the
guaranty has redounded to the benefit of
the family.
A guaranty need not be undertaken with the
knowledge of the debtor [Art. 2050]
Guaranty is unilateral. It exists for the benefit
of the creditor and not for the benefit of the
principal debtor
Creditor has every right to take all possible
measures to secure payment of his credit
guaranty can be constituted even against the
will of the principal debtor
However, as regards payment made by a third
person
(1) If payment is without the knowledge or
against the will of the debtor
(a) Guarantor can recover only insofar as
the payment has been beneficial to the
debtor [Art. 1236]
(b) Guarantor cannot compel the creditor
to subrogate him in his rights [Art.
1237
]
(2) If payment is with knowledge or consent of
the debtor: Subrogated to all the rights
which the creditor had against the debtor
The guaranty must be founded on a valid
principal obligation [Art. 2052 (1)]
Guaranty is an accessory contract: It is an
indispensable condition for its existence that
there must be a principal obligation. Hence, if
the principal obligation is void, it is also void.
A guaranty may secure the performance of a
voidable, unenforceable, and natural obligation
[Art. 2052(2)]
A guaranty may secure the performance of a:
(1) Voidable contract such contract is
binding, unless it is annulled by a proper
court action
(2) Unenforceable contract because such
contract is not void
(3) Natural obligation the creditor may
proceed against the guarantor although he
has no right of action against the principal
debtor for the reason that the latters
obligation is not civilly enforceable. When
the debtor himself offers a guaranty for his
natural obligation, he impliedly recognizes
his liability, thereby transforming the
obligation from a natural into a civil one.
A guaranty may secure a future debt [Art.
2053
]
Continuing Guaranty

(1) Not limited to a single transaction but

which contemplates a future course of
dealings, covering a series of transactions
generally for an indefinite time or until
revoked.
(2) It is prospective in its operation and is
generally intended to provide security with
respect to future transactions.
(3) Future debts, even if the amount is not yet
known, may be guaranteed but there can
be no claim against the guarantor until the
amount of the debt is ascertained or fixed
and demandable.
Rationale: A contract of guaranty is subsidiary
(1) To secure the payment of a loan at
maturity surety binds himself to
guarantee the punctual payment of a loan
at maturity and all other obligations of
indebtedness which may become due or
owing to the principal by the borrower.
(2) To secure payment of any debt to be
subsequently incurred a guaranty shall
be construed as continuing when by the
terms thereof it is evident that the object is
to give a standing credit to the principal
debtor to be used from time to time either
indefinitely or until a certain period,
especially if the right to recall the guaranty
is expressly reserved.
(3) To secure existing unliquidated debts
refers to debts existing at the time of the
constitution of the guaranty but the
amount thereof is unknown and not to
debts not yet incurred and existing at that
time.
(4) The surety agreement itself is valid and
binding even before the principal obligation
intended to be secured thereby is born; for
example, those securing obligations
subject to a condition precedent are valid
and binding before the occurrence of the
condition precedent.
A guaranty may secure the performance of a
conditional obligation [Art. 2053]
(1) Principal obligation subject to a suspensive
condition the guarantor is liable only
after the fulfillment of the condition.
(2) Principal obligation subject to a resolutory
condition the happening of the condition
extinguishes both the principal obligation
and the guaranty
A guarantors liability cannot exceed the
principal obligation [Art. 2054]
General rule: Guaranty is a subsidiary and
accessory contract guarantor cannot bind
himself for more than the principal debtor and
even if he does, his liability shall be reduced to
the limits of that of the debtor. But the
guarantor may bind himself for less than that
of the principal.
Exceptions:
(1) Interest, judicial costs, and attorneys fees
as part of damages may be recovered
creditors suing on a suretyship bond may
recover from the surety as part of their
damages, interest at the legal rate, judicial
costs, and attorneys fees when
appropriate, even without stipulation and
even if the surety would thereby become
liable to pay more than the total amount
stipulated in the bond.
Interest runs from:
Filing of the complaint (upon judicial
demand); or
The time demand was made upon the
surety until the principal obligation is
fully paid (upon extra-judicial demand)
Rationale: Surety is made to pay, not by
reason of the contract, but by reason of his
failure to pay when demanded and for
having compelled the creditor to resort to
the courts to obtain payment.
(2) Penalty may be provided a surety may be

held liable for the penalty provided for in a

bond for violation of the condition therein.
Principals liability may exceed guarantors
obligations
The amount specified in a surety bond as the
suretys obligation does not limit the extent of
the damages that may be recovered from the
principal, the latters liability being governed
by the obligations he assumed under his
contract
The existence of a guaranty is not presumed
[Art. 2055]
Guaranty requires the expression of consent on
the part of the guarantor to be bound. It
cannot be presumed because of the existence
of a contract or principal obligation.
Rationale:
(1) There be assurance that the guarantor had
the true intention to bind himself;
(2) To make certain that on making it, the
guarantor proceeded with consciousness of
what he was doing.
Contract of guaranty is covered by the Statute
of Frauds [See Art. 1403
(2) (b)]
Guaranty must not only be expressed but must
so be reduced into writing. Hence, it shall be
unenforceable by action, unless the same or
some note or memorandum thereof be in
writing, and subscribed by the party charged,
or by his agent; evidence, therefore, of the
agreement cannot be received without the
writing, or a secondary evidence of its contents.
However, it need not appear in a public
document
B. NATURE AND EXTENT OF
SURETYSHIP
Liability is contractual and accessory but direct.
Liability is limited by the terms of the contract.
Liability arises only if principal debtor is held
liable
(1) In the absence of collusion, the surety is
bound by a judgment against the principal
even though he was not a party to the
proceedings;
(2) The creditor may sue, separately or
together, the principal debtor and the
surety;
(3) A demand or notice of default is not
required to fix the suretys liability
Exception: Where required by the
provisions of the contract of suretyship
(4) A surety bond is void where there is no
principal debtor because such an
undertaking presupposes that the
obligation is to be enforceable against
someone else besides the surety, and the
latter can always claim that it was never
his intention to be the sole person
obligated thereby.
Note: A surety is not entitled to exhaustion
The undertaking is to the creditor, not the
debtor
The surety makes no covenant or
agreement with the principal that it will fulfill
the obligation guaranteed for the benefit of the
principal. The suretys undertaking is that the
principal shall fulfill his obligation and that the
surety shall be relieved of liability when the
obligation secured is performed; unless
otherwise expressly provided.
Prior demand by the creditor upon the principal
is not required. The surety is not exonerated by
neglect of the creditor to sue the principal.
Strictissimi juris rule is applicable only to
accommodation surety.
Reason: An accommodation surety acts
without motive of pecuniary gain and hence,
should be protected against unjust pecuniary
impoverishment by imposing on the principal,

duties akin to those of a fiduciary. This rule will

apply only after it has been definitely
ascertained that the contract is one of
suretyship or guaranty.
Strictissimi juris rule is not applicable to
compensated sureties
Reasons:
(1) Compensated corporate sureties are
business associations organized for the
purpose of assuming classified risks in
large numbers, for profit and on an
impersonal basis.
(2) They are secured from all possible loss by
adequate counter-bonds or indemnity
agreements.
Such corporations are in fact insurers and in
determining their rights and liabilities, the
rules peculiar to suretyship do not apply.
The stipulation in the indemnity agreement
allowing the surety to recover even before it
paid the creditor is enforceable. In accordance
therewith, the surety may demand from the
indemnitors even before paying the creditors.
[Mercantile Insurance Company v. Ysmael, 169
SCRA 66, 1989
]
C. EFFECT OF GUARANTY
C.1. EFFECTS OF GUARANTY BETWEEN
THE GUARANTOR AND THE CREDITOR
1. The guarantor has the right to benefit from
excussion/ exhaustion [Art. 2058]
The guarantor cannot be compelled to pay
the creditor unless the latter has:
(a) Exhausted all of the property of the
debtor; and
(b) Resorted to all the legal remedies
against the debtor.
Exceptions to benefit of excussion [Art. 2059]
(1) As provided in Art. 2059:
(a) If the guarantor has expressly
renounced it.
(b) If he has bound himself solidarily with
the debtor. Here, the liability assumed
is that of a surety. The guarantor
becomes primarily liable as a solidary
co- debtor. In effect, he renounces in
the contract itself the benefit of
exhaustion.
(c) In case of insolvency of the debtor
guarantor guarantees the solvency of
the debtor. If the debtor becomes
insolvent, the liability of the guarantor
arises as the debtor cannot fulfill his
obligation
(d) When the debtor has absconded, or
cannot be sued within the Philippines
the creditor is not required to go after a
debtor who is hiding or cannot be sued
in our courts, and to incur the delays
and expenses incident thereto.
Exception: When the debtor has left a
manager or representative
(e) If it may be presumed that an execution
on the property of the principal debtor
would not result in the satisfaction of
the obligation If such judicial action
including execution would not satisfy
the obligation, the guarantor can no
longer require the creditor to resort to
all such remedies against the debtor as
the same would be but a useless
formality. It is not necessary that the
debtor be judicially declared insolvent.
The right of guarantorsto demand
exhaustion of the property of the principal
debtor, exists only when a pledge or a
mortgage has not been given as special
security for the payment of the principal
obligation. [Southern Motors, Inc. v.
Barbosa, 1956]
The surety in the present case bound itself
"jointly and severally" [in solidum] with the

defendant; and excussion [previous

exhaustion of the property of the debtor]
shall not take place "if he [the guarantor]
has bound himself solidarily with the
debtor."
[Luzon Steel Corp. v. Sia, 1969]
(2) If he does not comply with Art. 2060
In order that the guarantor may make use
of the benefit of excussion, he must:
(a) Set it up against the creditor upon the
latters demand for payment from him;
(b) Point out to the creditor:
(i) Available property of the debtor
the guarantor should facilitate the
realization of the excussion since
he is the most interested in its
benefit.
(ii) Within the Philippine territory
excussion of property located
abroad would be a lengthy and
extremely difficult proceeding and
would not conform with the
purpose of the guaranty to provide
the creditor with the means of
obtaining the fulfillment of the
obligation.
(iii) Sufficient to cover the amount of
the debt
(3) If he is a judicial bondsman and sub- surety
[Art. 2084]
(4) Where a pledge or mortgage has been
given by him as a special security
(5) If he fails to interpose it as a defense
before judgment is rendered against him.
2. The creditor has the right to secure a
judgment against the guarantor prior to the
excussion
General rule: An ordinary personal
guarantor (not a pledgor or mortgagor),
may demand exhaustion of all the property
of the debtor before he can be compelled
to pay.
Exception: The creditor may, prior thereto,
secure a judgment against the guarantor,
who shall be entitled, however, to a
deferment of the execution of said
judgment against him, until after the
properties of the principal debtor shall
have been exhausted, to satisfy the latters
obligation.
3. The creditor has the duty to make prior
demand for payment from the guarantor
[Art. 2060]
The demand is to be made only after
judgment on the debt.
Joining the guarantor in the suit against
the principal debtor is not the demand
intended by law. Actual demand has to be
made.
4. The guarantor has the duty to set up the
benefit of excussion [Art. 2060]
As soon as he is required to pay, guarantor
must also point out to the creditor
available property (not in litigation or
encumbered) of the debtor within the
Philippines.
5. The creditor has the duty to resort to all
legal remedies [Arts. 2058, 2061]
After the guarantor has fulfilled the
conditions required for making use of the
benefit of excussion, it becomes the duty of
the creditor to:
(1) Exhaust all the property of the debtor
pointed out by the guarantor;
(2) If he fails to do so, he shall suffer the
loss for the insolvency of the debtor,
but only to the extent of the value of
the said property
6. The creditor has the duty to notify the
guarantor in the action against the debtor
[Art. 2062]
Notice to the guarantor is mandatory in the
action against the principal debtor. The
guarantor, however, is not duty bound to
appear in the case, and his nonappearance shall not constitute default, w/
its consequential effects.
Rationale: To give the guarantor the
opportunity to allege and substantiate
whatever defenses he may have against
the principal obligation, and chances to set
up such defenses as are afforded him by
law
7. A compromise shall not prejudice the
person not party to it [Art. 2063]
A compromise between creditor and
principal debtor benefits the guarantor but
does not prejudice him.
A compromise between guarantor and the
creditor benefits but does not prejudice the
principal debtor.
8. Co-guarantors are entitled to the benefit of
division [Art. 2065]
The benefit of division applies only when
there are several guarantors and one
debtor for a single debt. Except when
solidarity has been stipulated, a coguarantor is liable only to the extent of his
share in the obligation as divided among
all the co-guarantors.
C.2. EFFECTS OF GUARANTY BETWEEN
THE DEBTOR AND THE GUARANTOR
1. The guarantor who pays has the right to be
subrogated to the rights of the creditor [ Art.
2067
]
A guarantor who pays the debt is entitled
to every remedy which the creditor has
against the principal debtor, to enforce
every security and all means of payments;
to stand in the place of the creditor not
only through the medium of the contract,
but even by means of the securities entered
into without the knowledge of the surety;
having the right to have those securities
transferred to him though there was no
stipulation for it, and to avail himself of all
securities against the debtor
The need to enforce the provisions on
indemnity in Article 2066 forms the basis
for the subrogation clause of Article 2067.
The assumption, however, is that the
guarantor who is subrogated to the rights
of the creditor, has the right to be
reimbursed for his answering for the
obligation of the debtor. Absent this right
of reimbursement, subrogation will not be
proper.
2. The guarantor has the duty to notify the
debtor before paying the creditor [Art.
2068]
Should payment be made without
notification, and supposing the debtor has
already made a prior payment, the debtor
would be justified in setting up the defense
that the obligation has already been
extinguished by the time the guarantor
made the payment. The guarantor will
then lose the right of reimbursement and
consequently the right of subrogation.
3. The guarantor cannot demand
reimbursement for payment made by him
before the obligation has become due [Art.
2069
]

General rule: Since a contract of guaranty

is only subsidiary, the guarantor cannot be
liable for the obligation before the period
on which the debtors liability will accrue.
Any payment made by the guarantor
before the obligation is due cannot be
indemnified by the debtor.
Exception: Prior consent or subsequent
ratification by the debtor
4. The guarantor may proceed against the
debtor even before payment has been made
[Art. 2071]
General rule: Guarantor has no cause of
action against the debtor until after the
former has paid the obligation.
Exceptions [Art. 2071]:
(a) When he is sued for the payment;
(b) In case of insolvency of the principal
debtor;
(c) When the debtor has bound himself to
relieve him from the guaranty within a
specified period, and this period has
expired;
(d) When the debt has become
demandable, by reason of the
expiration of the period for payment;
(e) After the lapse of 10 years, when the
principal obligation has no fixed period
for its maturity, unless it be of such
nature that it cannot be extinguished
except within a period longer than 10
years;
(f) If there are reasonable grounds to fear
that the principal debtor intends to
abscond;
(g) If the principal debtor is in imminent
danger of becoming insolvent.
Rationale: To enable the guarantor to take
measures for the protection of his interest
in view of the probability that he would be
called upon to pay the debt. As such, he
may, in the alternative, obtain release from
the guaranty; or demand security that shall
protect him from any proceeding by the
creditor, and against the insolvency of the
debtor.
Art. 2066 and 2071 Distinguished
Art. 2066 Art. 2071
Provides for the Provides for the
enforcement of the protection before
guaranty/surety against he has paid but
the debtor after he has after he has
paid the debt become liable
Gives a right of action Protective remedy
after payment before payment
Preliminary
Substantive Right
remedy

C.3. EFFECTS OF GUARANTY AS

BETWEEN CO-GUARANTORS
When there are two or more guarantors, one
debtor and one debt:
(a) The one who pays may demand from each
of the others the share proportionally
owing to him
(b) If any of the guarantors is insolvent, his
share shall be borne by the others,
including the payer, in the same proportion
[Art. 2073]
For purposes of proportionate reimbursement,
the other guarantors may interpose such
defenses against the paying guarantor as are
available to the debtor against the creditor,
except those that are personal to the debtor
[Art. 2074]
Requisites for the applicability of Art. 2073
(1) Payment has been made by one guarantor;
(2) The payment was made because
(a) Of the insolvency of the debtor, or

(b) By judicial demand

(3) The paying guarantor seeks to be
indemnified only to the extent of his
proportionate share in the total obligation.
D. EXTINGUISHMENT OF GUARANTY
Once the obligation of the debtor is
extinguished in any manner provided in the
Civil Code, the obligation of the guarantor is
also extinguished [Art. 2076]. However, there
may be instances when, after the
extinguishment of the guarantors obligation
(as in the case of a release from the guaranty),
the obligation of the debtor still subsists.
Although the guarantor generally has to make
payment in money, any other thing of value, if
accepted by the creditor, is valid payment and
therefore releases the guarantor (dacion en
pago) [Art. 2077].
If one guarantor is released without the
consent of the others, the release would
benefit the co-guarantors to the extent of the
proportionate share of the guarantor released
[Art. 2078].
A guarantor is released if the creditor, without
the guarantors consent, extends the time
within which the debtor may perform his
obligation [Art. 2079]. This is to protect the
interest of the guarantor should the debtor be
insolvent during the period of extension and
deprive the guarantor of his right to
reimbursement.
The guarantors are released if by some act of
the creditor they cannot be subrogated to the
rights, mortgages and preferences of the
latter. [Art. 2080]
In order to constitute an extension discharging
the surety, it should appear that the extension
was for (1) a definite period, (2) pursuant to an
enforceable agreement between the principal
and the creditor, and (3) that it was made
without the consent of the surety or with a
reservation of rights with respect to him.
[Filipinas Textile Mills v. CA, November 12,
2003
]
E. LEGAL AND JUDICIAL BONDS
Bond an undertaking that is sufficiently
secured, and not cash or currency.
Bondsman a surety offered in virtue of a
provision of law or a judicial order.
Qualifications of personal bondsman [2082 in
relation to Art. 2056
]
(1) He possesses integrity;
(2) He has capacity to bind himself;
(3) He has sufficient property to answer for the
obligation which he guarantees.
Pledge or mortgage in lieu of bond [2083]
Guaranty or suretyship is a personal security.
Pledge or mortgage is a property or real
security. If the person required to give a legal
or judicial bond should not be able to do so, a
pledge or mortgage sufficient to cover the
obligation shall be admitted in lieu thereof.
Bondsman not entitled to excussion [2084]
A judicial bondsman and the sub-surety are
not entitled to the benefit of excussion.
Reason: They are not mere guarantors, but
sureties whose liability is primary and solidary.
Effect of negligence of creditor
Mere negligence on the part of the creditor in
collecting from the debtor will not relieve the
surety from liability.
IV. Pledge
Pledge is a contract constituted to secure the
fulfillment of a principal obligation where the
thing pledged, which may be a movable, or an

incorporeal right evidenced by a document, is

placed in the possession of the creditor or a
third person by common agreement. [Art.
2093 in relation to Art. 2085
]
The pledgor must be the absolute owner of the
thing pledged, and he must have the free
disposal of the property, and in the absence
thereof, that he be legally authorized for the
purpose. [Art. 2085
(2) and (3)]
A. CHARACTERISTICS
(1) Real perfected upon the delivery of the
thing pledged [Art. 1316]
(2) Accessory cannot exist independently
(3) Unilateral obligation on the part of the
creditor to return the thing pledged upon
the fulfillment of the principal obligation
(4) Subsidiary obligation incurred does not
arise until the fulfillment of the secured
principal obligation
B. KINDS
(1) Voluntary or Conventional created by
agreement of the parties.
(2) Legal created by operation of law.
LEGAL PLEDGE / PLEDGE BY
OPERATION OF LAW [ARTS. 2121-2122]
(1) Necessary expenses shall be refunded to
every possessor, but only a possessor in
good faith may retain the thing until he has
been reimbursed.
Useful expenses shall be refunded only
to the possessor in good faith with the
same right of retention, the person who
has defeated him in the possession having
the option of refunding the amount of the
expenses or of paying the increase in value
which the thing may have acquired and by
reason thereof [Art. 546]
(2) He who has executed work upon a movable
has a right to retain it by way of pledge
until he is paid. This is called the
mechanics lien. [Art. 1731]
(3) The agent may retain the things which are
the objects of agency until the principal
effects the reimbursement and pays the
indemnity. This is called the agents lien.
[Art. 1914]
(4) The laborers wages shall be a lien on the
goods manufactured or the work done.
[Art. 1707]
NOTE:
(1) In legal pledges, the remainder of the price
of the sale shall be delivered to the obligor.
(2) Public auction of legal pledges may only
be executed after demand of the amount
for which the thing is retained. It shall take
place within one month after the demand,
otherwise the pledgor may demand the
return of the thing pledged, provided s/he
is able to show that the creditor did not
cause the public sale without justifiable
grounds. [Article 2122]
C. ESSENTIAL REQUISITES
Common to pledge and mortgage [Art. 2085]
(1) Constituted to secure the fulfillment of a
principal obligation.
(2) Pledgor or mortgagor must be the
absolute owner of the thing pledged or
mortgaged.
(3) The persons constituting the pledge or
mortgage have the free disposal of their
property, and in the absence thereof, that
they be legally authorized for the purpose.
(4) Cannot exist without a valid obligation.
(5) Debtor retains the ownership of the thing
given as a security.
(6) When the principal obligation becomes
due, the thing pledged or mortgaged may
be alienated for the payment to the
creditor. [Art. 2087]
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
439
PROVISIONS APPLICABLE ONLY TO
PLEDGE
(1) Transfer of possession to the creditor or to
third person by common agreement is
essential [Art. 2093].
(a) Actual delivery is important.
(b) Constructive or symbolic delivery of the
key to the warehouse is sufficient to
show that the depositary appointed by
common consent of the parties was
legally placed in possession.
(2) All movables within the commerce of man
may be pledged as long as they are
susceptible of possession [Art. 2094].
(3) Incorporeal rights may be pledged. The
instruments representing the pledged
rights shall be delivered to the creditor; if
negotiable, must be indorsed [Art. 2095].
(4) Pledge shall take effect against 3rd
persons only if the following appear in a
public instrument:
(a) Description of the thing pledged.
(b) Date of the pledge [Art. 2096].
(5) The thing pledged may be alienated by the
pledgor or owner only with the consent of
the pledgee. Ownership of the thing
pledged is transmitted to the vendee or
transferee as soon as the pledgee consents
to the alienation, but the latter shall
continue to have possession [Art. 2097].
(6) Creditor has the right to retain the thing in
his possession or in that of a third person
to whom it has been delivered, until the
debt is paid [Art. 2098].
(7) Special Laws apply to pawnshops and
establishments engaged in making loans
secured by pledges. Provisions of the Civil
Code shall apply subsidiarily to them.
In case of doubt as to whether a transaction is
a pledge or a dacion in payment, the
presumption is in favor of pledge, the latter
being the lesser transmission of rights and
interests. [Manila Banking Corp. v. Teodoro,
1989
]
D. REQUISITES FOR PERFECTION
(1) The thing pledged is placed in the
possession of the creditor or a third person
[Art. 2093]
(2) For the pledge to take effect as against
third persons, a description of the thing
pledged and the date of the pledge should
appear in a public instrument [Art. 2096]
E. OBLIGATIONS OF PLEDGEE
(1) The pledgee cannot deposit the thing
pledged with a 3rd person, unless there is
a contrary stipulation [Art. 2100].
(2) Is responsible for the acts of his agents or
employees with respect to the thing
pledged [Art. 2100].
(3) Has no right to use the thing or to
appropriate its fruits without authority
from the owner [Art. 2104]
(4) May cause the public sale of the thing
pledged if, without fault on his part, there
is danger of destruction, impairment or
diminution in value of the thing. The
proceeds of the auction shall be a security
for the principal obligation [Art. 2108].
F. RIGHTS OF PLEDGOR
(1) Takes responsibility for the flaws of the
thing pledged [Art. 2101 in relation to Art.
1951].
(2) Cannot ask for the return of the thing
against the will of the creditor, unless and
until he has paid the debt and its interest,
with expenses in a proper case [Art. 2105].
(3) Subject to the right of the pledgee under
article 2108, pledgor is allowed to
substitute the thing which is in danger of
destruction or impairment without any
fault on the part of the pledgee with
another thing of the same kind and quality
[Art. 2107].
(4) May require that the thing be deposited
with a 3rd person, if through the
negligence or willful act of the pledgee the
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
440
thing is in danger of being lost or impaired
[Art. 2106].
The pledgee can temporarily entrust the
physical possession of the chattels pledged to
the pledgor without invalidating the pledge.
The pledgor is regarded as holding the
pledged property merely as trustee for the
pledgee. The type of delivery will depend upon
the nature and the peculiar circumstances of
each case. [Yuliongsiu v. PNB (1968)]
A pledgee cannot become the owner of, nor
appropriate to himself, the thing given in
pledge. If by the contract of pledge the pledgor
continues to be the owner of the thing pledged
during the pendency of the obligation, it
stands to reason that in case of loss of the
property, the loss should be borne by the
pledgor. [PNB v. Atendido (1954)]
G. FORECLOSURE
G.1. Requirements in sale of the thing
pledged by a creditor, if credit is not paid
on time
[Art. 2112]
(1) Debt is due and unpaid.
(2) Sale must be at a public auction.
(3) Notice to the pledgor and owner, stating
the amount due.
(4) Sale must be made with the intervention of
a notary public.
(5) If at the first auction the thing is not sold, a
second one with the same formalities shall
be held.
(6) If at the second auction, there is no sale
either, the creditor may appropriate the
thing pledged but he shall give an
acquittance (release) for his entire claim.
G.2. EFFECTS OF THE SALE OF THE
THING PLEDGED
[Art. 2115]
(1) Extinguishes the principal obligation,
whether the proceeds of the sale is more or
less than the amount due.
(2) If the price of sale is more than amount
due, the debtor is not entitled to the excess
unless the contrary is provided.
(3) If the price of sale is less, the creditor is not
entitled to recover the deficiency. A
contrary stipulation is void.
H. PLEDGE AS DISTINGUISHED
FROM CHATTEL MORTGAGE [ARTS.
2140, 1484]
Chattel Mortgage Pledge
Delivery of Personal
Property
Delivery is required for
Not required
validity
Registration in the
Chattel Mortgage
Register
Not necessary;
Necessary for validity
Public document is
of the CM against
enough to bind third
third persons
persons
Right to Excess of
Proceeds of Sale
The excess goes to the
The excess goes to
pledgee/creditor,
the debtor/
unless otherwise
mortgagor
stipulated
Right to Recover
Deficiency
Creditor/ mortgagee is
Creditor/ mortgagee
not entitled to recover
can recover from the
any deficiency after the
debtor/ mortgagor,
property is sold,
except if covered by
notwithstanding
Recto Law
contrary stipulation

The provisions of the Civil Code on pledge,

insofar as they are not in conflict with the
Chattel Mortgage Law shall be applicable to
chattel mortgages [Art. 2141]
I. PACTUM COMMISSORIUM
It is a stipulation that allows the creditor to
appropriate the collateral, or dispose of it, in
contravention of the provisions on foreclosure,
and as such, is considered null and void
[Gomez-Somera].
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
441
ELEMENTS
(1) There is property pledged [collateral] by
way of security for the payment of the
principal obligation
(2) There is a stipulation for automatic
appropriation by the creditor in case of
non-payment of the principal obligation
within the stipulated period
EFFECT ON PLEDGE
The nullity of the pactum commissorium does
not affect the validity of the contract of pledge.
The creditor may recover the credit from the
proceeds of a foreclosure sale effected in
accordance with law [Gomez-Somera].
J. EQUITABLE MORTGAGE
It is a contract that reveals the intention of the
parties to charge property as security for a
debt, but contains nothing impossible or
contrary to law [Gomez-Somera].
ESSENTIAL REQUISITES
(1) Parties entered into a contract
denominated as a contract of sale
(2) The true intention is to secure an existing
debt by way of mortgage
V. Real Mortgage
Mortgage a contract whereby the debtor
secures to the creditor the fulfillment of a
principal obligation, immediately making
immovable property or real rights answerable
to the principal obligation in case it is not
complied with at the time stipulated.
A. OBJECTS OF REAL MORTGAGE
[Art. 2124]
1. Immovables
2. Alienable real rights over immovables.
Future property cannot be an object of
mortgage; however, a stipulation subjecting to
the mortgage improvements which the
mortgagor may subsequently acquire, install
or use in connection with real property already
mortgaged belonging to the mortgagor is
valid.
B. CHARACTERISTICS
(1) As a general rule, the mortgagor retains
possession of the property. He may deliver
said property to the mortgagee without
altering the nature of the contract of
mortgage.
(2) It is not an essential requisite that the
principal of the credit bears interest, or
that the interest as compensation for the
use of the principal and the enjoyment of
its fruits be in the form of a certain
percentage thereof.
(3) Mortgage creates an encumbrance over
the property, but ownership of the property
is not parted with. It merely restricts the
mortgagors jus disponendi over the
property. The mortgagor may still sell the
property, and any stipulation to the
contrary is void [Art. 2130]
(4) Mortgage extends to the natural
accessions, to the improvements of
growing fruits and the rents or income not
yet received when the obligation becomes
due, including indemnity from insurance,
and/or amount received from
expropriation for public use [Art. 2127]
(a) Applies only when the accessions and
accessories subsequently introduced
belongs to the mortgagor.
(b) To exclude them, there must be an
express stipulation, or the fruits must
be collected before the obligation
becomes due.
(c) Third persons who introduce
improvements upon the mortgaged
property may remove them at any time
C. KINDS
(1) Voluntary constituted by the will of the
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
442
owner of the property on which it is created
(2) Legal required by law to be executed in
favor of certain persons:
(a) Persons in whose favor the law
establishes a mortgage have no other
right than to demand the execution
and recording of the document in
which the mortgage is formalized
[Article 2125]
(b) The bondsman who is to be offered in
virtue of a provision of law or of a
judicial order shall have the
qualifications prescribed in Art 2056
[integrity, capacity to bind himself, and
sufficient property to answer for the
obligation], and in other laws [Article
2082
]
(c) If the person bound to give a bond
should not be able to do so, a pledge
or mortgage considered sufficient to
recover his obligation shall be
admitted in lieu thereof [Article 2083]
(3) Equitable One which, although lacking
the proper formalities of a mortgage,
shows the intention of the parties to make
the property a security for the debt.
(a) Lien created by equitable mortgage
ought not to be defeated by requiring
compliance with formalities necessary
to the validity of voluntary real estate
mortgage. Ex.: Pacto de retro
(b) Provisions governing equitable
mortgage: Arts. 1365, 1450, 1454,
1602, 1603, 1604 and 1607.
D. PRINCIPLE OF INDIVISIBILITY OF
PLEDGE/MORTGAGE
[Arts. 2089 to 2090]
A mortgage directly and immediately subjects
the property upon which it is imposed. It is
indivisible even though the debt may be
divided, and such indivisibility is likewise
unaffected by the fact that the debtors are not
solidarity liable. [Dayrit v. CA]
Where only a portion of the loan is released, the
mortgage becomes enforceable only as to the
proportionate value of the loan [Central Bank
v. CA
]
Indivisibility applies only as to
pledgors/mortgagors who are themselves
debtors in the principal obligation, and not to
accommodation pledgors/ mortgagors
When several things are pledged or mortgaged,
each thing for a determinate portion of the
debt, the pledges or mortgage, are considered
separate from each other. But when the
several things are given to secure the same
debt in its entirety, all of them are liable for the
debt, and the creditor does not have to divide
his action by distributing the debt among the
various things pledged or mortgaged. Even
when only a part of the debt remains unpaid,
all the things are still liable for such balance.
[Tolentino]
The question is whether or not the written
instrument in controversy was a mortgage or a
conditional sale. The correct test, where it can
be applied, is the continued existence of a debt
or liability between the parties. If such exists,
the conveyance may be held to be merely a
security for the debt or an indemnity against
the liability. [Reyes v. Sierra, 93 SCRA 473]
E. ESSENTIAL REQUISITES COMMON
TO PLEDGE AND MORTGAGE
(a) Constituted to secure the fulfillment of a
principal obligation.
(b) Pledgor or mortgagor must be the
absolute owner of the thing pledged or
mortgaged.
(c) The persons constituting the pledge or
mortgage have the free disposal of their
property, and in the absence thereof, that
they be legally authorized for the purpose.
Note: Third persons who are not parties to
the principal obligation may secure the
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
443
latter by pledging or mortgaging their own
property. [Art. 2085]
(d) Cannot exist without a valid obligation.
(e) Debtor retains the ownership of the thing
given as a security.
(f) When the principal obligation becomes
due, the thing pledged or mortgaged may
be alienated for the payment to the
creditor. [Art. 2087]
(g) Must be recorded in the Registry of
Property in order to be validly constituted.
Note: The mortgage would still be binding
between the parties even if the instrument
is not recorded.
F. FORECLOSURE OF MORTGAGE
Foreclosure is the remedy available to the
mortgagee by which he subjects the
mortgaged property to the satisfaction of the
obligation secured by the mortgage.
In general, an action for foreclosure of a
mortgage is limited to the amount mentioned
in the mortgage, except when the mortgage
contract intends to secure future loans or
advancements
Blanket Mortgage/Dragnet mortgage that
subsumes all debts of past or future origin
Mortgage may be used as a continuing
security which secures future advancements
and is not discharged by the repayment of the
amount in the mortgage
Alienation or assignment of mortgage credit is
valid even if it is not registered
Acceleration clause allowed
Acceleration clause, or the stipulation stating
that on the occasion of the mortgagors
default, the whole sum remaining unpaid
automatically becomes due and demandable,
is ALLOWED
Kinds of foreclosure
1. Judicial Foreclosure
2. Extrajudicial Foreclosure
Judicial Foreclosure vs. Extrajudicial
Foreclosure
Judicial Extrajudicial
Court intervenes No court intervention
There is equity of There is right of
redemption period redemption period
starts from the finality start from date of
of the judgment until registration of
order of confirmation certificate of sale
Decisions are
Not appealable
appealable
Special power of
No need for a special
attorney in favor of
power of attorney in
the mortgage is
the contract of
required in the
mortgage
contract

F.1. JUDICIAL FORECLOSURE

[Rule 68, Rules of Court]
(1) May be availed of by bringing an action in
the proper court which has jurisdiction over
the area wherein the real property involved
or a portion thereof is situated
(2) If the court finds the complaint to be wellfounded, it shall order the mortgagor to
pay the amount due with interest and
other charges within a period of not less
than 90 days nor more than 120 days from
the entry of judgment
(3) If the mortgagor fails to pay at time
directed, the court, upon motion, shall
order the property to be sold to the highest
bidder at a public auction.
(4) Upon confirmation of the sale by the court,
also upon motion, it shall operate to divest
the rights of all parties to the action and to
vest their rights to the purchaser subject to
such rights of redemption as may be
allowed by law
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
444
(5) Before the confirmation, the court retains
control of the proceedings; execution on
judgment
(6) The proceeds of the sale shall be applied
to the payment of the:
(a) costs of the sale;
(b) amount due the mortgagee;
(c) claims of junior encumbrancers or
persons holding subsequent
mortgages in the order of their priority;
and
(d) the balance, if any shall be paid to the
mortgagor
(7) Sheriffs certificate is executed,
acknowledged and recorded to complete
the foreclosure
Nature of judicial foreclosure proceedings
(1) Quasi in rem action. Hence, jurisdiction
may be acquired through publication.
(2) Foreclosure is only the result or incident of
the failure to pay debt.
(3) Survives death of mortgagor.
F.2. EXTRAJUDICIAL FORECLOSURE
[Act 3135]
(1) Applies to mortgages where the authority
to foreclose is granted to the mortgagee.
(2) Authority is not extinguished by death of
mortgagor or mortgagee. This is an agency
coupled with interest.
(3) Public sale should be made after proper
notice to the public, otherwise it is a
jurisdictional defect which could render the
sale voidable.
(4) There is no need to notify the mortgagor,
where there is no contractual stipulation
therefor.
Proper notice consists of:
(a) posting notice in three public places
and/or
(b) publication in newspaper of general
circulation
Purpose of notice is to obtain the best bid
for the foreclosed property
(5) Surplus proceeds of foreclosure sale
belong to the mortgagor.
(6) Debtor (who must be a natural person) has
the right to redeem the property sold
within 1 year from and after the date of
sale.
(a) If the mortgagee is a bank and the
debtor is a juridical person, then there
is no right of redemption. However, it
may redeem the property before the
registration of the TCT to the buyer,
which is similar to the equity of
redemption. The TCT must be
registered within three months after
the foreclosure.
(b) The mortgagor can only legally
transfer the right to redeem and the
use of the property during the period of
redemption.
(7) Remedy of party aggrieved by foreclosure
is a petition to set aside sale and the
cancellation of writ of possession.
However, if the mortgagee is a bank, the
mortgagor is required to post a bond equal
to the value of the mortgagees claim.
(8) Republication of the notice of sale is
necessary for the validity of the postponed
extrajudicial sale
(9) In foreclosure of real estate mortgage
under Act 3135, the buyer at auction may
petition the land registration court for a
writ of possession pending the one-year
period of redemption of the foreclosed
property.
F.4. NATURE OF POWER OF
FORECLOSURE BY EXTRAJUDICIAL SALE
(1) Conferred for mortgagees protection.
(2) An ancillary stipulation.
(3) A prerogative of the mortgagee.
Note:
(a) Both should be distinguished from
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
445
execution sale governed by Rule 39, ROC.
(b) Foreclosure retroacts to the date of
registration of mortgage.
(c) A stipulation of upset price, or the
minimum price at which the property shall
be sold to become operative in the event of
a foreclosure sale at public auction, is null
and void.
F.5. RIGHT OF MORTGAGEE TO
RECOVER DEFICIENCY
(1) Mortgagee is entitled to recover deficiency.
(2) If the deficiency is embodied in a
judgment, it is referred to as deficiency
judgment.
(3) Action for recovery of deficiency may be
filed even during redemption period.
(4) Action to recover prescribes after 10 years
from the time the right of action accrues.
F.6. EFFECT OF INADEQUACY OF PRICE
IN FORECLOSURE SALE
(1) Where there is right to redeem, inadequacy
of price is immaterial because the
judgment debtor may redeem the property.
Exception: Where the price is so
inadequate as to shock the conscience of
the court, taking into consideration the
peculiar circumstances.
(2) Property may be sold for less than its fair
market value, upon the theory that the
lesser the price the easier it is for the owner
to redeem.
(3) The value of the mortgaged property has
no bearing on the bid price at the public
auction, provided that the public auction
was regularly and honestly conducted.
A suit for the recovery of the deficiency after
the foreclosure of a mortgage is in the nature
of a mortgage action because its purpose is
precisely to enforce the mortgage contract.
[Caltex v. IAC, 176 SCRA 741]
G. WAIVER OF SECURITY BY
CREDITOR
(1) Mortgagee may waive the right to foreclose
his mortgage and maintain a personal
action for recovery of the indebtedness.
(2) Mortgagee cannot have both remedies.
This is because he only has one cause of
action, the non-payment of the mortgage
debt.
H. REDEMPTION
It is a transaction by which the mortgagor
reacquires the property which may have
passed under the mortgage or divests the
property of the lien which the mortgage may
have created
KINDS:
(1) Equity of redemption in judicial
foreclosure of real estate mortgage under
the ROC, it is the right of the mortgagor to
redeem the mortgaged property by paying
the secured debt within the 120 day period
from entry of judgment or after the
foreclosure sale, but before the sale of the
mortgaged property or confirmation of sale
A formal offer to redeem preserves the
right of redemption, e.g., by filing an action
to enforce the right to redeem
(2) Right of redemption in extrajudicial
foreclosure of real estate mortgage, the
right of the mortgagor to redeem the
property within a certain period after it was
sold for the satisfaction of the debt. (If the
mortgagee is a bank, the redemption
period expires after registration of the
sale.)
(a) For natural persons one year from
the registration of the TCT
(b) For juridical persons three months
from the foreclosure
(c) Formal offer to redeem must be with
tender of redemption price to preserve
right of redemption
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
446
Note: There is no right of redemption in pledge
and chattel mortgage.
The rule up to now is that the right of a
purchaser at a foreclosure sale is merely
inchoate until after the period of redemption
has expired without the right being exercised.
The title to land sold under mortgage
foreclosure remains, in the mortgagor or his
grantee until the expiration of the redemption
period and conveyance by the master's deed
[Medida v. CA]
VI. Antichresis
Antichresis a real security transaction that
arises by contract, with the antichretic creditor
acquiring the right to receive the fruits of an
immovable of the antichretic debtor, and the
obligation to apply them to the payment of the
interest, if owing, and thereafter to the
principal. [Art. 2132]
A. CHARACTERISTICS
(1) Accessory contract it secures the
performance of a principal obligation
(2) Formal contract it must be in a specified
form to be valid [Art. 2134]
B. SPECIAL REQUISITES
(1) It can cover only the fruits of an immovable
property
(2) Delivery of the immovable is necessary for
the creditor to receive the fruits, not to
make the contract binding
(3) Amount of principal and interest must be
specified in writing; otherwise, the
contract of antichresis shall be void
[Art.2134]
(4) Express agreement that debtor will give
possession of the property to creditor and
that the latter will apply the fruits to the
interest, if any, then to the principal of his
credit
Note: The obligation to pay interest is not the
essence of the contract of antichresis; there
being nothing in the Code to show that
antichresis is only applicable to securing the
payment of interest-bearing loans. On the
contrary, antichresis is susceptible of
guaranteeing all kinds of obligations, pure or
conditional.
C. AS DISTINGUISHED FROM OTHER
CONTRACTS
Antichresis Pledge
Kind of property
Real property Personal property
Perfection
Delivery of thing
Mere consent
pledged

Antichresis Real mortgage

Possession
Delivered to creditor Retained by debtor
Right to the fruits
Creditor acquires only Creditor does not
the right to receive have the right to
fruits receive fruits, but a
real right over the
 property is created
Payment of taxes and
charges
Creditor is generally Creditor has no
obliged to pay obligation to pay
Application of fruits
First applied to the
Mortgagee has no
payment of interest,
such obligation
and then to principal

D. OBLIGATIONS OF ANTICHRETIC
CREDITOR
(1) To pay taxes and charges on the estate,
including necessary expenses [Art.2135]
(a) The creditor may avoid said obligation
by:
(b) Compelling the debtor to reacquire
enjoyment of the property
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
447
(c) By stipulation to the contrary
(2) To apply all the fruits, after receiving them,
to the payment of interest, if owing, and
thereafter to the principal
(3) To render an account of the fruits to the
debtor
(4) To bear the expenses necessary for its
preservation and repair
E. REMEDIES OF CREDITOR IN CASE
OF NON-PAYMENT OF DEBT
(1) Action for specific performance
(2) Petition for the sale of the real property as
in a foreclosure of mortgage under Rule 68
of the Rules of Court [Art.2137]
(a) The parties, however, may agree on an
extrajudicial foreclosure in the same
manner as they are allowed in
contracts of mortgage and pledge
[Tavera v. El Hogar Filipino, Inc.; Art.
1939]
(b) A stipulation authorizing the
antichretic creditor to appropriate the
property upon the non-payment of the
debt within the agreed period is void
[Art. 2088]
Because of the right of the creditor to judicially
foreclose, antichresis is generally viewed as a
species of real estate mortgage, in which the
mortgagee retains possession of the collateral
and takes the fruits of the property in lieu of
interest on the debt. [Gomez-Somera]
VII. Chattel Mortgage
A conditional sale of personal property as
security for the payment of a debt, or the
performance of some other obligation
specified therein, the condition being that the
sale shall be void upon the seller paying to the
purchaser a sum of money or doing some other
act named. If the condition is performed
according to its terms, the mortgage and sale
immediately become void, and the mortgagee
is thereby divested of his title. [Section 3, Act
1508
]
It is a contract by virtue of which personal
property is recorded in the Chattel Mortgage
Register as a security for the performance of an
obligation. [Art. 2140]
A. CHARACTERISTICS
(1) It is an accessory contract because it
secures performance of a principal
obligation
(2) It is a formal contract because it requires
registration in the Chattel Mortgage
Register for its validity [but only as against
third persons]
(3) It is a unilateral contract because it
produces only obligations on the part of
the creditor to free the thing from the
encumbrance on fulfillment of the
obligation.
(4) The excess of the proceeds of the sale goes
to the debtor or mortgagor
(5) Creditor or mortgagee can recover
deficiency from the debtor or mortgagor,
except if covered by the Recto Law
B. OBLIGATIONS SECURED
A chattel mortgage can only cover obligations
existing at the time the mortgage is
constituted. It cannot secure after-incurred
obligations even if these future debts are
accurately described.
An increase or extension of the chattel
mortgage obligation becomes a new chattel
mortgage in itself. Although a contract TO
mortgage that includes future debts is a
binding commitment, the contract OF chattel
mortgage itself is not perfected until after an
agreement covering the newly contracted debt
is executed. [Gomez-Somera]
C. PROPERTIES COVERED
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
448
Generally, only personal or movable property
can be covered by a chattel mortgage.
However, the parties may agree to treat real
property as personal property for purposes of
executing a chattel mortgage. There must be a
description of the property as would enable the
parties or other persons to identify the same
after reasonable investigation and inquiry.
D. VALIDITY OF CHATTEL
MORTGAGE
Chattel mortgage shall not be valid against
any person except the mortgagor, his
executors or administrators unless:
(1) The possession of the property is delivered
to and retained by the mortgagee or
(2) The mortgage is recorded. [Sec. 4, Act
1508
]
E. FORMAL REQUISITES
(1) It should substantially comply with the
form prescribed by law
(2) It should be signed by the person/s
executing the same in the presence of two
witnesses who shall sign the mortgage as
witnesses to the execution thereof and
(3) Each mortgagor and mortgagee or, in the
absence of the mortgagee, his agent or
attorney, shall make and subscribe an
affidavit in the form prescribed by law,
which affidavit, signed by the parties to the
mortgage and the two witnesses and the
certificate of the oath signed by the person
authorized to administer an oath shall be
appended to such mortgage and recorded
therewith. [Sec. 5, Act 1508]
F. REGISTRATION OF CHATTEL
MORTGAGE
F.1. PERIOD
There is substantial and sufficient compliance
with the law when registration is made by the
mortgagee before the mortgagor has complied
with his principal obligation, and no right of
innocent third persons is prejudiced.
F.2. VENUE
If the mortgagor resides in the Philippines in
the office of the register of deeds of the
province in which the mortgagor resides at the
time of the making of the chattel mortgage
If the mortgagor does not reside in the
Philippines in the province in which the
property is situated
If the property is located in a different province
registration in both provinces is required
F.3. EFFECT
(1) Creates real rights which follows the
chattel
(2) It is an effective and binding notice to other
creditors
(3) Registration gives the mortgagee
symbolical possession
Affidavit of good faith is required, and it states
that the chattel mortgage is
(1) Made solely for the purpose of securing the
obligation specified in the chattel
mortgage, and
(2) The principal obligation is a just and valid
obligation, and one not entered into for the
purpose of fraud
The effect of absence of affidavit of good faith
is that the chattel mortgage is vitiated only as
against third persons without notice
Effect of failure to register in the Chattel
Mortgage Registry
The mortgage is binding between the parties.
However, the right of the person in whose favor
the law establishes a mortgage is to demand
the execution and the recording of the
instrument.
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
449
Registration of assignment of mortgage not
required
A chattel mortgage may be alienated or
assigned to a third person
The debtor is protected if he pays his creditor
without actual knowledge that the debt has
been assigned
Failure of mortgagee to discharge the
mortgage
If the mortgagee, assign, administrator,
executor, or either of them,
(1) After performance of the condition before
or after the breach thereof, or
(2) After tender of the performance of the
condition, at or after the time fixed for the
performance,
does not within ten days after being requested
thereto by any person entitled to redeem,
discharge the mortgage in the manner
provided by law, the person entitled to redeem
may recover of the person whose duty it is to
discharge the same, twenty pesos for his
neglect and all damages occasioned thereby in
an action in any court having jurisdiction of the
subject-matter thereof. [Act 1508, Sec. 8]
When the condition of the chattel mortgage is
broken, a mortgagor or person holding a
subsequent mortgage, or a subsequent
attaching creditor may redeem the same by
paying or delivering to the mortgagee the
amount due on such mortgage and the
reasonable costs and expenses incurred by
such breach of condition before the sale
thereof. An attaching creditor who so redeems
shall be subrogated to the rights of the
mortgagee and entitled to foreclose the
mortgage in the same manner that the
mortgagee could foreclose it.
G. FORECLOSURE
The mortgagee, his executor, administrator or
assign may cause the mortgaged property or
any part thereof to be sold at a public auction
by a public officer:
(1) After 30 days from the time of condition
broken
(2) At a public place in the municipality where
the mortgagor resides, or where the
property is situated
(3) Provided at least 10 day-notice of the time,
place, and purpose of such sale has been
posted at 2 or more public places in such
municipality, and
(4) The mortgagee, his executor,
administrator, or assign shall notify the
mortgagor or person holding under him
and the persons holding subsequent
mortgages of the time and place of sale at
least 10 days previous to the sale:
(a) Either by notice in writing directed to
him or left at his abode, if within the
municipality, or
(b) Sent by mail if he does not reside in
such municipality
DISPOSITION OF PROCEEDS
The proceeds of the sale shall be applied to the
payment:
(1) Costs and expenses of keeping and sale
(2) Payment of the obligation secured by the
mortgage
(3) The residue shall be paid to persons
holding subsequent mortgages in their
order
(4) The balance shall be paid to the mortgagor
or person holding under him on demand
VIII. Quasi-Contracts
A quasi-contract is that juridical relation
resulting from a lawful, voluntary and
unilateral act, and which has for its purpose
the payment of indemnity to the end that no
one shall be unjustly enriched or benefited at
the expense of another [Art. 2142]
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
450
A. NEGOTIORUM GESTIO (UNAUTHORIZED
MANAGEMENT)
Negotiorum gestio takes place when a
person voluntarily takes charge of anothers
abandoned business or property without the
owners authority [Art. 2144]. Reimbursement
must be made to the gestor (i.e., one who
carried out the business) for necessary and
useful expenses, as a rule.
The obligation does not arise:
(1) When the property or business is not
neglected or abandoned;
(2) If in fact the manager has been tacitly
authorized by the owner.
In the first case, the provisions of Articles 1317,
1403, No. 1, and 1404 regarding unauthorized
contracts shall govern.
In the second case, the rules on agency in Title
X of this Book shall be applicable. [Art. 2144]
A.1. OBLIGATIONS OF A GESTOR
(1) Perform his duties with all the diligence of
a good father of a family
(2) Pay the damages which through his fault
and negligence may be suffered by the
owner of the property/business under his
management [Art. 2145]
(3) Be liable for the acts of the persons to
whom he delegated all or some of his
duties. This is without prejudice to the
direct obligation of the delegate to the
owner of the business. [Art. 2146]
(4) Be liable for any fortuitous event under the
following conditions:
(a) If he undertakes risky operations which
the owner was not accustomed to
embark upon
(b) If he has preferred his own interest to
that of the owner
(c) If he fails to return the property or
business after demand of the owner
(d) If he assumed management in bad
faith [Art. 2147]
(e) If he is manifestly unfit to carry on the
management
(f) If by his intervention he prevented a
more competent person from taking up
the management. [Art. 2148]
Note: The gestor shall not be liable for (e)
and (f) if the management was assumed to
save the property or business from
imminent danger.
(5) Be personally liable for contracts which he
entered into with third persons, even
though he acted in the name of the owner,
and there shall be no right of action
between the owner and third persons.
The gestor shall not be personally liable for
such contracts, provided:
(a) The owner has expressly or tacitly
ratified the management, or
(b) When the contract refers to things
pertaining to the owner of the
business. [Art. 2152]
Note: The responsibility of two or more
gestors shall be solidary, unless the
management was assumed to save the
thing or business from imminent danger.
A.2. OBLIGATIONS OF THE OWNER OF
THE PROPERTY OR BUSINESS
Although the management was not expressly
ratified, the owner who enjoys the advantages
of the same shall:
(a) Be liable for the obligations incurred in his
interest
(b) Reimburse the gestor for the necessary
and useful expenses and for the damages
the latter may have suffered in the
performance of his duties
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
451
The above obligations shall be incumbent
upon the owner if the management had for its
purpose the prevention of an imminent and
manifest loss, although no benefit may have
been derived. [Art. 2150]
If the owner did not derive any benefit and
there was no imminent and manifest danger to
the property or business, the owner would still
be liable for the abovementioned obligations
and expenses, provided:
(5) The gestor has acted in good faith; and
(6) The property or business is intact, ready to
be returned to the owner. [Art. 2151]
A.3. EFFECT OF RATIFICATION
The ratification of the management by the
owner of the business produces the effects of
an express agency, even if the business may
not have been successful. [Art. 2149]
A.4. EXTINGUISHMENT OF
MANAGEMENT
(1) When the owner repudiates or puts an end
thereto
(2) When the gestor withdraws from the
management, subject to Art. 2144
(3) By the death, civil interdiction, insanity or
insolvency of the owner or the gestor. [Art.
2153
]
B. SOLUTIO INDEBITI (UNDUE
PAYMENT)
Solution indebiti takes place when something
is received when there is no right to demand it,
and it was unduly delivered through mistake.
The recipient has the duty to return it [ Art.
2154
].
This situation covers payment by reason of a
mistake in the construction or application of a
doubtful or difficult question of law [Art. 2155]
WHEN DEBT NOT YET DUE
If the payer was in doubt whether the debt was
due, he may recover if he proves that it was not
due. [Art. 2156]
RESPONSIBILITY OF TWO OR MORE
PAYEES
When there has been payment of what is not
due, their responsibility is solidary.
WHEN MONEY OR THING DELIVERED IS
OWNED BY THIRD PERSON
The payee cannot demand that the payor
prove his ownership of the thing delivered.
Nevertheless, should he discover that the thing
has been stolen and who its true owner is, he
must advise the latter.
If the owner, in spite of such information, does
not claim it within the period of one month, the
payee shall be relieved of all responsibility by
returning the thing deposited to the payor.
If the payee has reasonable grounds to believe
that the thing has not been lawfully acquired
by the payor, the former may return the same.
[Art. 2158]
LIABILITY OF PAYEE
If in bad faith, he shall be liable:
(1) For legal interest if a sum of money is
involved, or
(2) For the fruits received or which should
have been received if the thing produces
fruits, and
(3) For any loss or impairment of the thing for
any cause, and
(4) For damages to the person who delivered
the thing, until it is recovered. [Art. 2159]
If in good faith, he shall be liable:
(1) For the impairment or loss of the thing
certain and determinable or its accessories
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
452
and accessions insofar as he has thereby
been benefited.
(2) For the return of the price or assign the
action to collect the sum if he has
alienated the same. [Art. 2160]
EXEMPTION FROM THE OBLIGATION TO
RESTORE THE PAYMENT UNDULY MADE
A person who, believing in good faith that the
payment was being made of a legitimate and
subsisting claim,
(1) destroyed the document, or
(2) allowed the action to prescribe, or
(3) gave up the pledges, or
(4) cancelled the guaranties for his right shall
be exempt from the obligation to restore.
The person who paid unduly may proceed only
against the true debtor or the guarantors with
regard to whom the action is still effective.
[Art. 2162]
PRESUMPTION OF PAYMENT BY
MISTAKE, DEFENSE
The presumption arises if something which
had never been due or had already been paid
was delivered; but he from whom the return is
claimed may prove that the delivery was made
out of liberality or for any other just cause.
C. OTHER QUASI-CONTRACTS
(1) When, without the knowledge of the
person obliged to give support, it is given
by a stranger, the latter shall have a right
to claim the same from the former, unless
it appears that he gave it out of piety and
without intention of being repaid. [Art.
2164]
(2) When funeral expenses are borne by a
third person, without the knowledge of
those relatives who were obliged to give
support to the deceased, said relatives
shall reimburse the third person, should
the latter claim reimbursement. [Art. 2165]
(3) When the person obliged to support an
orphan, or an insane or other indigent
person unjustly refuses to give support to
the latter, any third person may furnish
support to the needy individual, with right
of reimbursement from the person obliged
to give support. The provisions of this
article apply when the father or mother of
a child under eighteen years of age
unjustly refuses to support him. [Art. 2166]
(4) When through an accident or other cause a
person is injured or becomes seriously ill,
and he is treated or helped while he is not
in a condition to give consent to a contract,
he shall be liable to pay for the services of
the physician or other person aiding him,
unless the service has been rendered out of
pure generosity. [Art. 2167]
(5) When during a fire, flood, storm, or other
calamity, property is saved from
destruction by another person without the
knowledge of the owner, the latter is
bound to pay the former just
compensation. [Art. 2168]
(6) When the government, upon the failure of
any person to comply with health or safety
regulations concerning property,
undertakes to do the necessary work, even
over his objection, he shall be liable to pay
the expenses. [Art. 2169]
(7) When by accident or other fortuitous event,
movables separately pertaining to two or
more persons are commingled or confused,
the rules on co-ownership shall be
applicable. [Art. 2170]
(8) The rights and obligations of the finder of
lost personal property shall be governed by
Articles 719 and 720. [Art. 2171]
(9) The right of every possessor in good faith
to reimbursement for necessary and useful
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
453
expenses is governed by Article 546. [Art.
2172]
(10)When a third person, without the
knowledge of the debtor, pays the debt,
the rights of the former are governed by
Articles 1236 and 1237. [Art. 2173]
(11) When in a small community a nationality
of the inhabitants of age decide upon a
measure for protection against
lawlessness, fire, flood, storm or other
calamity, any one who objects to the plan
and refuses to contribute to the expenses
but is benefited by the project as executed
shall be liable to pay his share of said
expenses. [Art. 2174]
(12) Any person who is constrained to pay the
taxes of another shall be entitled to
reimbursement from the latter. [Art. 2175]
IX. Concurrence and
Preference of Credits
Concurrence of credits implies possession by
two or more creditors of equal rights or
privileges over the same property or all of the
property of the debtor.
Preference of credits is the right held by a
creditor to be preferred in the payment of his
claim above others out of the debtors assets.
Preference is merely a method adopted to
determine and specify the order in which
credits should be paid, as opposed to a lien,
which creates a charge on a particular
property. [DBP v. NLRC (1990)]
A. WHEN RULES ON PREFERENCE
ARE APPLICABLE
(1) There are two or more creditors
(2) With separate and distinct claims
(3) Against the same debtor
(4) Who has insufficient property AND
(5) Is insolvent
B. CLASSIFICATION OF CREDITS
(1) Special Preferred Credits
(a) These are considered as mortgages or
pledges of real or personal property, or
liens within the purview of legal
provisions governing insolvency. [NCC
2243
]
(b) Taxes in NCC 2241 and 2242 shall first
be satisfied. [NCC 2243] Only taxes
enjoy a preference; for all other claims,
there is only a concurrence of credits.
[Gomez-Somera]
(c) They exclude all other claims to the
extent of the value of the affected
property.
(d) These take precedence over ordinary
preferred credits insofar as the
property, to which the liens attach, is
concerned. [Gomez-Somera]
(e) Pro-rating total amount to be paid is
equal to:
Credit
------------------ x value of property
Total amount of
concurring
debts
(2) Ordinary Preferred Credits
(a) These enjoy a preference, excluding
the credits that are later in order, but
only as against the value of the
property not otherwise subjected to
any special preferred credit. [GomezSomera
]
(b) NCC 2244 does not create a lien on
specific property; rather, it create
rights in favor of certain creditors to
have the free property of the debtor
applied in accordance with an order of
preference.
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
454
(3) Common Credits
These enjoy no preference, and there is only a
concurrence of credits, which must be paid pro
rata regardless of dates [NCC 2245, 2251].
B.1. SPECIAL PREFERRED CREDITS ON
SPECIFIC MOVABLE PROPERTY
Art. 2241. With
reference to specific
movable
property of the debtor,
the following claims or
liens shall be preferred:
(1) Duties, taxes and
fees due thereon to the
State or any subdivision
thereof;
(2) Claims arising from
misappropriation,
breach of trust, or
malfeasance by public
officials committed in
the performance of
their duties, on the
movables, money or
securities obtained by
them;
(3) Claims for the unpaid
price of movables
sold, on said movables,
so long as they are
in the possession of the
debtor, up to the
value of the same; and if
the movable has
been resold by the
debtor and the price is
still unpaid, the lien may
be enforced on
the price; this right is
not lost by the
immobilization of the
thing by destination,
provided it has not lost
its form, substance
and identity; neither is
the right lost by the
sale of the thing
together with other
property for a lump sum,
when the price
thereof can be
determined
proportionally;
(4) Credits guaranteed
with a pledge so long
as the things pledged
are in the hands of
the creditor, or those
guaranteed by a
chattel mortgage, upon
the things pledged
or mortgaged, up to the
value thereof;
(5) Credits for the
making, repair,
safekeeping
or preservation of
personal property, on
the movable thus made,
repaired, kept or
possessed;
(6) Claims for laborers'
wages, on the goods
manufactured or the
work done;
(7) For expenses of
salvage, upon the goods
salvaged;
(8) Credits between the
landlord and the
tenant, arising from the
contract of
tenancy on shares, on
the share of each in
the fruits or harvest;
(9) Credits for
transportation, upon the
goods
carried, for the price of
the contract and

incidental expenses,
until their delivery and
for thirty days
thereafter;
(10)Credits for lodging
and supplies usually
furnished to travellers by
hotel keepers, on
the movables belonging
to the guest as
long as such movables
are in the hotel, but
not for money loaned to
the guests;
(11) Credits for seeds
and expenses for
cultivation and harvest
advanced to the
debtor, upon the fruits
harvested;
(12) Credits for rent for
one year, upon the
personal property of the
lessee existing on
the immovable leased
and on the fruits of
the same, but not on
money or instruments
of credit;
(13) Claims in favor of
the depositor if the
depositary has
wrongfully sold the thing
deposited, upon the
price of the sale.
In the foregoing cases, if
the movables to
which the lien or
preference attaches
have
been wrongfully taken,
the creditor may
demand them from any
possessor, within thirty
days from the unlawful
seizure.

B.2. SPECIAL PREFERRED CREDITS ON

SPECIFIC IMMOVABLE PROPERTY AND
REAL RIGHTS
Art. 2242. With
reference to specific
immovable property and
real rights of the
debtor, the following
claims, mortgages and
liens shall be preferred,
and shall constitute an
encumbrance on the
immovable or real right:
(1) Taxes due upon the
land or building;
(2) For the unpaid price
of real property sold,
upon the immovable
sold;
(3) Claims of laborers,
masons, mechanics and
other workmen, as well
as of architects,
engineers and
contractors, engaged in
the
construction,
reconstruction or repair
of
buildings, canals or
other works, upon said
buildings, canals or
other works;
(4) Claims of furnishers
of materials used in
the construction,
reconstruction, or repair
of buildings, canals or
other works, upon
said buildings, canals or
other works;
(5) Mortgage credits
recorded in the Registry
of Property, upon the
real estate
mortgaged;
(6) Expenses for the
preservation or
improvement of real
property when the law
authorizes
reimbursement, upon
the

UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW

455
immovable preserved or
improved;
(7) Credits annotated in
the Registry of
Property, in virtue of a
judicial order, by
attachments or
executions, upon the
property affected, and
only as to later
credits;
(8) Claims of co-heirs for
warranty in the
partition of an
immovable among them,
upon the real property
thus divided;
(9) Claims of donors or
real property for
pecuniary charges or
other conditions
imposed upon the
donee, upon the
immovable donated;
(10)Credits of insurers,
upon the property
insured, for the
insurance premium for
two
years.

B.3. ORDINARY PREFERRED CREDITS

Art 2244. With reference
to other property, real
and personal, of the
debtor, the following
claims or credits shall be
preferred in the order
named:
(1) Proper funeral
expenses for the debtor,
or
children under his or her
parental authority
who have no property of
their own, when
approved by the court;
(2) Credits for services
rendered the insolvent
by employees, laborers,
or household
helpers for one year
preceding the
commencement of the
proceedings in
insolvency;
(3) Expenses during the
last illness of the
debtor or of his or her
spouse and children
under his or her parental
authority, if they
have no property of their
own;
(4) Compensation due
the laborers or their
dependents under laws
providing for
indemnity for damages
in cases of labor
accident, or illness
resulting from the
nature of the
employment;
(5) Credits and
advancements made to
the
debtor for support of
himself or herself,
and family, during the
last year preceding
the insolvency;
(6) Support during the
insolvency
proceedings, and for
three months
thereafter;
(7) Fines and civil
indemnification arising
from
a criminal offense;
(8) Legal expenses, and
expenses incurred in
the administration of the
insolvent's estate

for the common interest

of the creditors,
when properly
authorized and approved
by
the court;
(9) Taxes and
assessments due the
national
government, other than
those mentioned
in Articles 2241, No. 1,
and 2242, No. 1;
(10)Taxes and
assessments due any
province,
other than those
referred to in Articles
2241, No. 1, and 2242,
No. 1;
(11) Taxes and
assessments due any
city or
municipality, other than
those indicated in
Articles 2241, No. 1, and
2242, No. 1;
(12) Damages for death
or personal injuries
caused by a quasi-delict;
(13) Gifts due to public
and private institutions
of charity or
beneficence;
(14) Credits which,
without special privilege,
appear in [a] a public
instrument; or (b) in
a final judgment, if they
have been the
subject of litigation.
These credits shall
have preference among
themselves in the
order of priority of the
dates of the
instruments and of the
judgments,
respectively.

Worker preference in case of bankruptcy

PD 442 Labor Code, as
amended, Art. 110. In
the event of bankruptcy
or liquidation of an
employers business, his
workers shall enjoy
first preference as
regards their wages and
other monetary claims,
any provisions of law to
the contrary
notwithstanding. Such
unpaid
wages and monetary
claims shall be paid in
full before claims of the
government and other
creditors may be paid.

B.4. COMMON CREDITS

Art. 2245. Credits of
any other kind or class,
or
by any other right or
title not comprised in
the
four preceding articles,
shall enjoy no
preference.

C. ORDER OF PREFERENCE OF
CREDITS
(1) Credits which enjoy preference with respect
to specific movables exclude all others to
the extent of the value of the personal
property to which the preference refers
[Art.2246].
UP LAW BOC CREDIT TRANSACTIONS CIVIL LAW
456
(2) If there are two or more credits with
respect to the same specific movable
property, they shall be satisfied pro rata,
after the payment of duties, taxes and fees
due the State or any subdivision thereof
[Art.2247]
(3) Those credits which enjoy preference in
relation to specific real property or real
rights exclude all others to the extent of
the value of the immovable or real right to
which the preference refers [Art.2248].
(4) If there are two or more credits with
respect to the same specific real property
or real rights, they shall be satisfied pro
rata, after the payment of the taxes and
assessment of the taxes and assessments
upon the immovable property or real right
[Art. 2249].
(5) The excess, if any, after the payment of the
credits which enjoy preference with respect
to specific property, real or personal, shall
be added to the free property which the
debtor may have, for the payment of other
credits [Art.2250].
(6) Those credits which do not enjoy any
preference with respect to specific
property, and those which enjoy
preference, as to the amount not paid,
shall be satisfied according to the
following rules:
(a) Order established by NCC 2244
(b) Common credits referred to in NCC
2245 shall be paid pro rata regardless
of dates [Art.2251].
D. EXEMPT PROPERTY
(1) Present property
(a) Family home [Arts. 152, 153 and 155]
(b) Right to receive support, as well as
money or property obtained by such
support, shall not be levied upon on
attachment or execution. [Art. 205]
(c) Rule 39, Sec. 13
(d) Sec 118, Public Land Act [CA 141, as
amended
]
(2) Future property:
(a) A debtor who obtains a discharge from
his debts on account of insolvency, is
not liable for the unsatisfied claims of
his creditors with said property [Sec.
68 and 69, Insolvency Law, Act 1956]
(3) Property in custodia legis and of public
dominion
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
457

CIVIL LAW
LAND, TITLES, &
DEEDS
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
458
I. Torrens System
Land Title It is the evidence of the right of the
owner or the extent of his interest, by which he
can maintain control, and as a rule, assert right
to exclusive possession and enjoyment of the
property. [Pena, Registration of Land Titles
and Deeds, p. 3]
Title and Certificate of Title Distinguished
Title Certificate of Title
Definition
Lawful cause or
ground of possessing
that which is ours.
It is a mere evidence
That which
of ownership; it is not
constitutes a just
the title to the land
cause of exclusive
itself.1
possession, or which
is the foundation of
ownership of property.

Deed A written instrument executed in

accordance with law, wherein a person grants
or conveys to another certain land, tenements
or hereditaments.
ELEMENTS OF A DEED:
(a) Grantor
(b) Grantee
(c) Words of Grant
(d) Description of the property involved
(e) Signature of the grantor
(f) At least two (2) witnesses
(g) Notarial acknowledgment
Estate An estate, strictly speaking,
represents the nature, extent, degree, and
quantity of a persons interest in land.
TYPES OF ESTATE:
(1) Freehold Estate Indicates title of
ownership
1 Castillo v. Escutin
(a) Fee Simple An absolute title in
perpetuity; Title to land is conferred
upon a man and his heirs absolutely
and without any limitation imposed
upon the estate
(b) Fee Tail One designed to pass title
from grantee to his heirs, in the intent
of the grantor being to keep the
property in the grantees line of issue
(c) Life Estate One held for the duration
of the life of the grantee; In some
cases, it may terminate earlier as by
forfeiture
(2) Less-than-Freehold Estate Signifies some
sort of right short of title
(a) Estate for Years In the nature of a
lease; grantee or lessee takes over
possession of the land for a period
agreed upon but the grantor retains
the legal title to the property
(b) Tenancy from period to period Also in
the nature of a lease which may run
from month to month or from year to
year, with the peculiarity of automatic
renewal from time to time, unless
expressly terminated by either party
(c) Tenancy at will Another form of lease
agreement where a person is permitted
to occupy the land of another without
any stipulation as to period, but either
party reserves the right to terminate
the occupation at will or at any time
Land Registration A judicial or administrative
proceeding whereby a persons claim of
ownership over a particular land is determined
and confirmed or recognized so that such land
and the ownership thereof may be recorded in
a public registry.
Nature of Land Registration Judicial
proceedings for the registration of lands
throughout the Philippines shall be in Rem
and shall be based on the generally accepted
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
459
principles underlying the Torrens system [Sec.
2, par. 1, PD 1529]
It is therefore binding on the whole world
because by the description in the notice (of
initial hearing of the application for
registration) To Whom It May Concern, all
the world are made parties defendant.
[Aquino, Land Registration and Related
Proceedings, p. 3, citing Esconde v. Borlongay,
152 SCRA 603, 1987]
A. LAWS IMPLEMENTING LAND
REGISTRATION
(1) Property Registration Decree [PD 1529, as
amended]
(2) Cadastral Act [Act 2259, as amended]
(3) Public Land Act [CA 141, as amended]
(4) Emancipation Decree [PD 27, as amended]
(5) Comprehensive Agrarian Reform Law of
1988 [RA 6657, as amended]
(6) Indigenous Peoples Rights Act of 1997
[RA 8371]
To simplify and streamline land registration
proceedings, Presidential Decree No. 1529 was
issued on June 11, 1978, otherwise known as the
Property Registration Decree, governing
registration of lands under the Torrens system
as well as the recording of transactions
relating to unregistered lands, including
chattel mortgages. This Decree consolidates,
in effect, all pre-existing laws on property
registration with such appropriate
modifications as are called for by existing
circumstances. [Pena, p. 9]
B. PURPOSES OF LAND
REGISTRATION
(1) To notify and protect the interests of
strangers to a given transaction, who may
be ignorant thereof [Sapto, et al. v.
Fabiana, 103 Phil. 683, 1958]
(2) As held in Legarda v. Saleeby [31 Phil. 590
(1915)]
(a) To quiet title to the land and to stop
forever any question as to the legality
of said title
(b) To relieve the land of unknown claims
(c) To guarantee the integrity of land titles
and to protect their indefeasibility once
the claim of ownership is established
and recognized
(d) To give every registered owner
complete peace of mind
(e) To issue a certificate of title to the
owner which shall be the best evidence
of his ownership of the land
(f) To avoid conflicts of title in and to real
estate and to facilitate transactions
(3) As held in Capitol Subdivisions, Inc. v.
Province of Negros Occidental [7 SCRA 60
(1963)]
(a) To avoid possible conflicts of title in
and to real property, and
(b) To facilitate transactions relative
thereto by giving the public the right to
rely upon the face of the Torrents
certificate of title and to dispense with
the need of inquiring further
Object of Registration Only real property or
real rights may be the object of registration
under the existing land registration laws.
CLASSIFICATION OF LANDS:
(1) Private or public
(2) Alienable or inalienable
(3) Registered or unregistered
(4) Registrable or Non-registrable
Registrable lands are:
(1) Alienable public agricultural lands,
If in the public domain, the land must
be classified as alienable and
disposable. It must be classified as
such at the time of filing the
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
460
application for registration. [Republic v.
CA and Naguit, 2005]
(2) Private lands
Non-registrable lands - those found in the Civil
Code dealing with non-registrable properties
(e.g. property of public dominion)
Torrens System - A system for registration of
land under which, upon landowners
application, the court may, after appropriate
proceedings, direct the issuance of a certificate
of title. [Blacks Law Dictionary]
The boldest effort to grapple with the problem
of simplification of title to land was made by
Mr. (afterwards Sir Robert) Torrens, a layman,
in South Australia in 1857. . . . In the Torrens
system title by registration takes the place of
"title by deeds" of the system under the
"general" law. A sale of land, for example, is
effected by a registered transfer, upon which a
certificate of title is issued. The certificate is
guaranteed by statute, and, with certain
exceptions, constitutes indefeasible title to the
land mentioned therein. The object of the
Torrens system, them, is to do away with the
delay, uncertainty, and expense of the old
conveyancing system.
The Torrens system was introduced in the
Philippines by Act No. 496, which took effect
on Jan. 1, 1903. This was later amended and
superseded by PD 1529 which took effect on
June 11, 1978.
The underlying principle of the Torrens system
is security with facility in dealing with land.
This is made possible by defining the absolute
status of a given property in a certificate of title
with a governmental and universal guaranty.
This certificate of title should better be known
as certificate of title and encumbrances. In the
words of Torrens himself the main objects are
to simplify, quicken, and cheapen the transfer
of real estate and to render title safe and
indefeasible. [The Philippine Torrens System
by Florencio Ponce 1964
]
By "Torrens" system generally are meant those
systems of registration of transactions with
interest in land whose declared object is, under
governmental authority, to establish and
certify to the ownership of an absolute and
indefeasible title to realty, and to simplify its
transfer. [Grey-Alba v. Dela Cruz, GR No. L-
524]
ADVANTAGES
(1) Secures title
(2) Protection against fraud
(3) Simplified dealings
(4) Restoration of the estates to its just value,
whose depreciation is caused by some blur,
technical defect
(5) Barred the recurrence of faults in the title
[Legarda v. Saleeby]
Nature: Judicial in nature.
Purpose: The real purpose of the Torrens
system of registration is to quiet title to land;
to put a stop forever to any question of the
legality of the registration, in the certificate, or
which may arise subsequent thereto. [Pena, p.
47
]
C. ADMINISTRATION OF THE
TORRENS SYSTEM
(1) Land Registration Authority
The agency charged with the efficient
execution of the laws relative to the
registration of lands
Under the executive supervision of the
DOJ
Consists of an Administrator assisted by
2 Deputy Administrators
(2) Register of Deeds
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
461
Constitutes a public repository of
records of instruments affecting
registered or unregistered lands and
chattel mortgages in the province or city
wherein such office is situated
Headed by the Register of Deeds,
assisted by a Deputy
CERTIFICATE OF TITLE
The Torrens Title Certificate of ownership
issued by the Register of Deeds naming and
declaring the owner of the real property
described therein free from all liens and
encumbrances, except such as may be
expressly noted thereon or otherwise reserved
by law
(1) Original Certificate of Title (OCT) it is the
first certificate of title issued in the name
of the registered owner by the Register of
Deeds covering a parcel of land which had
been registered under the Torrens
System, by virtue of judicial or
administrative proceedings
(2) Transfer Certificate of Title (TCT) the
subsequent certificate of title pursuant to
any deed of transfer or conveyance to
another person. The Register of Deeds
shall make a new certificate of title and
give the registrant an owners duplicate
certificate. The previous certificate shall
be stamped cancelled.
(3) Patents Whenever public land is by the
Government alienated, granted or
conveyed to any person, the same shall be
brought forthwith under the operation of
this Decree [PD 1529, Sec. 103, par. 1]
(a) Patents only involve public lands
which are alienated by the
Government pursuant to the Public
Land Act (CA 141, as amended]
(b) The patent (even if denominated as
deed of conveyance) is not really a
conveyance but a contract between
the grantee and the Government and
evidence of authority to the Register
of Deeds to make registration.
(c) The act of registration is the operative
act to affect and convey the land.
Probative Value: A Torrens Certificate of Title is
valid and enforceable against the whole world.
It may be received in evidence in all courts of
the Philippines, and shall be conclusive as to
all matters contained therein, principally the
identity of the owner of the covered land
thereby and identity of the land.
A Torrens title, once registered, cannot be
defeated, even by adverse, open and notorious
possession. A registered title under the
Torrens system cannot be defeated by
prescription. The title, once registered, is
notice to the whole world. All persons must
take notice. No one can plead ignorance of the
registration. [Egao v. CA, 1989]
D. EFFECT OF REGISTRATION
UNDER THE TORRENS SYSTEM
(1) Land is placed under the operation of the
Torrens system
(2) Claims and liens of whatever character
existing against the land prior to the
issuance of the certificate of title are cut off
by such certificate and the certificate so
issued binds the whole world, including the
government
(a) It is an elemental rule that a decree of
registration bars all claims and rights
which arose or may have existed prior
to the decree of registration. By the
issuance of the decree, the land is
bound and title thereto quieted,
subject only to certain exceptions
under the property registration decree.
[Heirs of Alejandra Delfin, namely,
Leopoldo Delfin, et al. v. Avelina
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
462
Rabadon, G.R. No. 165014, July 31,
2013]
(b) Exceptions:
(i) Those claims noted on the
certificate
(ii) Liens, claims, or rights arising or
existing under the laws and the
Constitution, which are not by law
required to appear on record in the
Register in order to be valid
(iii) Unpaid real estate taxes levied and
assessed within 2 years
immediately preceding the
acquisition of any right over the
land by an innocent purchaser for
value
(3) Title to the land becomes non-prescriptible
(a) Even adverse, notorious, and
continuous possession under claim of
ownership for the period fixed by law is
ineffective against a Torrens title [JM
Tuason and Co. Inc. v. CA, 1979]
(b) The fact that the title to the land was
lost does not mean that the land
ceased to be registered land before the
reconstitution of its title. It cannot
perforce be acquired by prescription.
[Ruiz v. CA, 1977]
(4) Land becomes incontrovertible and
indefeasible. A decree of registration and
registered title cannot be impugned,
enlarged, altered, modified, or diminished
either in collateral or direct proceeding
after the lapse of the 1-year period
prescribed by the law.
(a) Exceptions:
(i) If previous valid title of the same
land exists
(ii) When the land covered is not
capable of registration
(iii) When acquisition of certificate is
attended by fraud
(5) Torrens certificate is presumed valid and
devoid of flaws.
Note: Registration is not equivalent to legal
title
Under the Torrens system, registration only
gives validity to the transaction or creates a
lien upon the land. It merely confirms, but
does not confer, ownership [Lu v. Manipon,
GR No. 147072, 2002]
E. EFFECT OF NON-REGISTRATION
If a purchaser, mortgagee or grantee should
fail to register his deed the conveyance, in light
of our existing registration laws, shall not be
valid against any person unless registered.
Exceptions:
(1) The grantor,
(2) His heirs and devisees, and
(3) Third persons having actual notice or
knowledge thereof.
It is a settled rule that lands under a Torrens
title cannot be acquired by prescription or
adverse possession. Section 47 of P.D. No.
1529, the Property Registration Decree,
expressly provides that no title to registered
land in derogation of the title of the registered
owner shall be acquired by prescription or
adverse possession. [Dream Village
Neighborhood Association, Inc., represented
by its Incumbent President Greg Seriego v.
Bases Conversion Development Authority, G.R.
No.192896, July 24, 2013.]
DEALINGS IN LAND BEFORE ISSUANCE
OF DECREE:
With the filing of an application for
registration, the land described therein does
not cease to become open to any lawful
transaction. If the transaction takes place
before the issuance of the decree of
registration, Section 22 of PD 1529 provides
that the instrument is to be presented to the
RTC, together with a motion praying that the
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
463
same be considered in relation with the
pending application.
However, if the motion is filed after the
decision of adjudication has become final but
before the issuance of the decree by the
Administrator of Land Registration Authority,
the court shall require the interested party to
pay the fees prescribed as if such instrument
had been presented for registration in the
office of the Register of Deeds. [Pena, p. 72-73]
LACHES, WHEN IT APPLIES.
Laches sets in if it would take 18 years for a
person to file an action to annul the land
registration proceedings, especially so if the
registrant has already subdivided the land and
sold the same to innocent third parties. A
partys long inaction or passivity in asserting
his rights over disputed property precludes him
from recovering the same. [Heirs of Teodoro
dela Cruz vs. CA, 298 SCRA 172; Aurora
Ignacio v. Valeriano Basilio, et al., G.R. No.
122824, Sept. 26, 2001]
II. The Regalian Doctrine
A western legal concept that was first
introduced by the Spaniards into the country
through the laws of the Indies and the Royal
Cedulas. Whereby the Philippines passed to
Spain by virtue of discovery and conquest.
Consequently, all lands became the exclusive
patrimony and dominion of the Spanish Crown.
[Agcaoili]
Sec. 2, Art. XII of the
1987 Constitution
All lands of the public
domain, waters,
minerals, coal,
petroleum, and other
mineral
oils, all forces of
potential energy,
fisheries,
forests or timber,
wildlife, flora and fauna,
and
other natural resources
are owned by the
State. With the
exception of agricultural
lands,
all other natural
resources shall not be
alienated. The
exploration,
development, and

utilization of natural
resources shall be under
the full control and
supervision of the State.
The State may directly
undertake such
activities, or it may
enter into co-production,
joint venture, or
production-sharing
agreements with Filipino
citizens, or
corporations or
associations at least 60
per
centum of whose capital
is owned by such
citizens. Such
agreements may be for
a period
not exceeding twenty-
five years, renewable for
not more than twenty-
five years, and under
such terms and
conditions as may be
provided
by law. In cases of water
rights for irrigation,
water supply, fisheries,
or industrial uses other
than the development of
waterpower,
beneficial use may be
the measure and limit of
the grant.
The State shall protect
the nations marine
wealth in its archipelagic
waters, territorial
sea, and exclusive
economic zone, and
reserve
its use and enjoyment
exclusively to Filipino
citizens.
The Congress may, by
law, allow small-scale
utilization of natural
resources by Filipino
citizens, as well as
cooperative fish farming,
with priority to
subsistence fishermen
and fish
workers in rivers, lakes,
bays, and lagoons.
The President may enter
into agreements with
foreign-owned
corporations involving
either
technical or financial
assistance for large-
scale
exploration,
development, and
utilization of
minerals, petroleum,
and other mineral oils
according to the general
terms and conditions
provided by law, based
on real contributions to
the economic growth
and general welfare of
the country. In such
agreements, the State
shall promote the
development and use of
local scientific and
technical resources.
The President shall
notify the Congress of
every contract entered
into in accordance with
this provision, within
thirty days from its
execution.

The principle of State ownership of lands and

all other natural resources had its roots in the
1935 Constitution, which expressed the
overwhelming sentiment in the Convention in
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
464
favor of the principle of State ownership of
natural resources and the adoption of the
Regalian doctrine as articulated in Sec. 1, Art
XIII.
The 1973 Constitution reiterated the Regalian
Doctrine in Sec. 8, Art. XIV.
The present Constitution provides that, except
for agricultural lands of the public domain
which alone may be alienated, forest or timber,
and mineral lands, as well as all other natural
resources must remain with the State, the
exploration, development, and utilization of
which shall be subject to its full control and
supervision albeit allowing it to enter into coproduction, joint venture, or
productionsharing agreements, or into agreements with
foreign-owned corporations involving technical
or financial assistance for large-scale
exploration, development, and utilization.
[Secs. 2 and 3, Art. XII; La Bugal-Blaan Tribal
Association, Inc. v. Ramos
]
Enshrined in the Constitution [Art 12, Sec 2 &
3
], it states that all lands of public domain
belong to the state, thus private title to land
must be traced to some grant, express or
implied, from the state, i.e. The Spanish Crown
or its successors, the American Colonial
government and thereafter the Philippine
Republic
It does not negate native title to lands held in
private ownership since time immemorial [Cruz
v. Sec. of Environment and Natural Resources
]
It recognized ownership of land by Filipinos
independent of any grant from the Spanish
crown on the basis of possession since time
immemorial [cf: Carino v. Insular Government],
it is presumed to have been held prior the
Spanish conquest and never to have been
public land.
A. EFFECTS
(1) All lands of public domain belong to the
state, and that the State is the source of
any asserted right to ownership in land and
charged with the conservation of such
patrimony [Republic v. IAC, GR No. 71285]
(2) All lands not otherwise appearing to be
clearly within private ownership are
presumed to belong to the State [Dir. Of
Lands v. IAC, 1993, 219 SCRA 339
]
(3) Any applicant for judicial confirmation of
an imperfect title has the burden of
proving, by incontrovertible evidence, that
the (a) land applied for is alienable and
disposable public land; and, (b) the
applicant, by himself or through his
predecessors-in-interest had occupied and
possessed the land, in the concept of
owner, openly, continuously, exclusively,
and adversely since June 12, 1945, or
earlier. [Pelbel Manufacturing Corp. v. CA,
GR No. 141325
]
B. CONCEPT OF NATIVE TITLE, TIME
IMMEMORIAL POSSESSION
A recognized exception to the theory of jura
regalia, the ruling in Carino v. Insular
Government institutionalized the recognition
of the existence of native title to land, or
ownership of land by Filipinos by virtue of
possession under a claim of ownership since
time immemorial and independent of any
grant from the Spanish Crown [Agcaoili]
Lands under native title are not part of public
domain, lands possessed by an occupant and
his predecessors since time immemorial, such
possession would justify the presumption that
the land had never been part of the public
domain or that it had been private property
even before the Spanish conquest [Republic v.
CA, GR No. 130174
]
Certificate of Ancestral Domain Title: A formal
recognition, when solicited by Indigenous
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
465
Cultural Communities/Indigenous People
(ICCs/IPs) concerned, shall be embodied in a
Certificate of Ancestral Domain Title (CADT),
which shall recognize the title of the concerned
ICCs/IPs over the territories identified and
delineated [Sec. 11, IPRA]
Like a Torrens title, a CADT is evidence of
private ownership of land by native title. Native
title, however, is a right of private ownership
particularly granted to ICCs/IPs over their
ancestral lands and domains. The IPRA
categorically declares ancestral lands and
domains held by native title as never to have
been public land. [Cruz v. Sec. of Environment
and Natural Resources, 2000, GR No. 135385
]
III. Citizenship
Requirement
A. INDIVIDUALS
Art. XII, Sec. 3, 1987
Constitution provides, in
part:
Lands of the public
domain are classified
into
agricultural, forest or
timber, mineral lands
and national parks.
Agricultural lands of the
public domain may be
further classified by law
according to the uses to
which they may be
devoted. Alienable lands
of the public domain
shall be limited to
agricultural lands.
Private
corporations or
associations may not
hold such
alienable lands of the
public domain except by
lease, for a period not
exceeding twenty-five
years, renewable for not
more than twenty-five
years, and not to exceed
one thousand
hectares in area.
Citizens of the
Philippines
may lease not more than
five hundred
hectares, or acquire not
more than twelve
hectares thereof, by
purchase, homestead, or
grant.

The Krivenko Doctrine - The capacity to acquire

private land is made dependent upon the
capacity to acquire or hold lands of public
domain. Private land may be transferred or
conveyed only to individuals or entities
qualified to acquire lands of public domain [II
Bernas
]
The 1935 Constitution reserved the right xxx for
Filipino citizens or corporations at least sixty
percent of the capital of which was owned by
Filipinos. Aliens, whether individuals or
corporations, have been disqualified from
acquiring public lands; hence they have also
been disqualified from acquiring private lands.
[Krivenko v. Register of Deeds, GR No. L-630:
Ong Ching Po v CA, GR. No. 113427
]
General Rule: Non-Filipinos cannot acquire or
hold title to private lands of public domain,
except only by way of legal succession [Halili v.
CA, GR No. 113539, Sec 2, 5 Art XII
Constitution]
Exceptions:
(1) Aliens by way of hereditary succession
(2) Natural born citizens who have lost their
citizenship- limited to 5,000 sq. m. for
urban land and 3 hectares for rural land
[RA No. 7042 as amended by RA No. 8179]
(3) Aliens, although disqualified to acquire
lands of public domain, may lease private
land for a reasonable period provided, that
such lease does not amount to a virtual
transfer of ownership. They may also be
given an option to buy property on the
condition that he is granted Philippine
citizenship. [Llantino v. Co liong Chong, GR
No. 29663]
(4) Lands acquired by an American citizen
prior the proclamation of Philippine
Independence on July 4, 1946 but after the
passage of the 1935 Constitution may be
registered, based on the ordinance
appended to the 1935 Constitution [Moss v.
Director of Lands, GR No. L-27170]
(5) Land sold to an alien which is now in the
hands of a naturalized citizen can no
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
466
longer be annulled [De Castro v. Tan, GR
No. L-31956
]. The litigated property is now
in the hands of a naturalized Filipino. It is
no longer owned by a disqualified vendee.
The purpose of the prohibition ceases to be
applicable. [Barsobia v. Cuenco, GR No. L-
33048
]
B. CORPORATIONS
Private corporations may not hold alienable
lands of the public domain except by lease for
a period not exceeding twenty-five years,
renewable for not more than twenty-five years,
and not to exceed one thousand hectares in
area. [1987 Constitution, Art. XII, Sec. 3]
Limitations to Ownership of Land by
Corporations:
(1) For private lands:
(a) At least 60% Filipino [Sec. 7, Art. XII,
1987 Constitution
]
(b) Restricted as to extent reasonably
necessary to enable it to carry out the
purpose for which it was created
(c) If engaged in agriculture, it is restricted
to 1,024 hectares
(2) For patrimonial property of the State [Sec.
3, Art. XII, 1987 Constitution
]
(a) Lease only for a limited period of 25
years; cannot own land of the public
domain
(b) Limited to 1,000 hectares
(c) Applies to both Filipino and Foreign
Corporations
A corporation sole may acquire and register
private agricultural land [RC Apostolic
Administrator of Davao v. LRC GR No. L-8415
]:
A corporation sole, which consists of one
person only, is vested with the right to
purchase and hold real estate and register the
same in trust for the faithful or members of the
religious society or church for which the
corporation was organized
IV. Original Registration
Original Registration - This is a proceeding
brought before the land registration court to
determine title or ownership of land on the
basis of an application for registration or
answer by a claimant in a cadastral
registration.
A decree of registration merely confirms, but
does not confer ownership. [City Mayor of
Paraaque City v. Ebio] Registration does not
vest title or give title to the land, but merely
confirms and thereafter protects the title
already possessed by the owner, making it
imprescriptible by occupation of third parties.
The registration does not give the owner any
better title than he has. He does not obtain
title by virtue of the certificate. He secures his
certificate by virtue of the fact that he has a fee
simple title. [Legarda v. Saleeby]
Distinguished from subsequent
(1) Original Registration When right of
ownership or title to land is for the first
time made of public record
(2) Subsequent Registration Any transaction
affecting such originally registered land, if
in order, may be registered in the Office of
the Register of Deeds concerned
A. KINDS OF ORIGINAL
REGISTRATION:
(1) Voluntary by filing with the proper court
under:
(a) PD 1529, Property Registration Decree
(b) CA 141, Public Land Act
(c) RA 8371, IPRA
(2) Involuntary as in Cadastral Proceedings
(1) This is compulsory registration
initiated by the government to
adjudicate ownership of the land
(2) Involuntary on the part of the claimant
but they are compelled to substantiate
their claim or interest
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
467
B. WHO MAY APPLY:
(1) Under Sec. 14, PD 1529
(a) Those who by themselves or through
their predecessors-in-interest, have
been in open, continuous, exclusive
and notorious possession and
occupation of alienable and disposable
lands of the public domain under a
bona fide claim of ownership since
June 12, 1945, or earlier.
(b) Those who have acquired ownership of
private lands by prescription under the
provisions of existing laws.
(c) Those who have acquired ownership of
private lands or abandoned river beds
by right or accession or accretion under
the existing laws.
(d) Those who have acquired ownership of
land in any other manner provided for
by law.
(i) If land is owned in common, ALL
co-owners shall file the application
jointly
(ii) If land has been sold under pacto
de retro, the vendor a retro may file
an application for the original
registration of the land, provided,
however that should the period for
redemption expire during the
pendency of the registration
proceedings and ownership to the
property consolidated in the
vendee a retro, the latter shall be
substituted for the applicant and
may continue the proceedings.
(iii) A trustee on behalf of his principal
may apply for original registration
of any land held in trust by him,
unless prohibited by the
instrument creating the trust.
(2) Under Sec. 12, CA 141; Any person who:
(a) Is a citizen of the Philippines over the
age of 18, or the head of a family
(b) Does not own more than 24 hectares of
land in the Philippines, or has not had
the benefit of any gratuitous allotment
of more than 24 hectares of land since
the occupation of the Philippines by
the United States
(c) NOTE: they may enter a homestead of
not exceeding 24 hectares of
agricultural land of the public domain
(3) Under RA 8371
(a) Sec. 11 Formal recognition of
ancestral domains by virtue of Native
Title may be solicited by ICCs/IPs
concerned
(b) Sec. 12 Option to secure certificate of
title under CA 141 or Land Registration
Act 496
(i) Individual members of cultural
communities with respect to
individually-owned ancestral lands
who, by themselves or through
their predecessors-in -interest,
have been in continuous
possession and occupation of the
same in the concept of owner since
time immemorial or for a period of
not less than thirty (30) years
immediately preceding the
approval of this Act and
uncontested by the members of the
same ICCs/IPs shall have the
option to secure title to their
ancestral lands
(ii) Option granted shall be exercised
within 20 years from the approval
of RA 8371
Where to File: The court that should take
cognizance of a registration case is that which
has territorial jurisdiction over the property.
General Rule: RTC of the province, city, or
municipality where the property is situated
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
468
The RTC shall have exclusive jurisdiction over
all applications original for registration of title,
with power to hear and determine all questions
arising upon such applications or petition.
[Sec. 2, par. 2, P.D. No. 1529]
Exception: Delegated jurisdiction to the MTC,
MeTC, and MCTC by the Supreme Court in
cadastral and land registration cases IF:
(1) There is no controversy over the land, OR
(2) Its value is less than P100,000 [Sec. 34, BP
129
]
C. PROCEDURE IN ORDINARY LAND
REGISTRATION
STEP 1: Survey of the land by the Bureau of
Lands or a duly registered private surveyor
Note: No plan of such survey, whether it be
original or subdivision, may be admitted in
land registration proceedings until approved
by the Director of lands [Sec. 1858,
Administrative Code
]
STEP 2: Filing of application for registration by
the applicant;
(a) Form of the application
(1) In writing
(2) Signed by the applicant/s or person
duly authorized in his behalf
(3) Sworn before any officer authorized to
administer oath for the province or city
where the application was actually
signed
(4) Application is presented in duplicate
(b) Contents of the application:
(1) A description of the land
(2) The citizenship and civil status of the
applicant, whether single or married,
and, if married, the name of the wife or
husband, and, if the marriage has been
legally dissolved, when and how the
marriage relation terminated. It shall
also state
(3) The full names and addresses of all
occupants of the land and those of the
adjoining owners, if known, and, if not
known, it shall state the extent of the
search to find them.
(4) Whether the property is conjugal,
paraphernal or exclusively owned by
the applicant.
(c) Documents to accompany the application
[from Regulations in Ordinary Land
Registration Cases]
(1) Tracing-cloth plan duly approved by
the Director of Lands, together with
two blueprint or photographic copies
thereof;
(2) Three copies of the corresponding
technical descriptions;
(3) Three copies of the surveyors
certificate;
(4) All original muniments of title in the
possession of the applicant which
prove his rights, to the title he prays for
or to the land he claims; and
(5) Certificate in quadruplicate of the city
or provincial treasurer of the assessed
value of the land, at its last assessment
for taxation, or, in the absence thereof,
that of the next preceding year.
However, in case the land has not been
assessed, the application may be
accompanied with an affidavit in
quadruplicate of the fair market value
of the land, signed by three
disinterested persons.
(d) Amendments to the Application
(1) Sec. 19, PD 1529 permits the applicants
to amend the application at any stage
of the proceedings upon such just and
reasonable terms as the court may
order;
(2) However, Sec. 23, PD 1529 mandates
that there is a need to comply with the
required publication and notice as in
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
469
an original application if the
amendment is substantial as in:
(i) A change in the boundaries
(ii) An increase in the area of the land
applied for; or
(iii) The inclusion of an additional land
(e) Special Cases:
(1) If the land bounded by a road, the
applicant must state in his application
if he claims any portion of the land
within the limits of the road, or if he
likes to have the boundaries
determined. [Sec. 20, PD 1529]
(2) If the applicant is a non-resident, he
shall appoint an agent or
representative who is a Philippine
resident. [Sec. 16, PD 1529]
(3) Intestate Estate of Don Mariano San
Pedro v. CA (1996): A person claiming
ownership of real property must clearly
identify the land claimed by him.
(4) In re: Application for Land Registration
v. Republic (2008): An applicant in a
land registration case must prove the
facts and circumstances evidencing the
alleged ownership of the land applied
for. General statements which are
mere conclusions of law and not
factual proof of possession are
unavailing. The deeds in its favor only
proved possession of its predecessorsin-interest as early as 1948. (The law
now stands that a mere showing of
possession for 30 years is not
sufficient. OCEN possession must be
shown to have stated on June 12, 1945
or earlier.)
STEP 3: Setting of the date for the initial
hearing of the application by the Court;
(a) The court shall issue an order setting the
date and hour of the initial hearing within
5 days from filing of the application
(b) The initial hearing shall be 45 90 days
from the date of the order [Sec. 23, PD
1529
]
STEP 4: Transmittal to the LRA
The application and the date of initial hearing
together with all the documents or other
evidences attached thereto are transmitted by
the Clerk of Court to the Land Registration
Authority (LRA)
STEP 5: Publication of a notice of the filing of
the application and date and place of hearing
(a) Publication shall be sufficient to confer
jurisdiction upon the court. [Sec. 23, PD
1529
]
(b) Form and contents of the notice:
(1) Addressed to all persons appearing to
have an interest in the land involved
(2) Requires all persons concerned to
appear in court on the date and time
indicated to show cause why the
application for registration should not
be granted
(c) The public shall be given notice of the
initial hearing of the application by
publication
(1) The Commissioner of Land
Registration (CLR) shall cause it to be
published once in the Official gazette
AND once in a newspaper of general
circulation
(2) This is sufficient to confer jurisdiction
to the court
(d) It is not necessary to give personal notice
to the owners or claimants of the land
sought to be registered to vest the court
with authority over the res. Land
registration proceedings are actions in
rem. [Dir. Of Lands v. CA, 276 SCRA 276]
(e) Once the registration court had acquired
jurisdiction over a certain parcel, or
parcels, of land in the registration
proceedings in virtue of the publication of
the application, that jurisdiction attaches
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
470
to the land or lands mentioned and
described in the application. If it is later
shown that the decree of registration had
included land or lands not included in the
original application as published, then the
registration proceedings and the decree of
registration must be declared null and void
insofar but only insofar as the land not
included in the publication is concerned.
[Benin v. Tuason, 57 SCRA 531]
STEP 6: Service of notice upon contiguous
owners, occupants and those known to have
interest in the property by the Sheriff;
(a) Mailing:
(1) Within 7 days from publication, the
CLR shall mail a copy of the notice
(2) Copies of the notice shall be mailed to:
(i) Every person named in the notice
whose address is known.
(ii) the Secretary of Public Highways,
to the Provincial Governor, and to
the Mayor of the municipality or
city, in which the land lies, if the
applicant requests to have the line
of a public way or road determined
(iii) Secretary of Agrarian Reform, the
Solicitor General, the Director of
Lands, the Director of Mines
and/or the Director of Fisheries
and Aquatic Resources, (as
appropriate) if the land borders on
a river, navigable stream or shore,
or on an arm of the sea where a
river or harbor line has been
established, or on a lake, or if it
otherwise appears from the
application or the proceedings that
a tenant-farmer or the national
government may have a claim
adverse to that of the applicant
(b) Posting:
(1) CLR shall cause the sheriff or his
deputy to post the notice at least 14
days before the hearing:
(2) In a conspicuous place on each parcel
of land included in the application and
in a conspicuous place on the bulletin
board of the municipal building of the
municipality or city in which the land or
portion thereof is situated.
(3) The court may also cause notice to be
served to such other persons and in
such manner as it may deem proper.
(c) Notice of application and initial hearing by
publication is sufficient and the mere fact
that a person purporting to have a
legitimate claim in the property did not
receive personal notice is not a sufficient
ground to invalidate the proceedings
although he may ask for the review of the
judgment or the reopening of the decree of
registration, if he was made the victim of
actual fraud. [Republic v. Abadilla, CA;
G.R. No. 6902-R, Oct. 6, 1951
]
STEP 7: Filing of answer or opposition to the
application by any person whether named in
the notice or not;
(a) Who may file? Any person claiming an
interest, whether named in the notice or
not
(b) When to file? On or before the date of
initial hearing, or within such further time
as may be allowed by the court.
(c) What shall it contain? It shall state all the
objections and the interest claimed by the
party the remedy desired.
(d) How shall it be made? It shall be signed
and sworn to by him or by some other duly
authorized person. Sec. 25, PD 1529
provides for the requisites of an opposition:
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
471
(1) It shall set forth all the objections to
the application and
(2) It shall state the interest claimed by
the party filing the same
(e) Effect of Failure to Answer:
(1) If no one appears/files an answer,
upon motion, the court shall order a
default to be recorded.
(2) By the description in the notice "To all
Whom It May Concern", all the world
are made parties defendant and shall
be concluded by the default order.
(3) Where an appearance has been
entered and an answer filed, a default
order shall be entered against persons
who did not appear and answer.
(4) Absence of opposition does not justify
outright registration. [Director of Lands
vs. Agustin, 1921]
(f) Effects of Default:
(1) With respect to the Applicant he has
the right to present or adduce evidence
ex parte
(2) With respect to those covered by the
default order they have no legal
standing in court; therefore, they are
no longer allowed to participate and
no opportunity to present evidence
(g) For relief from an order of default, see Sec.
3, Rule 18, Rules of Court
STEP 8: Hearing of the case by the court
(a) Applicable procedural law:
(1) Reception of evidence is governed by
PD 1529
(2) Rules of Court shall, insofar as not
inconsistent with the provisions of the
Decree, be applicable to land
registration and cadastral cases by
analogy or in a suppletory character
and whenever practicable and
convenient [Sec. 34, PD 1529]
(b) Sec. 27, PD 1529: Court may either:
(1) Hear the parties and their evidence, or
(2) Refer the case or any part thereof to a
referee
(a) Referee shall hear the parties,
receive their evidence, and submit
his report thereon to the Court
within 15 days after termination of
such hearing
(b) Hearing before a referee may be
held at any convenient place within
the province or city as may be fixed
by him and after reasonable notice
thereof shall have been served to
the parties concerned
(c) Upon receipt of the report the
Court may:
(i) Adopt the same
(ii) Set aside the report
(iii) Modify the report
(iv) Refer back or recommit the
case to the referee for
presentation of evidence
STEP 9: Promulgation of judgment by the
Court;
(a) This is the adjudication, determination,
and resolution of the issue of ownership
(b) Forms of Judgment:
(1) Dismissal of the application with
prejudice or without prejudice
(2) Partial Judgment in a case where
only a portion of the land subject of
registration is contested, the court may
render partial judgment provided that
a subdivision plan showing the
contested and uncontested portions
approved by the Director of Land is
previously submitted to said court.
[Sec. 28, PD 1529]
(3) Judgment Confirming Title - Judgment
may be rendered confirming the title of
the applicant, or the oppositor as the
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
472
case may be, to the land or portions
thereof upon finding that the party
concerned has sufficient title proper for
registration. [Sec. 29, PD 1529]
(c) Finality of Judgment - Sec. 30, par. 1, PD
1529 provides that the judgment becomes
final upon the expiration of 30 days
counted from receipt of notice of
judgment.
Note: This has been MODIFIED to the lapse
of 15 days counted from receipt of notice of
judgment as per Sec. 39, BP 129
STEP 10: Issuance of the decree
(a) If the court finds after hearing that the
applicant or adverse claimant has title as
stated in his application or adverse claim
and proper for registration, a decree of
confirmation and registration shall be
entered
(b) The Court declares the decision final and
instructs the LRA to issue a decree of
confirmation and registration within 15
days from entry of judgment
Note: it is not the court that issues the
decree, but the LRA
(c) One year after issuance of the decree, it
becomes incontrovertible and
amendments of the same will not be
allowed except in cases of clerical errors
(1) Court retains jurisdiction over the case
until after the expiration of 1 year from
the issuance of the decree of
registration. [Gomez v. CA, 1988]
(2) Note: While a decision in land
registration proceeding becomes final
after the expiration of thirty days from
the date of service of its notice, the
decree of registration does not become
final until after the lapse of one year
from the date of its issuance and entry.
STEP 11: Entry of the decree of registration
(a) Decree is entered in the LRA
(b) Every decree of registration shall:
(1) Bear the day of the year, hour, and
minute of its entry,
(2) Be signed by the Administrator of the
Land Registration Authority in his ex
officio capacity as Clerk of Court in
land registration matters
(3) State whether the owner is:
(i) Married or unmarried, and if
married, the name of the husband
or wife, provided that if the land
adjudicated is conjugal property, it
shall be issued in the names of
both spouses.
(ii) If the owner is under disability, it
shall state the nature of the
disability,
(iii) If the owner is a minor, his age
(4) Contain a description of the land as
finally determined by the court,
(5) Set forth the estate of the owner, and
also, in such manner as to show their
relative priority, all particular estates,
mortgages, easements, liens,
attachments and other encumbrances,
including rights of tenant-farmer, if
any, to which the land or owners
estate is subject,
(6) Contain any other matter properly to
be determined
STEP 12: Sending of copy of the decree of
registration to the corresponding Register of
Deeds (Registrar of Land Titles and Deeds)
STEP 13: Transcription of the decree of
registration
(a) It is transcribed in the registration book of
the Registrar of Land Titles and Deeds
(b) Registrar issues owners duplicate OCT of
the applicant by the Registrar of Land
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
473
Titles and Deeds, upon payment of the
prescribed fees.
D. EVIDENCE NECESSARY
Proofs necessary in land registration
(1) Proofs that land has been declassified
from the forest zone, is alienable or
disposable, and is registrable (e.g.
Presidential proclamation, legislative acts)
(2) Identity of the land (e.g. survey plan)
(3) Possession and occupation of the land for
the length of time and in the manner
required by law [Sec. 4, PD 1073 amending
Sec. 48(b) and (c) of Public Land Act]
(4) If he claims private ownership not because
of his possession, he must prove the basis
of such claim by submitting muniments of
title.
Proving Private Ownership:
(1) Spanish titles are inadmissible and
ineffective proof of ownership in land
registration proceedings filed AFTER Aug.
16, 1976 [PD 892 as discussed in Santiago
v. SBMA, GR No. 156888, 2006
]
(2) Tax declaration and receipts are not
conclusive but have strong probative value
when accompanied by proof of actual
possession. [Municipality of Santiago vs.
CA, 1983]
(3) Other proofs such as testimonial evidence
E. REMEDIES:
An aggrieved party in a registration proceeding
may avail himself of the following remedies:
(1) Motion for New Trial [see Rule 37, ROC]
(2) Appeal
(3) Relief from Judgment [see Rule 38, ROC]
(4) Annulment of Judgment [see Rule 47,
ROC
]
(5) Reconveyance
(6) Recovery of Damages
(7) Reversion
(8) Review of Decree of Registration
Appeal Sec. 30, PD 1529 as amended by BP
129 provides that an appeal may be taken from
the judgment of the court as in ordinary civil
cases.
Period in Sec. 30, PD 1529 has been
modified to 15 days as per Sec. 39, BP 129
Unlike ordinary civil actions, the adjudication
of land in a cadastral or land registration
proceeding does not become final in the sense
of incontrovertibility until after the expiration
of one (1) year after the entry of the final decree
of registration. As long as a final decree has
not been entered by the LRA and the period of
1 year has not elapsed from date of such
decree, the title is not finally adjudicated and
the decision in the registration proceeding
continues to be under the control and sound
discretion of the court rendering it. [Gomez v.
CA, 168 SCRA 503, 1988
]
Action for Reconveyance:
(a) When to file:
(1) Before issuance of decree, or
within/after 1 year from entry
(2) If based on implied trust, 10 years;
(3) If based on expressed trust and void
contract, imprescriptible
(4) If based on fraud, 4 years from the
discovery
(b) Not available if the property has already
been transferred to an innocent purchaser
for value.
(c) It does not reopen proceedings but a mere
transfer of the land from registered owner
to the rightful owner [Esconde v.
Barlongay, 1987
]
Action for Damages - It can be availed of when
reconveyance is no longer possible as when the
land has been transferred to an innocent
purchaser for value [Ching v. CA, 1990]
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
474
Reversion - Instituted by the government, thru
Solicitor General in all cases where lands of
public domain are held in violation of the
Constitution or were fraudulently conveyed.
Indefeasibility of title, prescription, laches, and
estoppel do not bar reversion suits.
Petition to Reopen or Review Decree of
Registration Sec. 32, PD 1529
(a) To whom available: Only to an aggrieved
party who has been deprived of land or any
estate or interest therein by decree of
registration
(b) When to file: Within 1 year from entry of
decree of registration
(1) Upon expiration of the 1 year period,
every decree becomes incontrovertible
(2) The Court held that the petition may be
filed at any time after rendition of the
courts decision (no need to wait for
actual entry in the LRA) and before
expiration of one year from entry of the
final decree of registration. [Rivera v.
Moran, 48 Phil. 836; Director of Lands
v. Aba, et al., 68 Phil. 85.
]
(c) Sole and ONLY Ground: Actual Fraud
(1) Actual fraud proceeds from an
intentional deception practiced by
means of misrepresentation or
concealment of material fact
(2) The fraud must consist in an
intentional omission of fact required by
law to be stated in the application or a
wilful statement of a claim against the
truth
(d) Requisites for Petition to Reopen or Review
(1) That the plaintiff is the owner of the
land ordered registered in the name of
the defendant, or that the plaintiffs
lien or interest in said property does
not appear in the decree or title issued
in the defendants name;
(2) That the registration was procured
through actual fraud, or that the
omission of the lien or interest was
fraudulent;
(3) That the property has not been
transferred to an innocent purchaser
for value; and
(4) That the action is fi led within one year
from the issuance and entry of the
decree of registration. [Cruz v. Navarro,
GR No. L-27644, 1973
]
F. PETITIONS AND MOTIONS AFTER
ORIGINAL REGISTRATION
(a) Lost Duplicate Certificate
(1) Person in interest must file a sworn
statement that the certificate is lost
before the Register of Deeds
(2) A petition will then be filed for the
issuance of new title
(3) Court will order issuance of new title
after due notice and hearing, with
memorandum that it is issued in place
of a lost certificate
(b) Petition seeking surrender of duplicate title
(1) In voluntary and involuntary
conveyances; when the duplicate
cannot be produced, the party must
petition the court to compel surrender
of duplicate certificate of title to
Register of Deeds
(2) After hearing, court may order
issuance of a new certificate and annul
the old certificate
(c) Amendment and alteration of certificate of
title
(1) A certificate of title cannot be altered
or amended except in a direct
proceeding in court which is summary
in nature
(2) Grounds:
(i) New interest that does not appear
on the instrument have been
created
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
475
(ii) Interest have been terminated or
ceased
(iii) Omission or error was made in
entering certificate
(iv) Name of person on certificate has
been changed
(v) Registered owner has married
(vi) Marriage has terminated
(vii) Corporation has dissolved and has
not conveyed the property within
3 years after its dissolution
(viii) Allowable corrections as long as
the rights or interest of persons
are not impaired
(d) Reconstitution of Certificate of title
(1) The restoration of the instrument
which is supposed to have been lost or
destroyed in its original form and
condition, under the custody of the
Register of Deeds
(2) To have the same reproduced after
proper proceedings in the same form
they were when the loss or destruction
occurred [Heirs of Pedro Pinote v.
Dulay, 1990]
(3) Kinds:
(i) Judicial
(1) A petition is filed before the
RTC
(2) Petition is published in the
Official Gazette for 2
consecutive issues and posted
on main entrance of
municipality for at least 30
days before hearing
(3) Hearing is then conducted
(4) Court may then order
reconstitution if meritorious
(ii) Administrative, which may be
availed only in case of:
(1) Substantial loss or destruction
of original land titles due to
fire, flood, or other force
majeure as determined by the
LRA
(2) Number of certificates of title
lost or damaged should be at
least 10% of the total number
in possession of the Register of
Deeds
(3) In no case shall the number of
certificates of title lost or
damaged be less than 500;
AND
(4) Petitioner must have the
duplicate copy of the certificate
of title [RA 6732]
V. Judicial Confirmation
Of Imperfect Or
Incomplete Titles
Applicable law: CA 141, as amended
No title or right to, or equity in, any lands of the
public domain may be acquired by prescription
or by adverse possession or occupancy except
as expressly provided by law. [CA 141, Sec 57]
The Public Land Act recognizes the concept of
ownership under the civil law. This ownership
is based on adverse possession and the right of
acquisition is governed by the Chapter on
judicial confirmation of imperfect or
incomplete titles.
When applicable: This applies only to alienable
and disposable agricultural lands of the public
domain. Under Sec. 6 of CA 141, the
classification of public lands into alienable and
disposable forest lands, or mineral lands is the
prerogative of the Executive Department.
The rule on confirmation of imperfect title does
not apply unless and until the land classified
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
476
as, say, forest land, is released in an official
proclamation to that effect so that if may form
part of the disposable agricultural lands of the
public domain. [Bracewell vs. CA, 2000]
The law, as presently phrased, requires that
possession of lands of the public domain must
be from June 12, 1945 or earlier, for the same
to be acquired through judicial confirmation of
imperfect title [Republic v. Doldol, 1998]
Who may apply:
(a) Individuals:
(1) Filipino citizens who by themselves or
through their predecessors-in-interest
have been in open, continuous,
exclusive, and notorious possession
and occupation of alienable and
disposable lands of public domain
under a bona fide claim of acquisition
since June 12, 1945 or prior thereto
since time immemorial [Sec. 48, CA
141, as amended by Sec. 4, PD 1073]
(2) Filipino citizens who by themselves or
their predecessors-in-interest have
been, prior to effectivity of PD 1073 on
Jan. 25, 1977, in open, continuous,
exclusive, and notorious possession
and occupation of agricultural lands of
the public domain, under a bona fide
claim of acquisition of ownership for at
least 30 years, or at least since Jan. 24,
1947 [RA 1942]
(3) Natural born citizens of the Philippines
who have lost their citizenship and who
has legal capacity to enter into a
contract under Philippine laws may be
a transferee of private land up to a
maximum area of 5,000sqm, in case of
urban land, or 3 hectares in case of
rural land to be used by him for
business or other purposes [Sec. 5, RA
8179
]
(4) Natural-born citizens of the
Philippines, who have lost their
Philippine citizenship, who have
acquired disposable and alienable
lands of the public domain from
Filipino citizens who had possessed the
same in the same manner and for the
length of time indicated in numbers (1)
and (2) above.
(b) Corporations
(1) Private domestic corporations or
associations which had acquired lands
from Filipino citizens who had
possessed the same in the manner and
for the length of time indicated in
numbers (1) and (2) above.
Notwithstanding the prohibition in the
1973 and 1987 Constitutions against
private corporations holding lands of
the public domain except by lease not
exceeding 1000 hectares, still a private
corporation may institute confirmation
proceedings under Sec. 48, (b) of the
Public Land Act if, at the time of
institution of the registration
proceedings, the land was already
private land. On the other hand, if the
land was still part of the public
domain, then a private corporation
cannot institute such proceedings. [Dir.
Of Lands v. IAC and ACME, 146 SCRA
509, 1986
]
A. FILING OF THE APPLICATION:
Period of Filing is EXTENDED: RA No. 9176
extended the period to file an application for
judicial confirmation of imperfect or
incomplete title to December 31, 2020. Prior to
RA 9176 the deadline for filing was on Dec. 31,
1987.
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
477
Scope of the Application: RA 9176 also limited
the area subject of the application to 12
hectares. Prior to RA 9176, the maximum area
applied for was 144 hectares.
Applicant must Prove:
(1) The land is alienable and disposable land
of public domain; and
(2) They have been in open, continuous,
exclusive, and notorious possession and
occupation of the land for the length of
time and in the manner and concept
provided by law [Dir. Of Lands v. Buyco,
1992
]
B. PROCEDURE IN JUDICIAL
CONFIRMATION:
Sec. 48, par.1, of CA 141 as amended provides,
The following-described citizens of the
Philippines, occupying lands of the public
domain or claiming to own any such lands or
an interest therein, but whose titles have not
been perfected or completed, may apply to the
Court of First Instance of the province where
the land is located for confirmation of their
claims and the issuance of a certificate of title
therefor under the Land Registration Act
Hence, the procedure in original registration
discussed in the previous section is also
followed in judicial confirmation of imperfect
or incomplete title.
C. EVIDENCE NECESSARY TO
SUBSTANTIATE APPLICATION:
The applicant must prove:
(1) That the land applied for has been
declassified and is a public agricultural
land, is alienable and disposable, or
otherwise capable of registration.
Specifically, the following may be
presented:
(a) Presidential proclamation
(b) Executive Order
(c) Administrative Order issued by the
DENR Secretary
(d) Bureau of Forest Development Land
Classification Map
(e) Certification by the Director of Forestry
(f) Investigation reports of Bureau of
Lands Investigator
(g) Legislative act or statute
(2) The identity of the land; the following may
be submitted:
(a) Survey plan
(b) Tracing cloth plan and blue print
copies of plan
(c) Technical description of the land
(d) Tax declarations
(e) Boundaries and area
(3) Possession and occupation of the land for
the length of time and in the manner
required by law
VI. Cadastral
Registration
Nature: It is a proceeding in rem, initiated by
the filing of a petition for registration by the
government, not by the persons claiming
ownership of the land subject thereof, and the
latter are, on the pain of losing their claim
thereto, in effect compelled to go to court to
make known their claim or interest therein,
and to substantiate such claim or interest.
Unlike other kinds of registration, this is
compulsory as it is initiated by the government.
The government does not seek the registration
of land in its name. The objective of the
proceeding is the adjudication of title to the
lands or lots involved in said proceeding.
A. DISTINGUISHED FROM ORDINARY
REGISTRATION
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
478
Voluntary Compulsory
Applicant is a person
Applicant is the
claiming title to the
Director of Lands
land
Usually involves
land; it may also
refer to public
agricultural lands if
the object of the
All classes of land are
action is judicial
covered
confirmation of
imperfect or
incomplete title (in
which case CA 141
applies)
Applicant comes to
Government asks the
court to confirm his
court to settle and
title and seek
adjudicate the title of
registration of the
the land
land in his name
In cadastral
If the applicant fails
registration, if the
to prove his title,
applicant cannot
application may be
prove that he is
dismissed without
entitled to the land,
prejudice
the land becomes
Res judicata DOES
public land.
NOT apply
There IS res judicata.

Procedure in Cadastral Registration: Sec. 35

and 36, PD 1529
STEP 1: Determination of the President that
public interest requires title to unregistered
lands be settled and adjudicated
President then orders the Director of Lands
to conduct cadastral survey
STEP 2: Director of lands shall make a
cadastral survey
STEP 3: Director of Lands gives notice to
interested persons
Contents of the Notice:
(a) Day on which the survey will begin
(b) Full and accurate description of the lands
to be surveyed
STEP 4: Publication of notice
(a) Published once in the Official Gazette
(b) A copy of the notice in English or the
national language shall be posted in a
conspicuous place on the bulletin board of
the municipal building of the municipality
in which the lands or any portion thereof is
situated
STEP 5: A copy of the notice shall also be sent
to:
(a) Mayor of the municipality
(b) Barangay captain
(c) Sangguniang Panlalawigan and
Sangguniang Bayan concerned
STEP 6: Geodetic engineers or other Bureau of
Land employees in charge of the survey shall
give notice reasonably in advance of the date
of the survey
They shall also mark the boundaries of the
lands with monuments
STEP 7: Interested persons should
communicate with the geodetic engineer if he
requests for any information about the land
STEP 8: Actual survey and plotting of the land
STEP 9: Director of Lands represented by
Solicitor General shall institute original
registration proceedings
(a) Petition is filed in the appropriate RTC
where the land is situated
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
479
(b) Contents of the Petition:
(1) That public interest requires that the
title to such lands be settled and
adjudicated and praying that such
titles be so settled and adjudicated
(2) Description of the lands
(3) Accompanied by a plan thereof
(4) Such other data as may serve to
furnish full notice to the occupants of
the lands and to all persons who may
claim any right or interest therein
STEP 10: Publication, mailing posting
STEP 11: Hearing
Jurisdiction of the Cadastral Court:
(1) Adjudicate title to any claimant thereto
(2) Declare land as a public land
(3) Order correction of technical description
(4) Order the issuance of new title in place of
the title issued under voluntary registration
proceedings
(5) Determine the priority of overlapping title
(6) Order the partition of the property
STEP 12: Decision
STEP 13: Issuance of the decree and certificate
of title
Note: Reopening of cadastral cases no longer
allowed
RA 931, effective June 20, 1953 for five (5)
years, authorizing the reopening of cadastral
cases under certain conditions and which had
been extended until Dec. 31, 1968, is no longer
in force.
Courts are thus without jurisdiction or authority
to reopen a cadastral proceeding since Dec. 31,
1968. [Aquino, p. 107, citing Republic v.
Estenzo, 158 SCRA 282, 1988
]
VII. Subsequent
Registration
Subsequent registration - a proceeding where
incidental matters AFTER original registration
may be brought before the land registration
court by way of motion or petition filed by the
registered owner or a party n interest
A. NECESSITY AND EFFECTS OF
REGISTRATION
[Sec. 51 and 52, PD 1529]
The deed, mortgage, lease, or other voluntary
instrument, except a will shall ONLY operate
as:
(1) A contract between the parties and
(2) Evidence of authority to the Register of
Deeds to make registration.
The act of registration shall be the operative
act to convey or affect the land insofar as third
persons are concerned.
Also, by registration, it creates constructive
notice to the world.
General Rule: A forged deed is an absolute
nullity and conveys no title.
Exception: If there is good faith, a TCT has
already been issued to the purchaser, the latter
being an innocent purchaser for value
according to Sec. 39, PD 1529, then the title is
good.
General Rule: A person dealing with registered
property need not go beyond, but only has to
rely on, the title. [Campillo v. PNB, 1969]
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
480
He is charged with notice only of such burdens
and claims which are annotated on the title,
for registration is the operative act that binds
the property.
Exception: When should a purchaser
investigate?
(1) Banks are required to exercise more care
and prudence in dealing with registered
lands for their business is one affected with
public interest. The general rule does not
apply.
(2) When party concerned has actual
knowledge of facts and circumstances that
would impel a reasonably cautious man to
make inquiry. [Leung Yee v. Strong
Machinery, 1918]
(3) When purchaser is in bad faith; e.g. he had
full knowledge of a previous sale. [Jamoc v.
CA, 1991
]
(4) When a person buys land from one whose
rights over the land is evidenced only by a
deed of sale and an annotation in the
certificate of title but no TCT. [Quiniano v.
CA, 1971
]
B. TWO TYPES OF DEALINGS
(1) Voluntary Dealings these are deeds,
instruments, documents which are the
results of free and voluntary acts of parties
thereto.
(2) Involuntary Dealings these refer to writ,
order, or process issued by the court of
record affecting registered land, also other
instruments which are not willful acts of
the registered owner, executed without his
knowledge or consent.
Presentation of the
owners duplicate
Entry in the day book is
certificate of title is
sufficient notice to all
required to notify;
persons
mere entry
insufficient
An innocent
purchaser for value
of registered land
becomes the
registered owner
the moment he
presents and files a Lenin v. Bass, (1952):
duly notarized and Entry thereof in the day
valid deed of sale book of the ROD is
and the same is sufficient notice to all
entered in the day persons even if the
book and at the owners duplicate
same time he certificate of title is not
surrenders or presented to the ROD.
presents the
owners duplicate
certificate of title
covering the land
sold and pays the
registration fees.
Villasor v. Camon,
(1951): It is
necessary to Dir. Of Lands v. Reyes,
register the deed or (1976): Entry in the day
instrument in the book is sufficient notice
entry book and a to all persons of an
memorandum adverse claim without
thereof shall also be the same being
made in the annotated at the back
owners duplicate of the certificate of title
certificate and its
original

UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW

481
Spouses Labayen v. AFP Mutual Benefit
Leonardo Serafica, Association v.
(2008): At the time Santiago,
of the filing of the (2008): Entry of the
petition for attachment in the books
cancellation of is sufficient notice to all
encumbrance, the persons. Hence, the
lease contract fact that the deed of
already lost its sale was already
efficacy. Thus, there annotated is of no
is no basis to save moment with regard to
its annotation on third persons. The
defendants title. preference created by
The fact that the
cancellation of the
the levy on attachment
lease contract was
is not diminished by the
forged is of no
subsequent registration
moment, for there
of the deed of sale.
was no violation of a
right.

C. VOLUNTARY DEALINGS
Registration of Voluntary Instruments in General
Process of Registration [Sec. 55, PD 1529]
(1) The deed or other voluntary instrument must
contain:
(a) The following details of the grantee or
other person acquiring or claiming interest:
(1) Full name
(2) Nationality
(3) Residence
(4) Postal address
(5) Civil status (if married, include name in
full of spouse)
(b) If grantee is a corporation:
It must contain a recital showing that such
corporation or association is legally
qualified to acquire private lands
(2) File instrument creating or transferring interest
and certificate of title with Register of Deeds
together with:
(a) Owners duplicate - the issuance of a new
transfer certificate without presentation of
an owners duplicate is unwarranted and
confers no right on the purchaser [PNB v.
Fernandez, 1935]
(b) Payment of fees & documentary stamp tax
(c) Evidence of full payment of real estate tax
(d) Document of transfer 1 copy additional
for city/provincial assessor
(3) Payment of fees and DST
(a) After payment of entry fee the Register of
Deeds shall enter the instruments in a
primary entry book [Sec. 56, PD 1529]
(b) The national, provincial and city
governments are exempted from payment
of entry fees
(c) RA 456 prohibits registration of
documents affecting real property which is
delinquent in the payment of real estate
taxes. Further, if evidence of such payment
is not presented with 15 days from the date
of entry of said document in the primary
entry book of the register of deeds the
entry shall be deemed cancelled.
(4) Entry of the Instrument in the Primary Entry
Book:
Instruments are regarded as registered from
the time the Register of Deeds enters them in
the book
(5) TCT shall then be issued
Registration of Dealings Less than Ownership [Sec.
54, PD 1529
]
If an instrument does not divest ownership or title
from owner or from transferee of the registered
owners, then NO NEW CERTIFICATE shall be
entered or issued.
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
482
Process of Registration for Dealings less than
Ownership
(1) Filing of the instrument with the Register of
Deeds
(2) A brief memorandum thereof is made:
(a) On the certificate of title by the Register of
Deeds and signed by him, and
(b) On the owners duplicate
Cancellation or extinguishment of such interests
shall be registered in the same manner.
Registration of Deeds of Sale and Transfers
(a) If ENTIRE property is the subject [Sec. 57,
PD 1529
]
(1) Owner executes and registers the deed
which must be sufficient in form.
(2) A new certificate of title is issued and
Register of Deeds prepares and
delivers to grantee his owner's
duplicate certificate
(3) Register of Deeds notes upon the OCT
and the duplicate certificate
the date of transfer, the volume and
page of the registration book where
the new certificate is registered
(4) The original and the owner's duplicate
of the grantor's certificate shall be
stamped "cancelled".
(5) The deed of conveyance shall be filed
and indorsed with the number and the
place of registration of the certificate of
title of the land conveyed.
(b) If ONLY A PORTION of property is the
subject [Sec. 58, PD 1529]
(1) Include a plan which shows all the portions
already subdivided with verified and
approved technical description.
(2) That plan with the certified copy of the
technical descriptions shall be filed with
the Register of Deeds for annotation in the
TCT.
(3) Register of Deeds shall issue a TCT and
cancel the grantor's certificate partially
OR it may be cancelled totally and a
new one issued describing therein the
remaining portion
(c) If there are SUBSISTING encumbrances
and annotations:
They shall be carried over in the new
certificate or certificates; except when
they have been simultaneously
discharged.
Registration of Mortgages and Leases [Sec. 60,
PD 1529
]
Sec. 60, PD 1529 provides that mortgages and
leases shall be registered in the manner
provided in Sec. 54 (Dealings less than
ownership)
The deed shall take effect upon the title only
from the time of registration.
When a deed of mortgage is presented, the
Register of Deeds will enter upon the OCT and
upon the owners duplicate a memorandum
thereof and shall sign said memorandum.
Registration of Powers of Attorneys
[Sec. 64, PD 1529]
Powers of attorney and revocations shall be
registered with the Register of Deeds of the
province or city where the land lies.
Any instrument revoking such power shall be
registered in like manner.
Registration of Trusts
Registration is by memorandum:
(1) A memorandum by the words in trust or
upon condition or other apt words is
made if a deed or other instrument is filed
in order to:
(a) Transfer registered land in trust, or
upon any equitable condition or
limitation expressed therein, or
(b) Create or declare a trust or other
equitable interests in such land
without transfer [Sec. 65, PD 1529]
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
483
(2) A memorandum by the words with power
to sell, or power to mortgage or other
apt words is made when:
The instrument creating or declaring a
trust or other equitable interest contains
an EXPRESS POWER to sell, mortgage, or
deal with the land in any manner
However, if an implied or constructive trust is
claimed, person claiming such must execute a
sworn statement thereof with the Register of
Deeds, containing a description of the land,
the name of the registered owner and a
reference to the number of the certificate of
title. Such claim shall not affect the title of a
purchaser for value and in good faith before its
registration. [Sec. 68, PD 1529]
D. INVOLUNTARY DEALINGS
The following involuntary dealings affecting
registered land must be registered:
(1) Attachments [Sec. 69, PD 1529]
(2) Sale on execution or for taxes or for any
assessment [Sec. 74, PD 1529]
(3) Adverse claim [Sec. 70, PD 1529]
(4) Notice of lis pendens [Sec. 76, PD 1529]
Registration of Attachment
Attachment is a writ issued at the institution or
during progress of an action commanding the
sheriff to attach the property, rights, credits or
effects of the defendant to satisfy demands of
the plaintiff.
Kinds
(1) Preliminary
(2) Garnishment
(3) Levy on execution
Process of Registration
(1) Copy of writ in order to preserve any lien,
right or attachment upon registered land
shall be filed with the Register of Deeds
where the land lies, containing number of
certificate of title of land to be affected or
description of land [PD 1529, Sec 69]
(2) Register of Deeds to index attachment in
names of both plaintiff & defendant or
name of person whom property is held or
in whose name stands in the records
(a) If duplicate of certificate of title is not
presented:
(i) Register of Deeds shall within 36
hours send notice to registered
owner by mail stating that there
has been registration & requesting
him to produce duplicate so that
memorandum be made
(ii) If owner neglects or refuses
Register of Deeds shall report
matter to court.
(b) Court after notice shall enter an order
to owner to surrender certificate at
time & place to be named therein.
(3) Although notice of attachment is not noted
in duplicate, notation in book of entry of
Register of Deeds produces effect of
registration already
Effect of registration of attachment
(1) Creates real right
(2) Has priority over execution sale
(3) But between 2 attachments one that is
earlier in registration is preferred
Duty of Register of Deeds - Duty is ministerial
but may refuse registration in the following
circumstances:
(1) Title to land is not in the name of
defendant
Exception: If petitioner is an heir
(2) No evidence is submitted to show that he
has present or possible future interest in
land
REGISTRATION OF EXECUTION AND TAX
DELINQUENCY SALES
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
484
Execution sale
(1) To enforce a lien of any description on
registered land, any execution or affidavit
to enforce such lien shall be filed with
Register of Deeds where the land lies
(2) Register in the registration book &
memorandum upon proper certificate of
title as adverse claim or as an
encumbrance
(3) To determine preferential rights between 2
liens: priority of registration of attachment
Tax sale
(a) Sale of land for collection of delinquent
taxes and penalties due the Government
(b) In personam (all persons interested shall
be notified so that they are given
opportunity to be heard)
(1) Notice to be given to delinquent tax
payer at last known address
(2) Publication of notice must also be
made in English, Spanish & local
dialect & posted in a public &
conspicuous place in place wherein
property is situated & at the main
entrance of the provincial building
(c) Sale cannot affect rights of other lien
holders unless they are given the right to
defend their rights: due process must be
strictly observed
(d) Tax lien superior to attachment
Note: No need to register tax lien because
it is automatically registered once the tax
accrues. However sale of registered land to
foreclose a tax lien needs to be registered.
Process of Registration
(1) Officers return shall be submitted to
Register of Deeds together with duplicate
title
(2) Register in the registration book
(3) Memorandum shall be entered in the
certificate as an adverse claim or
encumbrance
(4) After the period of redemption has expired
& no redemption (2 years from registration
of auction sale) is made: cancellation of
title & issuance of a new one
(5) Before cancellation, notice shall be sent to
registered owner: to surrender title & show
cause why it shall not be cancelled
Note: Actual knowledge is equivalent to
registration
Registration of Notice Lis Pendens
Purpose of notice of lis pendens: To keep the
subject matter within the power of the court
until the entry of final judgment. It therefore
creates merely a contingency & not a lien.
When notice of lis pendens is proper:
(1) To recover possession of real estate
(2) To quiet title
(3) To remove clouds upon the title thereof
(4) For partition
(5) Other proceedings of any kind in court
directly affecting the title to land or the use
or occupation thereof or the buildings
thereon
When notice of lis pendens is NOT proper:
(1) Proceedings for the recovery of money
judgments
(2) Attachments
(3) Proceedings on the probate of wills
(4) Administration of the estate of deceased
persons
(5) Levies on execution
(6) Foreclosure
Process of Registration: By Memorandum or
Notice stating
(1) The institution of the action or proceeding
(2) The court wherein the same is pending
(3) The date of the institution of the action
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
485
(4) Reference to the number of the certificate
of title
(5) Adequate description of the land affected
and registered owner thereof
Other parties who need to register
(1) Assignee in involuntary proceeding for
insolvency
(a) Duty of the officer serving notice to file
a copy of the notice to the Register of
Deeds where the property of debtor
lies
(b) Assignee elected or appointed by court
shall be entitled to entry of new
certificate of registered land upon
presentment of copy of assignment
with bankrupts certificate of title
(duplicate)
(c) New certificate shall note that it is
entered to him as assignee or trustee in
insolvency proceedings
(2) Government in eminent domain
(a) Copy of judgment shall be filed in the
Register of Deeds which states
description of property, certificate
number, interest expropriated, nature
of public use
(b) Memorandum shall be made or new
certificate of title shall be issued
Effect of registration
(1) Impossibility of alienating the property in
dispute during the pendency of the suit
may be alienated but purchaser is subject
to final outcome of pending suit
(2) Register of Deeds is duty bound to carry
over notice of lis pendens on all new titles
to be issued
Cancellation of lis pendens
[PD 1529, Sec. 77]
(1) Before final judgment court may order
cancellation after showing that notice is
only for the purpose of molesting an
adverse party or it is not necessary to
protect the rights of the party who caused
it to be registered
(2) Register of Deeds may also cancel upon
verified petition of the party who caused
such registration
(3) Deemed cancelled when certificate of clerk
of court stating manner of disposal of
proceeding is registered
Registration of Adverse Claim
A claim is adverse when: [Sec. 70, par. 1, PD
1529
]
(1) Claimants right or interest in registered
land is adverse to the registered owner,
and
(2) Such right arose subsequent to date of
original registration, and
(3) No other provision is made in the Decree
for the registration of such right or
claimant
Requisites for registration of an adverse claim:
(1) The adverse claimant must give a
statement of the following in writing:
(a) His alleged right or interest
(b) How and under whom such alleged
right or interest is acquired
(c) The description of the land in which the
right or interest is claimed and
(d) The number of the certificate of title
(2) The statement must be:
(a) Signed by the adverse claimant
(b) Sworn before a notary public
(3) The statement must also state his
residence or the place to which all notices
may be served upon him.
Duration of an adverse claim
(a) 30 days from the date of registration.
(b) After that the annotation of adverse claim
may be cancelled upon filing of a verified
petition by the party in interest.
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
486
(c) When cancelled, no second adverse claim
based on the same ground may be
registered by the same claimant.
VIII. Non-Registrable
Properties
All lands of the public
domain, waters,
minerals, coal,
petroleum, and other
mineral
oils, all forces of
potential energy,
fisheries,
forests or timber,
wildlife, flora and fauna,
and
other natural resources
are owned by the
State. [Sec. 2, Art. XII,
1987 Constitution]

With the exception of

agricultural lands, all
other natural resources
shall not be alienated.
[Sec. 2, Art. XI, 1987
Constitution]

The classification of public lands is an

exclusive prerogative of the Executive
Department of the Government and not of the
courts. In the absence of such classification,
the land remains as unclassified land until it is
released therefrom and rendered open to
disposition. [Aquino, p. 41, citing Dir. Of Lands
and Dir. Of Forest Development v. CA, 129
SCRA 689, 1984
]
Civil Code provisions dealing with nonregistrable properties
(1) Properties of public dominion [Art. 420,
Civil Code
]
(a) Those intended for public use, such as
roads, canals, rivers, torrents, ports
and bridges constructed by the State,
banks, shores, roadsteads, and others
of similar character;
(b) Those which belong to the State,
without being for public use, and are
intended for some public service or for
the development of the national
wealth.
(2) Waters under Art. 502, Civil Code
(a) Rivers and natural beds
(b) Continuous or intermittent waters of
springs and brooks running in their
natural beds and the beds themselves
(c) Waters rising continuously or
intermittently on lands of public
dominion
(d) Lakes and lagoons formed by Nature
on public lands, and their beds
(e) Rain waters running through ravines or
sand beds, which are also part of
public dominion;
(f) Subterranean waters on public lands
(g) Waters found within the zone of
operation of public works, even if
constructed by a contractor
(h) Waters rising continuously or
intermittently on lands belonging to
private persons, to the State, to a
province, or to a city or municipality
from the moment they leave such
lands
(i) The waste waters of fountains, sewers,
and public establishments
Specific kinds of non-registrable properties or
lands
(1) Forest or timberland, public forest, forest
reserves
(2) Mangrove swamps - Mangrove swamps or
mangroves should be understood as
comprised within the public forests of the
Philippines as defined in Sec. 1820,
Administrative Code of 1917. [Dir. Of
Forestry v. Villareal, 170 SCRA 598, 1980]
(3) Mineral lands - Both under the 1987
Constitution and Sec. 2 of the Public Land
Act, mineral lands are not alienable and
disposable. [Lepanto Consolidated Mining
Co. v. Dumyung, 89 SCRA 532, 1979]
(4) Foreshore land and seashore - Seashore,
foreshore, and/or portions of territorial
waters and beaches, cannot be registered.
Even alluvial formation along the seashore
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
487
is part of public domain. [Aquino, p. 45,
citing Dizon v. Rodriguez, 13 SCRA 704,
1965
]
(5) Lakes - Lakes are part of public dominion.
[Art. 502(4), Civil Code]
(6) Military Reservations - The reservation
made segregates it from the public domain
and no amount of time in whatever nature
of possession could have ripen such
possession into private ownership.
[Republic v. Marcos, 52 SCRA 238, 1973]
(7) Watershed - The Constitution expressly
mandates the conservation and utilization
of natural resources, which includes the
countrys watershed. [Tan v. Dir. Of
Forestry, 125 SCRA 302, 1983]
(8) Grazing lands - While the 1987 Constitution
does not specifically prove that grazing
lands are not disposable, yet if such lands
are part of a forest reserve, there can be no
doubt that the same are incapable of
registration. [Aquino, p. 49, citing Dir. Of
Lands v. Rivas
]
(9) Previously titled land - Proceeds from the
indefeasibility of the Torrens title.
(10)Alluvial deposit along river when manmade - Such deposit is really an
encroachment of a portion of the bed of
the river, classified as property of the
public domain under Art. 420, par. 1 and
Art. 502 (1) of the Civil Code, hence not
open to registration. [Republic v. CA, 132
SCRA 514, 1984
]
The land registration court has no jurisdiction
over non-registrable property and cannot
validly adjudge the registration of title thereof
in favor of a private applicant. [Pena, p. 105]
Thus, where it has so been adjudged, the river
not being capable of private appropriation or
acquisition by prescription, the title thereto
may be attacked, either directly or collaterally,
by the State which is not bound by any
prescriptive period provided by the Statute of
Limitation. [Pena citing Martinez v. CA, GR No.
L-31271, 1974
]
IX. Dealings With
Unregistered Lands
No deed, conveyance, mortgage, lease, or
other voluntary instrument affecting land not
registered under the Torrens system shall be
valid, except as between the parties thereto,
unless such instrument shall have been
recorded in the manner herein prescribed in
the office of the Register of Deeds for the
province or city where the land lies. [Sec. 113,
par. 1, PD 1529]
EFFECTS OF TRANSACTIONS COVERING
UNREGISTERED LAND
(1) As between the parties The contract is
binding and valid even if not registered
(2) As among third persons There must be
registration for the transaction to be
binding against third persons
PRIMARY ENTRY BOOK AND
REGISTRATION BOOK
The Register of Deeds for each province or city
shall keep a Primary Entry Book and a
Registration Book.
(1) The Primary Entry Book shall contain,
among other particulars:
(a) Entry number
(b) Names of the parties
(c) Nature of the document
(d) Date, hour and minute it was
presented and received
(2) The Registration Book Provides spaces
whereon the annotation is made after the
instrument has been entered in the
Primary Entry Book
UP LAW BOC LAND TITLES AND DEEDS CIVIL LAW
488
Process of Registration
(1) Registration is by way of annotation
(2) The instrument dealing with unregistered
land is presented before the Register of
Deeds
(3) The Register will then determine if it can
be registered:
(a) If, on the face of the instrument, it
appears that it is sufficient in law, the
Register of Deeds shall forthwith
record the instrument
(b) In case the Register of Deeds refuses
its administration to record, he shall
advise the party in interest in writing of
the ground or grounds for his refusal
The latter may appeal the matter to
the Commissioner of Land
Registration
Third Party with a better right NOT prejudiced
It shall be understood that any recording made
under this section shall be without prejudice to
a third party with a better right. [Sec. 113, PD
1529
]
Better right refers to a right which must have
been acquired by a third party independently
of the unregistered deed, such, for instance, as
title by prescription, and that it has no
reference to rights acquired under that
unregistered deed itself. [Pena, p. 600]
Involuntary dealings in unregistered lands
PD 1529 now permits the registration of
involuntary dealings in unregistered lands.
Tax sale, attachment and levy, notice of lis
pendens, adverse claim and other instruments
in the nature of involuntary dealings with
respect to unregistered lands, if made in the
form sufficient in law, shall likewise be
admissible to record under Sec. 113. [Sec. 113
(d), PD 1529]
UP LAW BOC TORTS CIVIL LAW
489

CIVIL LAW
TORTS
UP LAW BOC TORTS CIVIL LAW
490
I. Preliminary
Considerations
A. DEFINITION OF TORT
A.1. ACCORDING TO MANNER OF
COMMISSION
(1) Negligent Tort consists in the failure to
act according to the standard of diligence
required under the attendant
circumstances. It is a voluntary act or
omission which results in injury to others,
without intending to cause the same.
Note: While the term tort has been used
interchangeably with the term quasidelict, the latter merely represents an
area of tort law concerned with damage
resulting from fault (by doing a positive act
constituting negligence) or negligence (by
omitting to do an act due to negligence) of
the defendant.
(2) Intentional Tort perpetrated by one who
intends to do that which the law has
declared to be wrong. It is conduct where
the actor desires to cause the
consequences of the act, or that he
believes that the consequences are
substantially certain to result therefrom.
(3) Strict Liability one is liable independent
of fault or negligence. It only requires proof
of a certain set of facts. Liability here is
based on the breach of an absolute duty to
make something safe. It most often
applies to ultra-hazardous activities or in
product liability cases. It is also known as
absolute liability or liability without
fault.
Strict liability is imposed by articles 1314,
1711, 1712, 1723, 2183, 2184, 2187, 2189,
2190, 2191, 2192, 2193.
A.2. ACCORDING TO SCOPE
(1) General Tort liability is based on any of
the three categories: intentional,
negligent, strict liability
(2) Specific Includes trespass, assault,
battery, negligence, products liability, and
intentional infliction of emotional distress
B. DEFINITION OF QUASI-DELICT
Art. 2176. Whoever by
act or omission causes
damage to another,
there being fault or
negligence, is obliged to
pay for the damage
done. Such fault or
negligence, if there is no
pre-existing contractual
relation between the
parties, is called a quasi-
delict and is governed
by the provisions of this
Chapter.
Quasi-delict, known in Spanish legal treatises
as culpa aquiliana, is a civil law concept while
torts is an Anglo-American or common law
concept. Torts is much broader than culpa
aquiliana because it includes not only
negligennce, but intentional criminal acts such
as assualt and battery, false imprisonment and
deceit. In the general scheme of the Philippine
legal system envisioned by the Commission
responsible for drafting the New Civil Code,
intentional and malicious acts with certain
exceptopms, are to be governed by the Revised
Penal Code while negligent acts or omissions
are to be covered by Article 2176 of the Civil
Code. In between these opposite spectrums
are injurious acts which, in the absence of
Article 21, would have been beyond redress.
Thus, Article 21 fills that vacuum [Baksh v. CA
(1993)].
Cangco v. Manila Railroad (1918): The concept
of quasi-delict does not cover intentional acts.
The liability arising from from extracontractual culpa is always based upon a
voluntary act or omission, which, without
willful intent, but by mere negligence or
inattention, has caused damage to another.
UP LAW BOC TORTS CIVIL LAW
491
Cinco v. Canonoy (1979): The concept of quasidelict is so broad that it includes
not only
injuries to persons but also damage to
property.
C. CULPA AQUILIANA
DISTINGUISHED FROM CRIME
A quasi-delict is a separate source of
obligation under Article 1157.
Art. 2177.
Responsibility for fault or
negligence
under the preceding
article is entirely
separate
and distinct from the
civil liability arising from
negligence under the
Penal Code. But the
plaintiff cannot recover
damages twice for the
same act or omission of
the defendant.

RPC, Art. 100. Every

person criminally liable
for a felony is also civilly
liable.

Barredo v. Garcia (1942): A quasi-delict or

culpa aquiliana is a separate legal institution
under the Civil Code, with a substantivity all its
own, and individuality that is entirely apart and
independent from a delict or crime. However,
the same negligent act causing damage may
produce civil liability arising from a crime
under Article 100 of the Revised Penal Code, or
create an action for quasi-delict.
L.G. Foods v. Philadelfa (2006): An act or
omission causing damage to another may give
rise to two separate civil liabilities on the part
of the offenderfor civil liability ex delicto, and
independent civil liabilities. The choice is with
the plaintiff who makes known his cause of
action in his initiatory pleading or complaint.
D. CULPA AQUILIANA
DISTINGUISHED FROM CULPA
CONTRACTUAL; PRESENCE OF
CONTRACTUAL RELATIONS
D.1. AS TO SOURCE
In Culpa Aquiliana or non-contractual
obligation, it is the wrongful or negligent act or
omission itself which creates the vinculum
juris, whereas in contractual relations, the
vinculum exists independently of the breach of
voluntary duty assumed by the parties when
entering into the contractual relation [Cangco
v. Manila Railroad (1918)].
D.2. AS TO BURDEN OF PROOF
When the source of the obligation upon which
the plaintiffs cause of action depends is a
negligent act or omission, the burden of proof
rests upon the plaintiff to prove the
negligenceif he does not his action fails. But
when the facts averred show a contractual
undertaking by defendant for the benefit of the
plaintiff, and it is alleged that the plaintiff has
failed or refused to perform the contract, it is
not necessary for the plaintiff to specify in his
pleadings whether the breach of the contract is
due to willful fault or to negligence on the part
of the defendant, or of his servants or agents.
Proof of the contract and of its
nonperformance is sufficient prima facie to
warrant a recovery. [Cangco v. Manila Railroad
(1918)].
D.3. AS TO APPLICABILITY OF THE
DOCTRINE OF PROXIMATE CAUSE
The doctrine of proximate cause [to establish
the fault or negligence of the defendant] is
applicable only in actions for quasi-delict, not
in actions involving breach of contract [Calalas
v. CA (2000)].
UP LAW BOC TORTS CIVIL LAW
492
D.4. AS TO THE DEFENSE OF AN
EMPLOYER FOR THE NEGLIGENCE OF
AN EMPLOYEE
As it is not necessary for the plaintiff in an
action for breach of contract to show that the
breach was due to the negligent conduct of the
defendant or his servants, proof on the part of
the defendant that the negligence or omission
of his servants or agents caused the breach of
contract would not constitute a defense to the
action [Cangco v. Manila Railroad (1918)].
Presence of Contactual Relations
The Supreme Court held there may instances
where there can be a quasi-delict even when
there is a contract between the parties. The
test (whether a quasi-delict can be deemed to
underlie the breach of a contract) can be
stated thusly: Where, without a pre-existing
contract between two parties, an act or
omission can nonetheless amount to an
actionable tort by itself, the fact that the
parties are contractually bound is no bar to the
application of quasi-delict provisions to the
case [Far East v. CA (1995)].
II. QUASI-DELICT
Elements: [PNR v. Brunty (2006)]
(a) Damage to the plaintiff
(b) Negligence by act/omission of the
defendant
(c) Connection of the cause and effect
between the fault/negligence of the
defendant and the damage incurred by the
plaintiff.
A. NEGLIGENCE
Art. 1173. The fault or
negligence of the obligor
consists in the omission
of that diligence which
is required by the nature
of the obligation and
corresponds with the
circumstances of the
persons, of the time and
of the place. When

negligence shows bad

faith, the provisions of
Articles 1171 and 2201,
paragraph 2, shall
apply.
If the law or contract
does not state the
diligence which is to be
observed in the
performance, that which
is expected of a good
father of a family shall
be required.

Negligence is the omission to do something

which a reasonable man, guided by those
considerations which ordinarily regulate the
conduct of human affairs, would do, or the
doing of something which a prudent and
reasonable man would not do [Layugan v. IAC
(1988)].
Jorge v. Sicam (2007): The diligence with
which the law requires the individual to at all
times govern his conduct varies with the nature
of the situation in which he is placed and the
importance of the act which he is to perform.
To determine whether there has been
negligence by the defendant, this 2-step
analysis may be used: 1) determine the
diligence required of the actor under the
circumstances, and 2) determine whether the
actor has performed the diligence required.
Failing the second step would lead to the
conclusion that the defendant has been
negligent.
Amedo v. Rio (1954): By jumping into the sea,
the employee failed to exercise even slight care
and diligence and displayed a reckless
disregard of the safety of his person. His death
was caused by his notorious negligence.
Notorious negligence has been held to be
tantamount to gross negligence which is want
of even slight care and diligence.
A.1. DEFAULT STANDARD OF CARE:
GOOD FATHER OF A FAMILY
Picart v. Smith (1918):
UP LAW BOC TORTS CIVIL LAW
493
Test: Did the defendant in doing the alleged
negligent act use that reasonable care and
caution which an ordinarily prudent man
would have used in the same situation? If not,
then he is negligent. Negligence in a given
case is not determined by reference to the
personal judgment of the actor in the situation
before him, but is determined in the light of
human experience and the facts involved in the
particular case. Conduct is said to be negligent
when a prudent man in the position of the
tortfeasor would have foreseen that an effect
harmful to another was sufficiently probable to
warrant his foregoing the conduct or guarding
against its consequences.
A.2. STANDARD OF CARE NEEDED IN
SPECIFIC CIRCUMSTANCES
(1) Operators of Motor Vehicles
Anonuevo v CA (2004): Because of
inherent differences between motorists
and cyclists, the former being capable of
greater speed and destruction, operators
of motor vehicles have a higher standard in
his duty of care.
(2) Banks
Consolidated Bank v CA (2003): The law
imposes on banks high standards in view
of the fiduciary nature of banking. Section
2 of Republic Act No. 8791 (RA 8791),
which took effect on 13 June 2000,
declares that the State recognizes the
fiduciary nature of banking that requires
high standards of integrity and
performance. This fiduciary relationship
means that the banks obligation to
observe high standards of integrity and
performance is deemed written into every
deposit agreement between a bank and its
depositor. The fiduciary nature of banking
requires banks to assume a degree of
diligence higher than that of a good father
of a family.
(3) Experts (In General)
Far Eastern Shipping v CA (1998): Those
who undertake any work calling for special
skills are required not only to exercise
reasonable care in what they do but also
possess a standard minimum of special
knowledge and ability. In all employments
where peculiar skill is requisite, one who
offers his services is understood as holding
himself out to the public as possessing the
degree of skill commonly possessed by
others in the same employment.
Culion v Philippine Motors (1930): When a
person holds himself out as being
competent to do things requiring
professional skill, he will be held liable for
negligence if he fails to exhibit the care
and skill of one ordinarily skilled in the
particular work which he attempts to do.
(4) Doctors
Cruz v. CA (1997): Whether or not a
physician has committed an inexcusable
lack of precaution in the treatment of his
patient is to be determined according to
the standard of care observed by other
members of the profession in good
standing under similar circumstances
bearing in mind the advanced state of the
profession at the time of treatment of
present state of medical science. It is in this
aspect of medical malpractice that expert
testimony is essential to establish not only
the standard of care of the profession but
also that the physicians conduct in the
treatment and care falls below such
standard.
(5) Pharmacists
US v. Pineda (1918): The profession of
pharmacy, it has been said again and
again, is one demanding care and skill.
Even under the first conservative
expression, "ordinary care" with reference
UP LAW BOC TORTS CIVIL LAW
494
to the business of a druggistmust be held
to signify "the highest practicable degree
of prudence, thoughtfulness, and vigilance,
and most exact and reliable safeguards
consistent with the reasonable conduct of
the business in order that human life may
not constantly be exposed to the danger
flowing from the substitution of deadly
poisons for harmless medicine.
Mercury Drug v De Leon (2008): Mistake is
negligence and care is no defense.
(6) Possessor of Extremely Dangerous
Instrumentalities
Pacis v Morales (2010): Indeed, a higher
degree of care is required of someone who
has in his possession or under his control
an instrumentality extremely dangerous in
character, such as dangerous weapons or
substances. Such person in possession or
control of dangerous instrumentalities has
the duty to take exceptional precautions to
prevent any injury being done thereby.
Unlike the ordinary affairs of life or
business which involve little or no risk, a
business dealing with dangerous weapons
requires the exercise of a higher degree of
care.
(7) Children
Taylor v. Manila Railroad (1910): The
conduct of an infant of tender years is not
to be judged by the same rule, which
governs that of an adult. The care and
caution required of a child is according to
his maturity and capacity only, and this is
to be determined in each case by the
circumstances of the case.
Jarco Marketing v. CA (1999): No
contributory negligence can be imputed to
children below 9 years old.
Ylarde v. Aquino (1988): The degree of care
required to be exercised must vary with the
capacity of the person endangered to care
for himself. The standard of conduct to
which a child must conform for his own
protection is that degree of care ordinarily
exercised by children of the same age,
capacity, discretion, knowledge and
experience under the same or similar
circumstances.
(8) In case of insane persons
US v. Baggay (1911): A lunatic or insane
person who, in spite of his irresponsibility
on account of the deplorable condition of
his deranged mind, is still reasonably and
justly liable with his property for the
consequences of his acts.
A.3. PRESUMPTIONS OF NEGLIGENCE
i. IN MOTOR VEHICLE MISHAPS
(1) Liability of the owner
Art. 2184. In motor
vehicle mishaps, the
owner
is solidarily liable with
his driver, if the former,
who was in the vehicle,
could have, by the use
of the due diligence,
prevented the
misfortune.
xxx
If the owner was not in
the motor vehicle, the
provisions of article
2180 are applicable.

Art. 2186. Every owner

of a motor vehicle
shall file with the proper
government office a
bond executed by a
government-controlled
corporation or office, to
answer for damages
to third persons. The
amount of the bond and
other terms shall be
fixed by the competent
public official.

Owner shall mean the actual legal owner of

the motor vehicle, in whose name such vehicle
is duly registered with the LTO. Registration of
motor vehicles is required not because it is the
operative act which transfers ownership in
UP LAW BOC TORTS CIVIL LAW
495
vehicles, but because it is the means by which
the owner can be identified so that if any
accident occurs, or damage or injury is caused
in the operation of the vehicle, responsibility
can be fixed.
The owner is solidarily liable with the driver for
motor vehicle mishaps when:
(a) The owner was IN the vehicle at the time,
AND
(b) The owner could have, by the use of due
diligence, prevented the misfortune.
Note: If the owner was NOT inside the vehicle,
Art. 2180 applies.
The presumption is against the owner of the
motor vehicle. He has the burden of proving
due diligence. Thus, once a driver is proven
negligent in causing damage, the law
presumes the vehicle owner equally negligent
and imposes upon the latter the burden of
proving proper selection and supervision of
employee as a defense.
As held in Vargas v. Langcay (1962), the
registered owner/operator of a passenger
vehicle is jointly and severally liable with the
driver for damages incurred by passengers or
third persons as a consequence of injuries or
death sustained in the operation of said
vehicles. Regardless of who the actual owner
of a vehicle is, the operator of record continues
to be the operator of the vehicle as regards the
public and third persons and as such is directly
and primarily responsible for the consequences
incident to its operation, so that in
contemplation of law, such owner/operator of
record is the employer of the driver, the actual
operator and employer being considered
merely as his agent.
Tamayo v. Aquino (1959): The registered owner
of a motor vehicle is primarily liable for the
damage or injury caused to another, but he has
a right to be indemnified by the real owner of
the amount he was required to pay. This rule
applies both to private and to common carriers
with respect to their passengers.
Caedo v. Yu Khe Tai (1968): The law does not
require that a person must possess a certain
measure of skill or proficiency either in the
mechanics of driving or in the observance of
traffic rules before he may own a motor
vehicle. The test of his negligence, within the
meaning of Article 2184, is his omission to do
that which the evidence of his own senses tells
him he should do in order to avoid the
accident. And as far as perception is
concerned, absent a minimum level imposed
by law, a maneuver that appears to be fraught
with danger to one passenger may appear to
be entirely safe and commonplace to another.
Were the law to require a uniform standard of
perceptiveness, employment of professional
drivers by car owners who, by their very
inadequacies, have real need of drivers'
services, would be effectively proscribed.
Duavit v. CA (1989): An owner of a vehicle
cannot be held liable for an accident involving
the said vehicle if the same was driven without
his consent or knowledge and by a person not
employed by him.
Chapman v. Underwood (1914): The owner of
the motor vehicle is not liable for the
misfortune unless the negligent acts of the
driver are continued for such a length of time
as to give the owner a reasonable opportunity
to observe them and to direct his driver to
desist therefrom. The act complained of must
be continued in the presence of the owner for
such a length of time that the owner, by his
acquiescence, makes his drivers act his own.
(2) Liability of the driver
Art. 2184. xxx It is
disputably presumed
that a
driver was negligent, if
he had been found

UP LAW BOC TORTS CIVIL LAW

496
guilty of reckless driving
or violating traffic
regulations at least
twice within the next
preceding two months.

Art. 2185. Unless there

is proof to the
contrary, it is presumed
that a person driving
a motor vehicle has
been negligent if at the
time of the mishap, he
was violating any
traffic regulation.
Article 2184 establishes a presumption of
negligence on the part of the driver based on
previous violations of traffic regulations. Article
2185 establishes a presumption of negligence
on the basis of simultaneous violations.
Sanitary Steam v. CA (1998): Despite the
presumption of negligence arising from the
traffic regulation violation, the claimant must
still prove that such negligence was the
proximate cause in order to successfully claim
for damages.
Aonuevo v. CA (2004): Article 2185 was not
formulated to compel or ensure obeisance by
all to traffic rules and regulations. It does not
apply to non-motorized vehicles, in recognition
of the unequal footing of standards applicable
to motor vehicles as opposed to other types of
vehicles.
ii. POSSESSION OF DANGEROUS
WEAPONS OR SUBSTANCES
Art. 2188. There is
prima facie presumption
of
negligence if the death
or injury results from
his possession of
dangerous weapons or
substances, such as
firearms and poison,
except when the use or
possession thereof is
indispensable in his
occupation or business.

iii. COMMON CARRIERS

Art. 1735. In all cases
other than those
mentioned in Nos. 1, 2,
3, 4, and 5 of the
preceding article
(calamity, act of public
enemy

in war, act of owner of

the goods, character of
the goods, order of
competent public
authority), if the goods
are lost destroyed or
deteriorated, common
carriers are presumed
to have been at fault or
to have acted
negligently, unless they
prove that they
observed extraordinary
diligence as required
under Art. 1733.

Art. 1752. Even when

there is an agreement
limiting the liability of
the common carrier in
the vigilance over the
goods, the common
carrier is disputably
presumed to have been
negligent in case of their
loss, destruction or
deterioration.

iv. RES IPSA LOQUITUR

The doctrine of res ipsa loquitur (the thing or
the transaction speaks for itself) is a rule of
evidence (not of substantive law) peculiar to
the law of negligence. The doctrine treats the
injury itself as proof of negligence.
Elements: [Ramos v. CA (1999)]
(a) The accident is of a kind which ordinarily
does not occur in the absence of someones
negligence;
(b) It is caused by an instrumentality within
the exclusive control of the defendant or
defendants; and
(c) The possibility of contributing conduct,
which would make the plaintiff
responsible, is eliminated.
Basis
DM Consunji v. CA (2001): The res ipsa loquitur
doctrine is based in part upon the theory that
the defendant in charge of the instrumentality
which causes the injury either knows the cause
of the accident or has the best opportunity of
ascertaining it and that the plaintiff has no
such knowledge, and therefore is compelled to
allege negligence in general terms and to rely
upon the proof of the happening of the
accident in order to establish negligence.
UP LAW BOC TORTS CIVIL LAW
497
Effect
Ramos v. CA, supra: The fact of the occurrence
of an injury, taken with the surrounding
circumstances, raise a presumption of
negligence, or make out a plaintiffs prima
facie case, and present a question of fact for
defendant to meet with an explanation.
In medical malpractice cases, when the
doctrine of res ipsa loquitur is availed by the
plaintiff, the need for expert medical testimony
is dispensed with because the injury itself
provides the proof of negligence. The reason is
that the general rule on the necessity of expert
testimony applies only to such matters clearly
within the domain of medical science, and not
to matters that are within the common
knowledge of mankind which may be testified
to by anyone familiar with the facts.
Note: For the res ipsa loquitur doctrine to
apply, it must appear that the injured party
had no knowledge as to the cause of the
accident, or that the party to be charged with
negligence has superior knowledge or
opportunity for explanation of the accident.
A.4. PERSONS LIABLE
(1) The direct tortfeasor
Art. 2176. Whoever by
act or omission causes
damage to another,
there being fault or
negligence, is obliged to
pay for the damage
done. xxx

The tortfeasor may be a natural or juridical

person. For natural persons, apply requisites of
Art. 2176 and for juridical persons, apply
vicarious liability provisions.
(2) Persons vicariously liable
Art. 2180. The
obligation imposed by
Article
2176 is demandable not
only for ones own
acts or omissions, but
also for those of
persons for whom one is
responsible.

xxx
The responsibility
treated of in this article
shall cease when the
persons herein
mentioned prove that
they observed all the
diligence of a good
father of a family to
prevent the damage.

Also referred to as the doctrine of imputed

negligence. The rationale is to extend liability
by legal fiction to those in a position to exercise
absolute or limited control over the direct
tortfeasor. The doctrine does not apply where
moral culpability can be imputed directly, as
when there is actual intent to cause harm to
others.
The liability of the vicarious obligor is primary
and direct (solidarily liable with the tortfesor),
not subsidiary. His responsibility is not
conditioned upon the insolvency of or prior
recourse against the negligent tortfeasor.
Under Article 2180
Persons Vicariously
Actor
Liable
Father and, in case
Minor children who live
of his death or
in
incapacity, the
their company
mother
Minors or incapacitated
persons who are under
Guardians their authority and live
in
their company
Employees in the service
of
Owners and the branches in which
managers of an the
establishment or latter are employed or
enterprise on
the occasion of their
functions
Employers Employees and
household
helpers acting within the
 scope of their assigned

UP LAW BOC TORTS CIVIL LAW

498
tasks, even though the
former are not engaged in
any business or industry
State Special agent
Pupils and students or
Teachers or heads
apprentices, so long as
of establishments
they remain in their
of arts and trades
custody

(a) Persons exercising parental authority

Art. 2180 (2). The
father and, in case of his
death or incapacity, the
mother, are
responsible for the
damages caused by the
minor children who live
in their company.

FC, Art. 221. Parents

and other persons
exercising parental
authority shall be civilly
liable for the injuries and
damages caused by
the acts or omissions of
their unemancipated
children living in their
company and under
their parental authority
subject to the
appropriate defenses
provided by law.

FC, Art. 216. In default

of parents or a
judicially appointed
guardian, the following
person shall exercise
substitute parental
authority over the child
in the order
indicated:
(1) The surviving
grandparent, as
provided in
Art. 214;
(2) The oldest brother or
sister, over twenty
one years of age, unless
unfit or
disqualified; and
(3) The child's actual
custodian, over twenty
one years of age, unless
unfit or
disqualified.
Whenever the
appointment or a judicial
guardian over the
property of the child
becomes necessary, the
same order of
preference shall be
observed.

FC, Art. 217. In case of

foundlings,
abandoned neglected or
abused children
and other children
similarly situated,
parental authority shall
be entrusted in
summary judicial
proceedings to heads of

children's homes,
orphanages and similar
institutions duly
accredited by the proper
government agency.

Art 2180, par 2 of the Civil Code which holds

the father liable for damages has been
modified by the Family Code and PD 603. Art.
211 of the FC declares joint parental authority
of the mother and father over common
children. The parent(s) exercising parental
authority are liable for the torts of their
children.
Who are liable for minors?
(1) Parents/Adoptive parents
(2) Court-appointed guardians
(3) Substitute Parental Authorities
(a) Grandparents
(b) Oldest qualified sibling over 21 years
old
(c) Childs actual custodian, provided he is
qualified and over 21 years old.
(4) Special Parental Authorities
(a) School
(b) Administrators
(c) Teachers
(d) Individual, entity, or institution
engaged in child care
Illegitimate children
Responsibility is with the mother whom the
law vests with parental authority.
Basis of liability of parents and adopters
Parental liability is anchored upon parental
authority coupled with presumed parental
dereliction in the discharge of the duties
accompanying such authority. The parental
dereliction is, of course, only presumed and the
presumption can be overturned under Article
2180 of the Civil Code by proof that the parents
had exercised all the diligence of a good father
of a family to prevent the damage [Tamargo v.
CA (1992)].
UP LAW BOC TORTS CIVIL LAW
499
Meaning of Minority
Par. 2 and 3 of Art. 2180 speak of minors.
Minors here refer to those who are below 21
years of age, not below 18 years. The law
reducing the majority age from 21 to 18 years
old did not amend these paragraphs. Basis is
FC, Art. 236 (3), as amended by RA 6809,
provides, Nothing in this Code shall be
construed to derogate from the duty or
responsibility of parents and guardians for
children and wards below 21 years of age
mentioned in the second and third paragraphs
of 2180 of the Civil Code.
Art. 2180 (3).
Guardians are liable for
damages
caused by the minors or
incapacitated persons
who are under their
authority and live in
their
company.
The liability of guardians with respect to their
wards is governed by the same rule as in the
liability of parents with respect to their children
below 21 years and who live with them
Incompetent includes (Rule 92, ROC):
(1) Those suffering the penalty of civil
interdiction,
(2) Prodigals,
(3) Deaf and dumb who are unable to read
and write
(4) Unsound mind, even though they have
lucid intervals
(5) Being of sound mind, but by reason of age,
disease, weak mind, and other similar
causes, cannot take care of themselves or
manage their property
Liability of minor or insane tortfeasor without a
parent or guardian
He shall be answerable with his own property
in an action against him where a guardian ad
litem shall be appointed. [Art. 2182]
(b) Teachers and schools
Art. 2180 (7). Lastly,
teachers or heads of
establishments of arts
and trades shall be
liable for damages
caused by their pupils
and
students or apprentices,
so long as they remain
in their custody.

FC, Art. 218. The

school, its
administrators
and teachers, or the
individual, entity or
institution engaged in
child are shall have
special parental
authority and
responsibility
over the minor child
while under their
supervision, instruction
or custody.
Authority and
responsibility shall apply
to all
authorized activities
whether inside or
outside the premises of
the school, entity or
institution.

FC, Art. 219. Those

given the authority and
responsibility under the
preceding Article
shall be principally and
solidarily liable for
damages caused by the
acts or omissions of
the unemancipated
minor. The parents,
judicial guardians or the
persons exercising
substitute parental
authority over said
minor
shall be subsidiarily
liable.
The respective liabilities
of those referred to
in the preceding
paragraph shall not
apply if
it is proved that they
exercised the proper
diligence required under
the particular
circumstances.
All other cases not
covered by this and the
preceding articles shall
be governed by the
provisions of the Civil
Code on quasi-delicts.

Under Article 2180, the teacher is liable for the

acts or omissions of the pupils and students,
and so is the head of establishment of arts and
trades for the apprentices, so long as they
remain in custody, regardless of age. Under
the Family Code, liability attaches to the
school, its administrators and teachers, or the
individual or entity engaged in child care, so
long as the child is under their supervision,
instruction, or custody, and the child is below
18 years old.
UP LAW BOC TORTS CIVIL LAW
500
Basis of liability of teachers and heads of
establishments of arts and trades
They stand, to a certain extent, in loco parentis
and are called upon to exercise reasonable
supervision over the conduct of the child
[Palisoc v. Brillantes (1971)].
Palisoc v. Brillante (1971): Custody means the
protective and supervisory custody that the
school, its head and teachers exercise over the
pupils, for as long as they are in attendance in
school, which includes recess time.
Amadora v. CA (1988): As long as it is shown
that the student is in the school premises
pursuant to a legitimate student objective, in
the exercise of a legitimate right, or the
enjoyment of a legitimate student privilege,
the responsibility of the school authorities over
the student continues.
(c) Owners/managers of
establishments/employers
Art. 2180 (4). The
owners and managers of
an
establishment or
enterprise are likewise
responsible for damages
caused by their
employees in the service
of the branches in
which the latter are
employed or on the
occasion of their
functions.

Art. 2180 (5).

Employers shall be liable
for
the damages caused by
their employees and
household helpers
acting within the scope
of
their assigned tasks,
even though the former
are not engaged in any
business or industry.

Philippine Rabbit v. Philam Forwarders (1975):

Owners and managers of an establishment or
enterprise does not include a manager of a
corporation. (Spanish term directores
connotes employer. But manager of a
corporation is not an employer, but rather
merely an employee of the owner.)
The liability imposed upon employers with
respect to damages occasioned by the
negligence of their employees to whom they
are not bound by contract is based on the
employers own negligence, such as when he
places a powerful automobile in the hands of a
servant whom he knows to be ignorant of the
method of managing such vehicle [Cangco v.
Manila Railroad (1918)].
Professional Services v. CA and Agana (2010):
This Court still employs the "control test" to
determine the existence of an employeremployee relationship between hospital and
doctor. Under the "control test", an
employment relationship exists between a
physician and a hospital if the hospital controls
both the means and the details of the process
by which the physician is to accomplish his
task. The Court earlier ruled that there was
employer-employee relationship between the
doctor and employee but reversed itself upon
motion for reconsideration. They still held the
hospital liable on the basis of agency and
corporate responsibility.
Filamer v. IAC (1992): Within the scope of their
assigned task in Art. 2180 includes any act
done by an employee in furtherance of the
interests, or for the account of the employer at
the time of the infliction of the injury or
damage.
Basis of liability
Employers negligence in
(1) The selection of their employees (culpa in
eligiendo)
(2) The supervision over their employees
(culpa in vigilando)
Presumption of Negligence
The presentation of proof of the negligence of
its employee gives rise to the presumption that
the defendant employer did not exercise the
diligence of a good father of a family in the
UP LAW BOC TORTS CIVIL LAW
501
selection and supervision of its employees
[Lampesa v. De Vera (2008)].
DISTINCTION BETWEEN THE 4TH AND 5TH
PARAGRAPHS OF ART. 2180
Castilex Industrial Corp. v. Vasquez (1999): A
distinction must be made between the two
provisions to determine what is applicable.
Both provisions apply to employers: the fourth
paragraph, to owners and managers of an
establishment or enterprise; and the fifth
paragraph, to employers in general, whether or
not engaged in any business or industry. The
fourth paragraph covers negligent acts of
employees committed either in the service of
the branches or on the occasion of their
functions, while the fifth paragraph
encompasses negligent acts of employees
acting within the scope of their assigned task.
The latter is an expansion of the former in both
employer coverage and acts included.
Negligent acts of employees, whether or not
the employer is engaged in a business or
industry, are covered so long as they were
acting within the scope of their assigned task,
even though committed neither in the service
of the branches nor on the occasion of their
functions. For, admittedly, employees
oftentimes wear different hats. They perform
functions which are beyond their office, title or
designation but which, nevertheless, are still
within the call of duty.
DEFENSE OF DILIGENCE IN SELECTION AND
SUPERVISION
Metro Manila Transit v. CA (1993): Due
diligence in the supervision of employees
includes the formulation of suitable rules and
regulations for the guidance of employees and
the issuance of proper instructions intended for
the protection of the public and persons with
whom the employer has relations through his
or her employees and the imposition of
necessary disciplinary measures upon
employees in case of breach or as may be
warranted to ensure performance of acts as
indispensable to the business of and beneficial
to their employee.
Due diligence in the selection of employees
require that the employer carefully examined
the applicant for employment as to his
qualifications, his experience and record of
service.
Criminal Negligence
Fernando v. Franco (1971): The vicarious
liability of the employer for criminal negligence
of his employee is governed by RPC 103.
Conviction of the employee conclusively binds
the employer. Defense of due diligence in the
selection and supervision of the employee is
not available. The employer cannot appeal the
conviction.
Note: The liability of the employer under Art.
103 RPC is subsidiary.
Registered Owner Rule
The registered owner of the vehicle is primarily
responsible to the public for whatever damage
or injury the vehicle may have caused, even if
he had already sold the same to someone else.
The policy is the easy identification of the
owner who can be held responsible so as not to
inconvenience or prejudice the third party
injured [Cadiente v. Macas (2008)]. The
registered owner, however, has the right to be
indemnified by the real or actual owner of the
amount that he may be required to pay as
damages for the injury caused to the plaintiff
[Orix Metro Leasing v. Mangalinan (2012)].
This rule applies even if the vehicle is leased to
third persons. The liability of the registered
owner is subject to his right of recourse against
the transferee or buyer.
UP LAW BOC TORTS CIVIL LAW
502
(d) The State
1987 Constitution, Art.
XVI, Sec. 3. The State
may not be sued without
its consent.

Art. 2180 (3). The State

is responsible in like
manner when it acts
through a special agent;
but not when the
damage has been
caused
by the official to whom
the task done
properly pertains, in
which case what is
provided in Article 2176
shall be applicable.

Instances where the State gives its consent to

be sued
(1) Art. 2180 (6) is an example of an express
legislative consent. Here, the State
assumes a limited liability for the acts of its
special agents.
(2) Art. 2189 provides for state liability for
damages caused by defective condition of
public works.
(3) Local Government Code provides for the
liability of local government units for
wrongful exercise of its proprietary (as
opposed to its governmental) functions.
The latter is the same as that of a private
corporation or individual. [Mendoza v. De
Leon, (1916)]
Merritt v. Government of the Philippine Islands
(1960): A special agent is one who receives a
definite and fixed order or commission, foreign
to the exercise of the duties of his office if he is
a special official. This concept does not apply
to any executive agent who is an employee of
the active administration and who on his own
responsibility performs the functions which are
inherent in and naturally pertain to his office.
A corporate body performing nongovernmental functions becomes liable for the
damage caused by the accident resulting from
the tortious act of its driver-employee. Such
corporate body assumes the responsibility of
an ordinary employer and as such, becomes
answerable for damages [Fontanilla v.
Maliaman (1991)].
(3) Joint tortfeasors
Art. 2194. The
responsibility of two or
more
persons who are liable
for quasi-delict is
solidary.

Definition of Joint Tortfeasors

Filipinas Broadcasting Network v. AMECBCCM (2005): They are all persons who
command, instigate, promote, encourage,
advise, countenance, cooperate in, aid or abet
in the commission of a tort, or who approve of
it after it is done, if done for their benefit.
Applicability of the provision
The provision applies when there are 2 or more
persons who have participated in the
commission of a single quasi-delict. The injury
must be indivisible.
B. CAUSE
Concept of Proximate Cause
In order that civil liability for negligence may
arise, there must be a direct causal connection
between the damage suffered by the plaintiff
and the act or omission of the defendant.
Where the particular harm sustained was
reasonably foreseeable at the time of the
defendants misconduct, his act or omission is
the legal cause thereof. Foreseeability is the
fundamental basis of the law of negligence. To
be negligent, the defendant must have acted
or failed to act in such a way that an ordinary
reasonable man would have realized that
certain interests of certain persons were
reasonably subjected to a general but definite
class of risks. [Jarencio]
UP LAW BOC TORTS CIVIL LAW
503
There are 2 types of proximate cause:
(1) Proximate cause immediately resulting in
injury: defined as that cause, which, in
natural and continuous sequence,
unbroken by any efficient intervening
cause, produces the injury, and without
which the result would not have occurred
[Bataclan v. Medina (1957)].
(2) Proximate cause not immediately resulting
in injury but sets in motion a chain of
events, also known as Proximate Legal
Cause: that acting first and producing the
injury, either immediately or by setting
other events in motion, all constituting a
natural and continuous chain of events,
each having a close causal connection with
its immediate predecessor, the final event
in the chain immediately effecting the
injury as a natural and probable result of
the cause which first acted, under such
circumstances that the person responsible
for the first event should, as an ordinary
prudent and intelligent person, have
reasonable ground to expect at the
moment of his act or default that an injury
to some person might probably result
therefrom.
Mercury Drug v. Baking (2007). Respondent
was mistakenly given Dormicum, a potent
sleeping tablet, instead of medication for his
blood sugar. He took a pill for 3 consecutive
days and on the third day, he fell asleep on the
wheel and figured in a vehicular accident. The
Court found that the proximate cause of the
accident was the Mercury Drug employees
mistake in reading the prescription.
Note: Here, 3 days have elapsed from the time
of the negligent act determined by the Court as
the proximate cause; thus, the Court did not
consider the time element in determining
proximate cause but the nature and gravity of
the injury.
Differentiated from:
(1) Concurrent Cause Several causes
producing the injury, and each is an
efficient cause without which the injury
would not have happened. The injury is
attributed to any or all the causes, and
recovery may be had against any or all of
those responsible.
Far Eastern Shipping v. CA (1998): As a
general rule, that negligence in order to
render a person liable need not be the sole
cause of an injury. It is sufficient that his
negligence, concurring with one or more
efficient causes other than the plaintiffs, is
the proximate cause of the injury. Where
the concurrent or successive negligent acts
or omissions of two or more persons,
although acting independently, are in
combination the direct and proximate
cause of a single injury to a third person, it
is impossible to determine in what
proportion each contributed to the injury
and either of them is responsible for the
whole injury. Where their concurring
negligence resulted in injury or damage to
a third party, they become joint tortfeasors
and are solidarily liable for the resulting
damage.
(2) Remote Cause a cause which would have
been a proximate cause, had there been no
efficient intervening cause after it and prior
to the injury.
Manila Electric v. Remonquillo (1956): A
prior and remote cause cannot be made
the basis of an action if such remote cause
did nothing more than furnish the
condition or give rise to the occasion by
which the injury was made possible, if
there intervened between such prior or
remote cause and the injury a distinct,
successive, unrelated, and efficient cause
of the injury, even though such injury
UP LAW BOC TORTS CIVIL LAW
504
would not have happened but for such
condition or occasion.
(3) Intervening Cause
The test of determining whether or not the
intervening cause is sufficient to absolve a
prior cause of the injury is as follows:
whether the intervention of a later cause is
a significant part of the risk involved in the
defendants conduct, or is so reasonable
connected with it that the responsibility
should not be terminated. In the
affirmative, such foreseeable intervening
forces are within the scope of the original
risk, and hence of the defendants
negligence. In the negative, there exists an
efficient intervening cause that relieves the
defendant of liability.
Phoenix Construction v. IAC (1987): If the
intervening cause is one which in ordinary
human experience is reasonably to be
anticipated, or one which the defendant
has reason to anticipate under the
particular circumstances, the defendant
may be negligent, among other reasons,
because of failure to guard against it.
There is an intervening cause combining
with the defendants conduct to produce
the result, and the defendants negligence
consists in failure to protect the plaintiff
against that very risk.
Tests to Determine Proximate Cause
(1) But for / Sine qua non rule
Whether such negligent conduct is a cause
without which the injury would not have
occurred or is the efficient cause which set
in motion the chain of circumstances
leading to the injury. [Bataclan v. Medina,
supra]
(2) Sufficient link
The Supreme Court has adopted a
relaxation of the but for test in Dy Teban
v. Jose Ching (2008). Plaintiff, however,
must establish a sufficient link between the
act or omission and the damage or injury.
That link must not be remote or farfetched; otherwise, no liability will attach.
The damage or injury must be a natural
and probable result of the act or omission.
(3) Substantial factor
If the actors conduct is a substantial factor
in bringing about harm to another, the fact
that the actor neither foresees nor should
have foreseen the harm or the manner in
which it occurred, does not prevent him
from being liable. [Philippine Rabit v. IAC
(1990)]
(4) Mixed considerations
There is no exact formula to determine
probable cause. It is based upon mixed
considerations of logic, common sense,
policy and precedent [Dy Teban v. Jose
Ching, supra].
(5) Cause v. condition
Phoenix Construction v. IAC (1987): The
distinction between cause and condition
has already been almost entirely
discredited. So far as it has any validity at
all, it must refer to the type of case where
the forces set in operation by the
defendant have come to rest in a position
of apparent safety, and some new force
intervense. But even in such cases, it is not
the distinction between cause and
condition which is important, but the
nature of the risk and the character of the
intervening cause.
(6) Last clear chance
The Doctrine of Last Clear Chance
Also known as: "doctrine of discovered
peril or doctrine of supervening
negligence or humanitarian doctrine.
UP LAW BOC TORTS CIVIL LAW
505
The antecedent negligence of the plaintiff
does not preclude him from recovering
damages caused by the supervening
negligence of the defendant, who had the
last fair chance to prevent the impending
harm by the exercise of due diligence [PNR
v. Brunty (2006)].
Picart v. Smith (1918): If both parties are
found to be negligent; but, their
negligence are not contemporaneous, the
person who has the last fair chance to
avoid the impending harm and fails to do
so is chargeable with the consequences,
without reference to the prior negligence of
the other party.
Simply stated, it covers successive acts of
negligence:
Note:
If plaintiff is the proximate cause: no recovery
can be made.
If plaintiff is not the proximate cause:
Recovery can be made but such will be
mitigated.
If negligence of parties is equal in degree,
then each bears his own loss.
PNR v. Brunty (2006): The doctrine of last
clear chance finds no application in a case
where the proximate cause of the injury has
been established.
The doctrine is not applicable in the following
cases:
Consolidated Bank v. CA (2003): The doctrine
of last clear chance does not apply in a case of
culpa contractual, where neither the
contributory negligence of the plaintiff nor his
last clear chance to avoid the loss, would
exonerate the defendant from liability. Such
contributory negligence or last clear chance by
the plaintiff merely serves to reduce the
recovery of damages by the plaintiff but does
not exculpate the defendant from his breach of
contract.
Pantranco v. Baesa (1989): Last clear chance
applies only if the person who allegedly had
the last opportunity to avert the accident was
aware of the existence of peril or should, with
exercise of due care, have been aware of it. The
doctrine can never apply where the party
charged is required to act instantaneously, and
if the injury cannot be avoided by application of
all means at hand after the peril is or should
have been discovered.
Bustamante v. CA (1991): The doctrine of last
clear chance, as enunciated in Anuran v. Buno,
applies in a suit between the owners and
drivers of colliding vehicles. It does not arise
where a passenger demands responsibility
from the carrier to enforce its contractual
obligations. It will be inequitable to exempt the
negligent driver of the jeepney and its owners
on the ground that the other driver was
likewise guilty of negligence.
Primary negligence of the
defendant
Contributory negligence of
the
plaintiff

Subsequent negligence of the

defendant in failing to avoid the
injury to the plaintiff
UP LAW BOC TORTS CIVIL LAW
506
C. DEFENSES
C.1. DUE DILIGENCE TO PREVENT THE
DAMAGE UNDER ARTICLE 2180
Art. 2180. The
obligation imposed by
Article
2176 is demandable not
only for ones own acts
or omissions, but also
for those of persons for
whom one is
responsible.
xxx
(8) The responsibility
treated of in this article
shall cease when the
persons herein
mentioned prove that
they observed all the
diligence of a good
father of a family to
prevent
damage.

Ramos v. PEPSI (1967): The presumption of

negligence on the part of the master or
employer, either in the selection of
servant/employee or in the supervision, when
an injury is caused by the negligence of a
servant/employee may be rebutted if the
employer shows to the satisfaction of the court
that in the selection and supervision, he has
exercised the care and diligence of a good
father of a family
C.2. ACTS OF PUBLIC OFFICERS
Vinzons-Chato v. Fortune (2008): When what
is involved is a duty owing to the public in
general, an individual cannot have a cause of
action the public officer although he may have
been injured by the action or inaction of the
officer, except when the individual suffers a
particular or special injury.
C.3. AUTHORITY OF LAW
Art. 5. Acts executed
against the provisions
of mandatory or
prohibitory laws shall be
void, except when the
law itself authorizes
their validity.

RPC, Art. 11. The

following do not incur
any
criminal liability:
(5) Any person who acts
in the fulfillment of a
duty or in the lawful
exercise of a right or
office
(8) Any person who acts
in obedience to an
order issued by a
superior for some lawful
purpose

C.4. DAMNUM ABSQUE INJURIA

There can be damage without injury in those
instances in which the loss or harm was not the
result of a violation of a legal duty.
Custodio v. CA (1996): Right to recover
damages does not arise from the mere fact
that the plaintiff suffered losses. To warrant
the recovery of damages, there must be both a
right of action for a legal wrong inflicted by the
defendant, and damage resulting to the
plaintiff therefrom. Wrong without damage, or
damage without wrong, does not constitute a
cause of action, since damages are merely part
of the remedy allowed for the injury caused by
a breach or wrong.
Injury Damage Damages
Recompense
Loss, hurt,
Illegal invasion or
harm resulting
of a legal right compensation
from the injury
awarded

Amonoy v. Gutierrez (2001): One who made

use of his own legal right does no injury, thus,
whatever damages are caused to another
should be borne solely by him under the
principle of damnum absque injuria. This
principle, however, does not apply when there
is an abuse in the exercise of a persons right.
UP LAW BOC TORTS CIVIL LAW
507
C.5. PLAINTIFFS NEGLIGENCE IS THE
PROXIMATE CAUSE
Art. 2179. When the
plaintiffs own
negligence was the
proximate cause of his
injury, he cannot recover
damages. xxx

This defense of plaintiffs negligence as

proximate cause is absolute, for it bars
recovery on the part of the plaintiff. In Manila
Electric v. Remoquillo (1956), the Court did not
allow recovery by Magno, ruling that his death
was primarily caused by his own negligence
and in some measure by the too close
proximity of the media agua to the electric
wire.
Bernardo v. Legaspi (1914): If the plaintiff in a
negligence action, by his own carelessness
contributed to the principal occurrence, that is,
to the accident, as one of the determining
causes thereof, he cannot recover.
C.6. CONTRIBUTORY NEGLIGENCE OF
THE PLAINTIFF
Art. 2179. xxx But if his
negligence was only
contributory, the
immediate and
proximate
cause of the injury being
the defendant's lack
of due care, the plaintiff
may recover
damages, but the courts
shall mitigate the
damages to be awarded.

Art. 2214. In quasi-

delicts, the contributory
negligence of the
plaintiff shall reduce the
damages that he may
recover.

Contributory negligence is defined as conduct

on the part of the injured party, which
contributed as a legal cause to the harm he
has suffered, which falls below the standard to
which he is required to conform for his own
protection [Valenzuela v. CA (1996)].
MH Rakes v. Atlantic (1907): Contributory
negligence does not defeat an action if it can
be shown that the defendant might, by the
exercise of reasonable care and prudence, have
avoided the consequences of the injured
party's negligence. Where the plaintiff
contributes to the principal occurrence as one
of its determining factors, he cannot recover.
Where, in conjunction with the occurrence, he
contributes only to his own injury, he may
recover the amount that the defendant
responsible for the event should pay for such
injury, less a sum deemed a suitable equivalent
for his own imprudence.
Genobiagon v. CA (1989): The defense of
contributory negligence does not apply in
criminal cases committed through reckless
imprudence, since one cannot allege the
negligence of another to evade the effects of
his own negligence.
C.7. FORTUITOUS EVENT
Art. 1174. Except in
cases expressly
specified
by the law, or when it is
otherwise declared
by stipulation, or when
the nature of the
obligation requires the
assumption of risk, no
person shall be
responsible for those
events
which, could not be
foreseen, or which,
though foreseen, were
inevitable.

Elements of caso fortuito [Juntilla v. Fontanar

(1985)]:
(a) The cause of the unforeseen and
unexpected occurrence, or of the failure of
the debtor to comply with his obligation,
must be independent of the human will;
(b) It must be impossible to foresee the event
or if it can be foreseen, it must be
impossible to avoid;
(c) The occurrence must be such as to render
it impossible for the debtor to fulfill his
obligation in a normal manner; and
(d) The obligor must be free from any
UP LAW BOC TORTS CIVIL LAW
508
participation in the aggravation of the
injury resulting to the creditor.
Hernandez v. COA (1984): The robbery that
happened to him cannot be said to be the
result of his imprudence and negligence,
having occurred in a public utility. This was
undoubtedly a fortuitous event covered by the
said provisions, something that could not have
been reasonably foreseen although it could
have happened.
C.8. PLAINTIFFS ASSUMPTION OF RISK
/ VOLENTI NON FIT INJURIA
The doctrine of volenti non fit injuria (that to
which a person assents is not presumed in law
as injury) refers to self-inflicted injury or to the
consent to injury which precludes the recovery
of damages by one who has knowingly and
voluntarily exposed himself to danger, even if
he is not negligent in doing so. This is so
because, in theory, the plaintiffs acceptance of
the risk has wiped out the defendants duty,
and as to the plaintiff the defendants
negligence is not a legal wrong.
Requisites:
(a) That the plaintiff had actual knowledge of
the danger;
(b) That he understood and appreciated the
risk from the danger; and
(c) That he voluntarily exposed himself to
such risk
The defense is not applicable in the following
cases:
Ilocos Norte v. CA (1989): A person is excused
from the force of the rule (volenti non fit
injuria), that when he voluntarily assents to a
known danger he must abide by the
consequences, if an emergency is found to
exist or if the life or property of another is in
peril or when he seeks to rescue his
endangered property.
Nikko Hotel v. Roberto Reyes (2005): The
doctrine does not find application to the case
because even if respondent Reyes assumed the
risk of being asked to leave the pary,
petitioners, under Articles 19 and 21 of the Civil
Code, were still under the obligation to treat
him fairly in order not to expose him to
unnecessary ridicule and shame.
C.9. PRESCRIPTION
Art. 1146. The following
actions must be
instituted within four
years:
(1) Upon an injury to the
rights of the
plaintiff;
(2) Upon a quasi-delict;
However, when the
action arises from or out
of any act, activity, or
conduct of any public
officer involving the
exercise of powers or
authority arising from
Martial Law including
the arrest, detention
and/or trial of the
plaintiff, the same must
be brought within
one (1) year.

Art. 1150. The time for

prescription for all
kinds of actions, when
there is no special
provision which ordains
otherwise, shall be
counted from the day
they may be brought.

Prescription periods:
4 years for QD
1 year for defamation
Kramer v. CA (1989): It is clear that the
prescriptive period must be counted when the
last element occurs or takes place, the time of
the commission of an act or omission violative
of the right of the plaintiff, which is the time
when the cause of action arises. Thus, the
prescription period begins from the day the
quasi-delict is committed.
C.10. WAIVER
Art. 6. Rights may be
waived, unless the
waiver is contrary to
law, public order, public

UP LAW BOC TORTS CIVIL LAW

509
policy, morals, or good
customs or prejudicial
to a third person with a
right recognized by
law.

Art. 1171. Responsibility

arising from fraud is
demandable in all
obligations. Any waiver
of
an action for future
fraud is void.

C.11. EMERGENCY RULE OR SUDDEN

PERIL DOCTRINE
Valenzuela v. CA (1996): An individual, who
suddenly finds himself in a situation of danger
and is required to act without much time to
consider the best means that may be adopted
to avoid the impending danger, is not guilty of
negligence if he fails to undertake what
subsequently and upon reflection may appear
to be a better solution, unless the emergency
was brought by his own negligence.
III. INTENTIONAL
TORTS
Manresa: Liability for personal acts or
omission is founded on that indisputable
principle of justice recognized by all legislators
that when a person by his act or omission
causes damage or prejudice to another, a
juridical relation is created by virtue of which
the injured person acquires a right to be
indemnified and the person causing the
damage is charged with the corresponding
duty of repairing the damage. The reason for
this is found in the obvious truth that man
should subordinate his acts to the precepts of
prudence and if he fails to observe them and
cause damage to another, he must repair the
damage.
A. HUMAN RELATIONS TORTS
A.1. ABUSE OF RIGHT
Art. 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.

Generally, the exercise of any right must be in

accordance with the purpose for which it was
established. It must not be excessive or unduly
harsh; there must be no intention to injure
another.
There is abuse of right when:
(1) The right is exercised for the only purpose
of prejudicing or injuring another
(2) The objective of the act is illegitimate
(3) There is an absence of good faith
Elements [Albenson v. CA (1993)]:
(a) There is a legal right or duty;
(b) Which is exercised in bad faith;
(c) For the sole intent of prejudicing or injuring
another.
Case Legal Right and Injury Doctrine
The standards in NCC 19
Velayo v. Shell (1959) Right to transfer credit. are
implemented by NCC 21.
The transfer of credit
from Shell
Philippines to Shell USA
was deemed a
violation of NCC 21 as it
allowed Shell to
attach properties of their
creditor CALI to
the prejudice of its other
creditors.
When a right is exercised
Right to dismiss an in a
Globe v. CA (1989)
employee. manner which does not
conform
The dismissal itself was
not illegal but it

UP LAW BOC TORTS CIVIL LAW

510
was the manner of
dismissal which was with the norms in NCC 19, and
deemed in violation of results in damage to another, a
Article 19, as such legal wrong is thereby committed.
was based on unfounded The law, therefore, recognizes a
accusations of primordial limitation on all rights.
dishonesty.
The conscious
indifference of a
person to the rights or
welfare of the
University of the East
Academic freedom. others who may be
v. Jader (2000)
affected by his
act or omission can
support a claim
for damages.
The conscious
indifference of the school
in
not informing its student
that he could not
graduate formed the
basis for the award of
damages.
Amonoy v. Gutierrez Right to demolish The principle of damnum
(2001) anothers house on his absque
own property. injuria does not apply
when the
exercise of the legal right
 is
suspended or
extinguished pursuant
to a court order. The
exercise of a
right ends when the right
disappears, and it
disappears when
it is abused, especially to
the
prejudice of others.
Amonoy obtained a
judgment in his favor
for Gutierrez to vacate. A
demolition order
was issued but the court
suspended it with
a TRO. Amonoy
proceeded with the
demolition. In a complaint
for damages,
he claims the principle of
damnum absque
injuria.
Article 19, known to
contain what is
commonly referred to as
the
principle of abuse of
rights, is not a
panacea for all human
hurts and
Nikko Hotel Manila Right to forbid uninvited
social grievances. The
Garden v. Reyes guests from
object of this
(2005) entering the party.
article is to set certain
standards
which must be observed
not only in
the exercise of ones
rights but also
in the performance of
ones duties.
Ruby Lims throwing out
of complainant
Reyes, as a gatecrasher
in a private party,
was merely in exercise of
her duties as
Executive Secretary of
the hotel where the
party was held, and did
not constitute a
violation of Article 19.

A.2. ACTS CONTRARY TO LAW

Art. 20. Every person
who, contrary to law,
willfully or negligently
causes damage to
another, shall indemnify
the latter for the
same.

The provision is intended to provide a remedy

in cases where the law declares an act illegal
but fails to provide for a relief to the party
injured. [Jarencio]
NCC 20 does not distinguish, and the act may
be done willfully or negligently.
Requisites
(a) The act must be willful or negligent;
(b) It must be contrary to law; and
(c) Damages must be suffered by the injured
party.
Garcia v. Salvador (2007). Salvador was
misdiagnosed with Hepatitis, as a result of
which she lost her job. During trial, it was
proven that the clinic was operating under
substandard conditions, in violation of the
Clinical Laboratory Law, DOH Administrative
UP LAW BOC TORTS CIVIL LAW
511
Order No. 49-B, and the Philippine Medical
Technology Act of 1969. The Court held that
violation of a statutory duty is negligence, and
that Article 20 provides the legal basis for
award of damages to a party who suffers
damage whenever one commits an act in
violation of some legal provision.
A.3. ACTS CONTRARY TO MORALS
Art. 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.
This article is designed to expand the concept
of torts and quasi-delict in this jurisdiction by
granting adequate legal remedy for the untold
number of moral wrongs which is impossible
for human foresight to specifically enumerate
and punish in statute books. [Baksh v. CA
(1993)]
Elements: [Albenson v. CA (1993)]
(a) There is an act which is legal;
(b) But which is contrary to morals, good
customs, and public policy; and
(c) It is done with intent to injure.
Examples of acts contrary to morals:
(1) Breach of Promise to Marry and Moral
Seduction
Wassmer v. Velez (1964): Mere breach of
promise to marry is not an actionable
wrong. But to formally set a wedding and
go through all the above-described
preparation and publicity, only to walk out
of it when the matrimony is about to be
solemnized, is quite different. This is
palpably and unjustifiably contrary to good
customs xxx.
Baksh v. CA (1993): Where a man's promise
to marry is in fact the proximate cause of
the acceptance of his love by a woman and
his representation to fulfill that promise
thereafter becomes the proximate cause of
the giving of herself unto him in a sexual
congress, proof that he had, in reality, no
intention of marrying her and that the
promise was only a subtle scheme or
deceptive device to entice or inveigle her to
accept him and to obtain her consent to
the sexual act, could justify the award of
damages pursuant to Article 21 not
because of such promise to marry but
because of the fraud and deceit behind it
and the willful injury to her honor and
reputation. It is essential, however, that
such injury should have been committed in
a manner contrary to morals, good
customs or public policy.
Tanjanco v. CA (1966): However, when for
one whole year, the plaintiff, a woman of
legal age, maintained sexual relations with
the defendant, with repeated acts of
intercourse, there is here voluntariness. No
case under Article 21 is made.
(2) Malicious Prosecution
Malicious prosecution is the institution of
any action or proceeding, either civil or
criminal, maliciously and without probable
cause.
Elements: [Magbanua v. Junsay (2007)]
(a) The fact of the prosecution or that the
prosecution did occur and that the
defendant was himself the prosecutor
or that he instigated its
commencement;
(b) That the action finally terminated with
an acquittal;
(c) That in bringing the action, the
prosecutor acted without probable
cause
UP LAW BOC TORTS CIVIL LAW
512
(d) That the prosecutor was actuated or
impelled by legal malice, that is, by
improper or sinister motive.
Que v. IAC (1989): The mere dismissal of
the criminal complaint by the fiscals office
did not create a cause of action for
malicious prosecution, because the
proceedings therein did not involve an
exhaustive examination of the elements of
malicious prosecution. To constitute such,
there must be proof that the prosecution
was prompted by a sinister design to vex
and humiliate a person and that it was
initiated deliberately by the defendant
knowing that his charges were false and
groundless.
Magbanua v. Junsay (2007): Malicious
prosecution involves not only criminal but
civil and administrative suits as well.
(3) Public Humiliation
Pe v. Pe (1962): Lolitas family filed a case
against Alfonse Pe, a married man, for
allegedly seducing Lolita and causing
great damage to the name of her parents,
brothers, and sisters. The Court sustained
the claim, finding an injury to Lolitas
family in a manner contrary to morals,
good customs and public policy as
contemplated in Article 21 of the new Civil
Code.
Grand Union v. Espino (1979): It is against
morals, good customs and public policy to
humiliate, embarrass and degrade the
dignity of a person. Everyone must respect
the dignity, personality, privacy and peace
of mind of his neighbors and other persons
(Article 26, Civil Code).
(4) Oppressive Dismissal
Quisaba v. Sta. Ines (1974): The right of an
employer to dismiss an employee is not to
be confused with the manner in which this
right is to be exercised and the effects
flowing therefrom. If the dismissal was
done antisocially or oppressively, then
there is a violation of Article 1701, which
prohibits acts of oppression by either
capital or labor against the other, and
Article 21, which makes a person liable for
damages if he willfully causes loss or injury
to another in a manner that is contrary to
morals, good customs, or public policy.
When the manner in which the company
exercised its right to dismiss was abusive,
oppressive and malicious, it is liable for
damages.
A.4. UNJUST ENRICHMENT
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.

Art. 23. Even when an

act or event causing
damage to anothers
property was not due to
the fault or negligence
of the defendant, the
latter shall be liable for
indemnity if through
the act or event he was
benefited.
Art. 2142. Certain
lawful, voluntary and
unilateral acts give rise
to the juridical
relation of quasi-contract
to the end that no
one shall be unjustly
enriched or benefited at
the expense of another.

Art. 2143. The

provisions for quasi
contracts
in this Chapter do not
exclude other quasi
contracts which may
come within the purview
of the preceding article.

One person should not be permitted to

unjustly enrich himself at the expense of
another, but should be required to make
restitution of, or for property or benefits
received, retained, or appropriated where it is
just and equitable that such restitution be
UP LAW BOC TORTS CIVIL LAW
513
made, and where such action involves no
violation or frustration of law or opposition to
public policy, either directly or indirectly.
Enrichment at the expense of another is not
per se forbidden. It is such enrichment without
just or legal cause that is contemplated here.
Just and legal cause is always presumed, and
the plaintiff has the burden of proving its
absence.
The restitution must cover the loss suffered by
the plaintiff but it can never exceed the
amount of unjust enrichment of the defendant
if it is less than the loss of the plaintiff.
Requisites:
(a) That the defendant has been enriched;
(b) That the plaintiff has suffered a loss;
(c) That the enrichment of the defendant is
without just or legal ground; and
(d) That the plaintiff has no other action based
on contract, crime or quasi-delict.
A.5. VIOLATION OF HUMAN DIGNITY
Art. 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 of
another;
(3) Intriguing to cause
another to be
alienated from his
friends;
(4) Vexing or humiliating
another on account
of his religious beliefs,
lowly station in
life, place of birth,
physical defect, or
other personal condition.

MVRS Publications v. Islamic Da'wah Council

(2003): Article 26 specifically applies to
intentional acts which fall short of being
criminal offenses. It itself expressly refers to
tortious conduct which "may not constitute
criminal offenses." The purpose is precisely to
fill a gap or lacuna in the law where a person
who suffers injury because of a wrongful act
not constituting a crime is left without any
redress. Under Article 26, the person
responsible for such act becomes liable for
"damages, prevention and other relief." In
short, to preserve peace and harmony in the
family and in the community, Article 26 seeks
to eliminate cases of damnum absque injuria
in human relations.
The principal rights protected under this
provision are the following:
(1) The right to personal dignity
(2) The right to personal security
(3) The right to family relations
(4) The right to social intercourse
(5) The right to privacy
(6) The right to peace of mind
Note: Coverage of Art. 26 is not limited to
those enumerated therein, the enumeration
being merely examples of acts violative of a
persons rights to dignity, personality, privacy
and peace of mind. Other similar acts are
also covered within the scope of the article.
VIOLATION OF PERSONAL DIGNITY
In order to be actionable it is not necessary
that the act constitutes a criminal offense. The
remedy afforded by the law is not only the
recovery of damages. Prevention and other
relief is also available. In other words,
injunction and other appropriate reliefs may
also be obtained by the aggrieved party.
VIOLATION OF PRIVACY
Privacy is the right to be let alone, or to be free
from unwarranted publicity, or to live without
unwarranted interference by the public in
UP LAW BOC TORTS CIVIL LAW
514
matters in which the public is not necessarily
concerned. This right is purely personal in
nature, such that it can be invoked only by the
person actually injured, it is subject to a proper
waiver, and it ceases upon death. However, the
privilege may be given to heirs of a deceased to
protect his memory, to protect the feelings of
the living heirs.
Reasonableness of Expectation of Privacy Test:
[Ople v. Torres (1998)]
(1) Whether by ones conduct, the individual
has exhibited an expectation of privacy
(2) Whether this expectation is one that
society recognizes and accepts as
reasonable
The general rule is that the right to privacy may
only be invoked by natural persons. Juridical
persons cannot invoke this because the basis
to this right is an injury to the feelings and
sensibilities of the injured party, and a
corporation has none of those. The exception is
where the right to privacy is invoked along with
the right against unreasonable searches and
seizures. An individuals right to privacy under
Article 26(1) of the Civil Code should not be
confined to his house or residence as it may
extend to places where he has the right to
exclude the public or deny them access [Sps.
Hing v. Choachuy (2013)].
Types of invasion of privacy
(1) Publication of embarrassing private facts
The interest here is the right to be free
from unwarranted publicity, wrongful
publicizing of private affairs and activities,
as these are outside the ambit of
legitimate public concern.
Ayer v. Capulong (1988): Public figures
enjoy a limited right to privacy as
compared to ordinary individuals.
(2) Intrusion upon plaintiffs private affairs
This is not limited to situations where the
wrongdoer physically trespasses into
ones property.
Generally, there is no invasion of privacy
when journalists report something that
occurs in the public realm, except when
the acts of the journalist are to an extent
that it constitutes harassment.
RA 4200: It is illegal for any person not
authorized by both parties to any private
communication to secretly record such
communication.
(3) Publicity which puts one in a false light in
the public eye The interest here is in not
being made or forced to appear before the
public in an objectionable false light or
position.
Tort of putting in false
Defamation
light
The embarrassment of
Concerns the
a person being
reputational harm to a
portrayed as
person
something he is not
Publication is satisfied
Statement should be
even if communicated
actually made in
to only one specific
public
third person

(4) Commercial appropriation of likeness of

image It consists of appropriation, for the
defendants benefit or advantage (ex. used
in defendants advertisement), of the
plaintiffs name or likeness (picture or
portrait).
DISTURBANCE OF PEACE OF MIND
The disturbance of the mental and emotional
tranquility of the plaintiff by the defendant is a
legal injury in itself and, therefore, a sufficient
cause of action for damages, injunction, and
other relief. A person, however, cannot be held
liable for damages for the mental or emotional
disturbance of the plaintiff which was due to
UP LAW BOC TORTS CIVIL LAW
515
the latters susceptibility to such disturbance,
where the defendant had no knowledge of
such peculiar susceptibility. The tendency of
the law is to secure an interest in mental
comfort only to the extent of the ordinary
sensibilities of men.
Interference with Relations
An interference with the continuance of
unimpaired interests founded upon the
relation in which the plaintiff stands toward
one or more third persons [Prosser and
Keeton].
KINDS:
(1) Family relations
(2) Social relations
(3) Economic relations
(4) Political relations
Family Relations
ALIENATION OF AFFECTION
This is a cause of action in favor of a
husband against one who wrongfully
alienates the affection of his wife,
depriving him of his conjugal rights to her
consortium, that is, her society, affection,
and assistance.
Elements:
(a) Wrongful conduct of the defendant:
intentional and malicious enticing of a
spouse away from the other spouse
(b) Loss of affection or consortium
Note: Complete absence of affection
between the spouses is not a defense.
(c) Causal connection between such
conduct and loss
Tenchavez v. Escao (1965): There is no
evidence that the parents of Vicenta, out of
improper motives, aided and abetted her
original suit for annulment, or her
subsequent divorce; she appears to have
acted independently, and being of age, she
was entitled to judge what was best for her
and ask that her decisions be respected.
Her parents, in so doing, certainly cannot
be charged with alienation of affections in
the absence of malice or unworthy motives,
which have not been shown, good faith
being always presumed until the contrary
is proved.
Liability of Parents, Guardians or Kin
The law distinguishes between the right of
a parent to interest himself in the marital
affairs of his child and the absence of
rights in a stranger to intermeddle in such
affairs. However, such distinction between
the liability of parents and that of
strangers is only in regard to what will
justify interference. A parent is liable for
alienation of affections resulting from his
own malicious conduct, as where he
wrongfully entices his son or daughter to
leave his or her spouse, but he is not liable
unless he acts maliciously, without
justification and from unworthy motives.
He is not liable where he acts and advises
his child in good faith with respect to his
child's marital relations in the interest of
his child as he sees it, the marriage of his
child not terminating his right and liberty
to interest himself in, and be extremely
solicitous for, his child's welfare and
happiness even where his conduct and
advice suggest or result in the separation
of the spouses or the obtaining of a divorce
or annulment, or where he acts under
mistake or misinformation, or where his
advice or interference are indiscreet or
unfortunate, although it has been held that
the parent is liable for consequences
resulting from recklessness. He may in
good faith take his child into his home and
afford him or her protection and support,
so long as he has not maliciously enticed
his child away, or does not maliciously
entice or cause him or her to stay away,
UP LAW BOC TORTS CIVIL LAW
516
from his or her spouse. This rule has more
frequently been applied in the case of
advice given to a married daughter, but it
is equally applicable in the case of advice
given to a son.
LOSS OF CONSORTIUM
Lilius v. Manila Railroad Company (1934):
The plaintiff Aleko E. Lilius also seeks to
recover the sum of P2,500 for the loss of
what is called Anglo-Saxon common law
"consortium" of his wife, that is, "her
services, society and conjugal
companionship", as a result of personal
injuries which she had received from the
accident now under consideration.
Inasmuch as a wife's domestic assistance
and conjugal companionship are purely
personal and voluntary acts which neither
of the spouses may be compelled to
render, it is necessary for the party
claiming indemnity for the loss of such
services to prove that the person obliged to
render them had done so before he was
injured and that he would be willing to
continue rendering them had he not been
prevented from so doing.
CRIMINAL CONVERSATION (ADULTERY)
Interference with the marital relations by
committing adultery with one of the
spouses. This is obvious enough in the case
of rape but also applies where the
adulterous spouse consented to or initiated
the intercourse. [Prosser and Keeton, p. 917]
Social Relations
(1) Meddling with or disturbing family relations
Art. 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;

xxx
2) Meddling with or
disturbing the private
life
or family relations of
another;

Developed as an offshoot of the action for

enticing away a servant and depriving the
master of the proprietary interest in [the
servants] services until there has been a
gradual shift of emphasis away from
services and toward a recognition of
more intangible elements in the domestic
relations, such as companionship and
affection. [Prosser and Keeton, p. 916]
INTRIGUING TO CAUSE ANOTHER TO BE ALIENATED
FROM HIS FRIENDS
A person who committed affirmative acts
intended to alienate the existing friendship
of one with his friends is liable for
damages. A man is a social being and for
being so, he needs friends to socialize with
and to depend upon in case of need. To
alienate him wrongfully or with malice
from his friends is to cause him suffering
for which he is entitled to damages.
Economic Relations
Art. 1314. Any person
who induces another to
violate his contract with
another person shall
be liable for damages to
the other
contracting party.

Prosser and Keeton: Tort liability may be

imposed upon a defendant who intentionally
and improperly interferes with the plaintiffs
rights under a contract with another person if
the interference causes the plaintiff to lose a
right under the contract or makes the contract
rights more costly or less valuable. This law of
interference of contract is part of a larger body
of tort law aimed at protection of relationships.
Elements of tort interference: [So Ping Bun v.
CA (1999)]
UP LAW BOC TORTS CIVIL LAW
517
(a) Existence of a valid contract
(b) Knowledge on the part of the third person
of the existence of contract; and
(c) Interference of the third person is without
legal justification or excuse.
Gilchrist v. Cuddy (1915): Everyone has a right
to enjoy the fruits and advantages of his own
enterprise, industry, skill and credit. He has no
right to be protected against competition; but
he has a right to be free from malicious and
wanton interference, disturbance or
annoyance. If disturbance or loss comes as a
result of competition, or the exercise of like
rights by others, it is damnum absque injuria,
unless some superior right by contract or
otherwise is interfered with. Thus, a plaintiff
loses his cause of action if the defendant
provides a sufficient justification for such
interference, which must be an equal or
superior right in themselves. The defendant
may not legally excuse himself on the ground
that he acted on a wrong understanding of his
own rights, or without malice, or bona fide, or
in the best interests of himself.
So Ping Bun v. CA (1999): Bad faith/Malice is
required to make the defendant liable for
damages in cases of tortuous interference.
A.6 DERELICTION OF DUTY
Art. 27. Any person
suffering material or
moral loss because a
public servant or
employee refuses or
neglects, without just
cause, to perform his
official duty may file an
action for damages and
other relief against
the latter, without
prejudice to any
disciplinary
administrative action
that may
be taken.

This applies only to acts of nonfeasance or the

nonperformance of some acts which a person
is obliged or has responsibility to perform. The
duty of the public servant must be ministerial
in character. If the duty is discretionary, he is
not liable unless he acted in a notoriously
arbitrary manner.
The defense of good faith is not available
because an officer is under constant obligation
to discharge the duties of his office, and it is
not necessary to show that his failure to act
was due to malice or willfulness.
Requisites: [Amaro v. Sumanguit (1962)]
(a) Defendant is a public officer charged with
a performance of a duty in favor of the
plaintiff;
(b) He refused or neglected without just cause
to perform the duty;
(c) Plaintiff sustained material or moral loss
as a consequence of such nonperformance;
(d) The amount of such damages, if material.
A.7. UNFAIR COMPETITION
Art. 28. Unfair
competition in
agricultural,
commercial or industrial
enterprises or in
labor through the use of
force, intimidation,
deceit, machination or
any other unjust,
oppressive or
highhanded method
shall give
rise to a right of action
by the person who
thereby suffers damage.

B. INDEPENDENT CIVIL ACTIONS

Rule 111, Sec. 3, ROC.
In the cases provided
for in Articles 32, 33, 34
and 2176 of the Civil
Code of the Philippines,
the independent civil
action may be brought
by the offended party.
It shall proceed
independently of the
criminal
action and shall require
only a
preponderance of
evidence. In no case,
however, may the
offended party recover
damages twice for the
same act or omission
charged in the criminal
action.

B.1. VIOLATION OF CIVIL AND POLITICAL

RIGHTS
UP LAW BOC TORTS CIVIL LAW
518
Art. 32. Any public
officer or employee, or
any
private individual, who
directly or indirectly
obstructs, defeats,
violates or in any
manner
impedes or impairs any
of the following
rights and liberties of
another person shall
be liable to the latter for
damages:
(1) Freedom of religion
(2) Freedom of speech
(3) Freedom to write for
the press or to
maintain a periodical
publication
(4) Freedom from
arbitrary or illegal
detention
(5) Freedom of suffrage
(6) The right against
deprivation of property
without due process of
law
(7) The right to just
compensation when
property is taken for
public use
(8) The right to equal
protection of the laws
(9) The right to be
secure in ones person,
house, papers and
effects against
unreasonable searches
and seizures
(10)The liberty of abode
and of changing the
same
(11) The right to privacy
of communication
and correspondence
(12) The right to become
a member of
associations and
societies for purposes
not contrary to law
(13) The right to take
part in a peaceable
assembly and petition
the government
for redress of grievances
(14) The right to be free
from involuntary
servitude in any form
(15) The right of the
accused against
excessive bail
(16) The right of the
accused to be heard by
himself and counsel, to
be informed of
the nature and the
cause of the
accusation against him,
to have a speedy
and public trial, to meet
the witnesses
face to face, to have
compulsory process
to secure the attendance
of witnesses on
is behalf;
(17) Freedom from being
compelled to be a
witness against ones
self, or from being

forced to confess his

guilt, or from being
induced by a promise of
immunity or
reward to make such
confession, except
when the person
confessing becomes a
State witness.
(18) Freedom from
excessive fines, or cruel
and unusual
punishment, unless the
same is imposed or
inflicted in
accordance with a
statute which has not
been judicially declared
unconstitutional;
(19) Freedom of access
to the courts
In any of the cases
referred to in this article,
whether or not the
defendants act or
omission constitutes a
criminal offense, the
aggrieved party has a
right to commence an
entirely separate and
distinct civil action for
damages, and for other
relief. Such civil
action shall proceed
independently of any
criminal prosecution (if
the latter be
instituted) and may be
proved by a
preponderance of
evidence.
The indemnity shall
include moral damages.
Exemplary damages
may also be
adjudicated.
The responsibility herein
set forth is not
demandable from a
judge unless his act or
omission constitutes a
violation of the Penal
code or any other penal
statute.

Article 32 speaks of a particular specie of an

act that may give rise to an action for
damages against a public officer, and that is, a
tort for impairment of rights and liberties.
[Vinzons-Chato v. Fortune (2007)]
Article 32 is clear that not only public officers
but also private individuals can incur civil
liability for violation of rights enumerated
therein. Because the provision speaks of an
officer, employee or person directly or
indirectly responsible for the violation of the
constitutional rights and liberties of another, it
UP LAW BOC TORTS CIVIL LAW
519
is not the actor alone who must answer for
damages under Article 32. It is not even
necessary that the defendant should have
acted with malice or bad faith, otherwise, it
would defeat its main purpose, which is the
effective protection of individual rights. [Silahis
v. Soluta (2006)]
Aberca, et al. v. Ver, et al. (1988): It is obvious
that the purpose of the above codal provision
(Art. 32) is to provide a sanction to the deeply
cherished rights and freedoms enshrined in the
Constitution. Its message is clear; no man may
seek to violate those sacred rights with
impunity. In times of great upheaval or of
social and political stress, when the temptation
is strongest to yield borrowing the words of
Chief Justice Claudio Teehankee to the law
of force rather than the force of law, it is
necessary to remind ourselves that certain
basic rights and liberties are immutable and
cannot be sacrificed to the transient needs or
imperious demands of the ruling power. The
rule of law must prevail, or else liberty will
perish.
B.2. DEFAMATION, FRAUD, PHYSICAL
INJURIES
Art. 33. In cases of
defamation, fraud, and
physical injuries, a civil
action for damages,
entirely separate and
distinct from the
criminal action, may be
brought by the
injured party. Such civil
action shall proceed
independently of the
criminal prosecution,
and shall require only a
preponderance of
evidence.
Madeja v. Caro (1983): The civil action for
damages that Article 33 allows to be instituted
is ex-delicto. This is manifest from the
provision which uses the expressions criminal
action and criminal prosecution. Quoting
Tolentino, the Court ruled that this provision is
an exception to the general rule that the civil
action for recovery of civil liability arising from
the offense charged is impliedly instituted with
the criminal action. Where the offense is
defamation, fraud, or physical injuries, a civil
action may be filed independently of the
criminal action, even though no reservation is
made.
(1) Defamation the offense of injuring a
persons character, fame or reputation
through false or malicious statements.
Defamation is an invasion of a relational
interest since it involves the opinion which
others in the community may have, or tend
to have, of the plaintiff.
Elements of libel pursuant to RPC, Art. 353:
[Daez v. CA (1990)]
(a) An allegation or imputation of a
discreditable act or condition
concerning another
(b) Publication of the imputation
(c) Identity of the person defamed
(d) Existence of malice
MVRS Publications, Inc. v. Islamic (2003):
Where the defamation is alleged to have
been directed at a group or class, it is
essential that the statement must be so
sweeping or all-embracing as to apply to
every individual in that group or class, or
sufficiently specific so that each individual
in the class or group can prove that the
defamatory statement was specifically
pointed to him.
Yuchengco v. Manila Chronicle (2009): In
determining whether certain utterances
are defamatory, the words used are to be
construed in their entirety and taken in
their plain, natural and ordinary meaning,
as they would naturally be understood by
persons hearing or reading them, unless it
appears that they were used and
understood in another sense. When malice
UP LAW BOC TORTS CIVIL LAW
520
in fact is proven, assertions and proofs that
the libelous articles are qualifiedly
privileged communications are futile, since
being qualifiedly privileged
communications merely prevents the
presumption of malice from attaching in a
defamatory imputation.
(2) Fraud Estafa under RPC, 315; Article 33
does not cover violations of B.P. 22.
(3) Physical Injuries (Assault and Battery)
Battery
Battery is the actual infliction of any
unlawful or unauthorized violence on the
person of another, irrespective of its
degree. The law protects the interest of the
individual in freedom from bodily harm or
any impairment of the physical integrity of
the body.
Assault
Assault is an intentional, unlawful offer of
physical injury to another by force
unlawfully directed toward the person of
another, under such circumstances as to
create a well-founded fear of imminent
peril, coupled with the apparent present
ability to effectuate the attempt if not
prevented. The law seeks to protect the
interest of the individual in freedom from
offensive bodily touching although no
actual harm is done.
Carandang v. Santiago and Valenton
(1955): Defamation and fraud (in Art. 33)
are used in their ordinary sense because
there are no specific provisions in the
Revised Penal Code using these terms as
names of offenses defined therein, so that
these two terms defamation and fraud
must have been used not to impart to them
any technical meaning in the laws of the
Philippines, but in their generic sense. With
these apparent circumstances in mind, it is
evident that the term physical injuries
could not have been used in its specific
sense as a crime defined in the Revised
Penal Code, for it is difficult to believe that
the Code Commission would have used
terms in same articlesome in this general
and others in its technical sense. In other
words, the term physical injuries should
be understood to mean bodily injury, not
the crime of physical injuries, because the
terms used with the latter are general
terms.
Corpus v. Paje (1969): Paje was acquitted
of the charge of homicide and double
serious physical injuries through reckless
imprudence on the ground that the
collision was a pure accident and the
negligence charged against him did not
exist. In a separate civil action to enforce
civil liability filed by the heirs of the
deceased, the Court ruled that criminal
negligence is not one of the three crimes
mentioned in Article 33, which authorizes
the institution of an independent civil
action. Although in the case of Dyogi v.
Yatco, the Court held that the term
physical injuries includes homicide, it is
borne in mind that the charge against Paje
was for reckless imprudence resulting in
homicide, and the law penalizes the
negligent or careless act, not the result
thereof.
B.3. NEGLECT OF DUTY
Art. 34. When a
member of a city or
municipal police force
refuses or fails to
render aid or protection
to any person in case
of danger to life or
property, such peace
officer shall be primarily
liable for damages,
and the city or
municipality shall be
subsidiarily responsible
therefor. The civil
action herein recognized
shall be
independent of any
criminal proceedings,
and a preponderance of
evidence shall

UP LAW BOC TORTS CIVIL LAW

521
suffice to support such
action.

Art. 34 covers a situation where:

(1) There is danger to the life or property of a
person;
(2) A member of a city or municipal police
force who is present in the scene refused or
failed to render aid or protection to the
person; and
(3) Damages are caused whether to the
person and/or property of the victim.
Nature of liability
(1) Of the police officer Primary
(2) City or municipality Subsidiary
The defense of having observed the diligence
of a good father of a family to prevent the
damage is not available to the
city/municipality.
B.4. CATCH-ALL INDEPENDENT CIVIL
ACTION
Art. 35. When a person,
claiming to be
injured by a criminal
offense, charges
another with the same,
for which no
independent civil action
is granted in this
Code or any special law,
but the justice of the
peace finds no
reasonable grounds to
believe
that a crime has been
committed, or the
prosecuting attorney
refuses or fails to
institute criminal
proceedings, the
complaint
may bring a civil action
for damages against
the alleged offender.
Such civil action may
be supported by a
preponderance of
evidence. Upon the
defendant's motion, the
court may require the
plaintiff to file a bond
to indemnify the
defendant in case the
complaint should be
found to be malicious.
If during the pendency
of the civil action, an
information should be
presented by the
prosecuting attorney,
the civil action shall be
suspended until the
termination of the
criminal proceedings.

IV. LIABILITY
ATTACHED TO
SPECIFIC PERSONS
A. STRICT LIABILITY
A.1. POSSESSOR OR USER OF ANIMALS
Art. 2183. The
possessor of an animal
or
whoever may make use
of the same is
responsible for the
damage which it may
cause, although it may
escape or be lost. This
responsibility shall cease
only in case the
damage should come
from force majeure or
from the fault of the
person who has suffered
damage.

Since the law makes no distinction, this is

applicable to both wild (in case the wild animal
is kept) and domestic animals. It is enough
that defendant is the possessor, owner, or user
of the animal at the time it caused the damage
complained of, to hold him liable therefor.
Vestil v. IAC (1989): Possession of the animal,
not ownership, is determinative of liability
under Art. 2183. The obligation imposed by
said article is not based on the negligence or
on the presumed lack of vigilance of the
possessor or user of the animal causing
damage. It is based on natural equity and on
the principle of social interest that he who
possesses animals for his utility, pleasure, or
service, must answer for any damage which
such animal may cause. The contention that
the defendant could not be expected to
exercise remote control of the animal is not
acceptable. In fact, Art. 2183 holds the
possessor liable even if the animal should
escape or be lost and so be removed from his
control. It is likewise immaterial that the
animal was tame and was merely provoked by
the victim. The law does not speak only of
UP LAW BOC TORTS CIVIL LAW
522
vicious animals but covers even tame ones as
long as they cause injury.
Possible defenses against this liability
(1) Force Majeure
(2) Fault of person suffering damage
(3) Act of third persons
A.2. PROVINCES, CITIES, AND
MUNICIPALITIES
Art. 2189. Provinces,
cities and municipalities
shall be liable for
damages for the death
of,
or injuries suffered by,
any person by reason
of the defective
condition of roads,
streets,
bridges, public buildings,
and other public
works under their
control or supervision.

Guilatco v. Dagupan (1989): It is not even

necessary that the defective roads or streets
belong to the province, city or municipality for
liability to attach. The article only requires that
either control or supervision be exercised over
said street or road.
A.3. PROPRIETOR OF BUILDING OR
STRUCTURE
Art. 2190. The
proprietor of a building
or
structure is responsible
for the damages
resulting from its total or
partial collapse, if it
should be due to the
lack of necessary
repairs.

Art. 2191. Proprietors

shall also be
responsible for damages
caused:
(1) By the explosion of
machinery which has
not been taken care of
with due
diligence, and the
inflammation of
explosive substances
which have not
been kept in a safe and
adequate place;
(2) By excessive smoke,
which may be
harmful to persons or
property;
(3) By the falling of trees
situated at or near
highways or lanes, if not
caused by force
majeure;
(4) By emanations from
tubes, canals,

sewers or deposits of
infectious matter,
constructed without
precautions suitable
to the place.

Art. 2192. If damage

referred to in the two
preceding articles should
be the result of any
defect in the
construction mentioned
in
article 1723, the third
person suffering
damages may proceed
only against the
engineer or architect or
contractor in
accordance with said
article, within the
period therein fixed.

Ownership of a building imposes on the

proprietor thereof the duty to maintain it in
good condition at all times to the end that it
may not collapse either totally or partially as to
cause damage or injury to anothers person or
property. This duty obtains whether the
building is leased or held in usufruct.
Considering, however, that the lessee or
usufructuary has direct and immediate control
of the building, the law imposes on him the
duty to notify the proprietor of such urgent or
extraordinary repairs. And where the
proprietors failure to make the necessary
repairs was due to the failure of the lessee or
usufructuary to notify him, the proprietor is
entitled to indemnification for damages he
may have been required to pay to the parties.
Liability does not attach to the proprietor if the
damage was caused by any defect in the
construction mentioned in Article 1723, in
which case the action should be against the
engineer or architect.
Under Article 2190, the plaintiff is required to
prove:
(a) The total or partial collapse of a building or
structure
(b) That the defendant is the proprietor
(c) That the collapse was due to the lack of
necessary repairs
UP LAW BOC TORTS CIVIL LAW
523
Note: There is no requirement to prove
negligence.
Under Article 2191, with the exception of No. 1,
negligence is also not an issue.
Gotesco Investment Corp. v. Chatto (1992): The
owner or proprietor of a place of public
amusement impliedly warrants that the
premises, appliances and amusement devices
are safe for the purpose for which they are
designed, the doctrine being subject to no
other exception or qualification than that he
does not contract against unknown defects not
discoverable by ordinary or reasonable means.
A.4. ENGINEER OR ARCHITECT OF
COLLAPSED BUILDING
Art. 1723. The engineer
or architect who drew
up the plans and
specifications for a
building
is liable for damages if
within fifteen years
from the completion of
the structure, the
same should collapse by
reason of a defect in
those plans and
specifications, or due to
the
defects in the ground.
The contractor is
likewise responsible for
the damages if the
edifice falls, within the
same period, on
account of defects in the
construction or the
use of materials of
inferior quality furnished
by him, or due to any
violation of the terms of
the contract. If the
engineer or architect
supervises the
construction, he shall be
solidarily liable with the
contractor.
Acceptance of the
building, after
completion,
does not imply waiver of
any of the cause of
action by reason of any
defect mentioned in
the preceding
paragraph.
The action must be
brought within ten years
following the collapse of
the building.

Engineer or architect who drew up the plans

and specifications is liable if the building
collapses within 15 years due to:
(1) A defect in those plans and specifications;
or
(2) Due to the defects in the ground.
Contractor is liable if the edifice falls within 15
years due to:
(1) Defects in the construction;
(2) The use of materials of inferior quality
furnished by the contractor; or
(3) Due to any violation of the terms of the
contract.
Here, the plaintiff need only prove that such
conditions (defects) exist, and need not prove
that negligence of the defendant be the cause
of the conditions.
A.5. OWNERS OF ENTERPRISES OR
OTHER EMPLOYERS
Art. 1711. Owners of
enterprises and other
employers are obliged to
pay compensation
for the death of or
injuries to their laborers,
workmen, mechanics or
other employees,
even though the event
may have been purely
accidental or entirely
due to a fortuitous
cause, if the death or
personal injury arose
out of and in the course
of the employment.
The employer is also
liable for compensation
if the employee
contracts any illness or
disease caused by such
employment or as
the result of the nature
of the employment. If
the mishap was due to
the employee's own
notorious negligence, or
voluntary act, or
drunkenness, the
employer shall not be
liable for compensation.
When the
employee's lack of due
care contributed to
his death or injury, the
compensation shall
be equitably reduced.

Art. 1712. If the death

or injury is due to the
negligence of a fellow
worker, the latter and
the employer shall be
solidarily liable for
compensation. If a fellow
worker's intentional
malicious act is the only
cause of the death or
injury, the employer
shall not be answerable,

UP LAW BOC TORTS CIVIL LAW

524
unless it should be
shown that the latter did
not exercise due
diligence in the selection
or
supervision of the
plaintiff's fellow worker.

Alarcon v. Alarcon (1961): Alarcon, a teacher,

hired Urzino and Azaa to dig a well on his
land; in the course of which Urzino died of
asphyxia. The Court found that under the
principle of ejusdem generis, said other
employers mentioned in Article 1711 must be
construed to refer to persons who belong to a
class analogous to owners of enterprises,
such as those operating a business or engaged
in a particular industry or trade, requiring its
managers to contract the services of laborers,
workers and/or employees. Alarcon, not
owning any enterprise, did not fall under the
category of other employers.
Situations covered:
(1) Death or injury arising out of or in the
course of employment here, the
employer is liable even if the event which
caused the death or injury was purely
accidental or due to a fortuitous event
(2) Illness or disease caused by their
employment or as the result of the nature
of the employment
Defenses available to the employer:
(1) When death or injury is not caused by a
fellow worker
The mishap due to the employees own
notorious negligence or voluntary act, or
drunkenness
(2) When death or injury is caused by a fellow
worker
General rule: The employer is solidarily
liable with the fellow worker causing the
death or injury
Exception: If the only cause of the death
or injury was the fellow workers
intentional or malicious act
Exception to the exception: If it is shown
that the employer did not exercise due
diligence in the selection and supervision
of the fellow worker causing the death or
injury
A.6. HEAD OF A FAMILY FOR THINGS
THROWN OR FALLING
Art 2193. The head of a
family that lives in a
building or a part
thereof, is responsible
for
damages caused by
things thrown or falling
from the same.

The purpose of the law is to relieve the injured

party of the difficulty of determining and
proving who threw the thing or what caused it
to fall, or that either was due to the fault or
negligence of any particular individual.
Dingcong v. Kanaan (1941): Lessee is
considered as the head of the family. It is
enough that he lives in and has control over it.
A.7. PRODUCTS LIABILITY
i. MANUFACTURERS / PROCESSORS OF
FOODSTUFFS
Art. 2187.
Manufacturers and
processors of
foodstuffs, drinks, toilet
articles and similar
goods shall be liable for
death or injuries
caused by any noxious
or harmful substances
used, although no
contractual relation
exists
between them and the
consumers.

Under the foregoing provision, liability is not

made to depend upon fault or negligence of
the manufacturer or processor. The provision
likewise dispensed with any contractual
relation between the manufacturer and the
consumer, thereby clearly implying that
liability is imposed by law as a matter of public
policy.
Proof of negligence under this provision is not
necessary; as such, traditional contract and
warranty defenses as (1) lack of privity; (2) lack
UP LAW BOC TORTS CIVIL LAW
525
of reliance on a warranty; (3) lack of notice to
the defendant of the breach of warranty; and
(4) disclaimer of implied warranties are
inapplicable.
Requisites of liability
(a) Defendant is a manufacturer or possessor
of foodstuff, drinks, toilet articles and
similar goods;
(b) He used noxious or harmful substances in
the manufacture or processing of the
foodstuff, drinks or toilet articles
consumed or used by the plaintiff;
(c) Plaintiffs death or injury was caused by the
product so consumed or used; and
(d) The damages sustained and claimed by
the plaintiff and the amount thereof.
Burden of proof
The burden of proof that the product was in a
defective condition at the time it left the hands
of the manufacturer and particular seller is
upon the injured plaintiff.
Who may recover
Although the article used the term
consumer, such term includes a user and
purchaser of the injuriously defective food
product or toilet article. The person who may
recover need not be the purchaser of the
foodstuff or toilet article.
ii. CONSUMER ACT RA 7394, SECS. 92-
107 (CH. 1)
Consumer Act Provisions
Article 4. Definition of
Terms.
(n) "Consumer" means a
natural person who
is a purchaser, lessee,
recipient or
prospective purchaser,
lessor or recipient of
consumer products,
services or credit.
(as) "Manufacturer"
means any person who
manufactures,
assembles or processes
consumer products,
except that if the goods
are manufactured,
assembled or processed

for another person who

attaches his own
brand name to the
consumer products, the
latter shall be deemed
the manufacturer. In
case of imported
products, the
manufacturer's
representatives or, in his
absence, the importer,
shall be deemed the
manufacturer.

Article 92. Exemptions.

If the concerned
department finds that
for good or sufficient
reasons, full compliance
with the labeling
requirements otherwise
applicable under this
Act is impracticable or is
not necessary for
the adequate protection
of public health and
safety, it shall
promulgate regulations
exempting such
substances from these
requirements to the
extent it deems
consistent with the
objective of adequately
safeguarding public
health and safety, and
any hazardous
substance which does
not
bear a label in
accordance with such
regulations shall be
deemed mislabeled
hazardous substance.

Article 97. Liability for

the Defective Products.
Any Filipino or foreign
manufacturer,
producer, and any
importer, shall be liable
for redress,
independently of fault,
for
damages caused to
consumers by defects
resulting from design,
manufacture,
construction, assembly
and erection,
formulas and handling
and making up,
presentation or packing
of their products, as
well as for the
insufficient or
inadequate
information on the use
and hazards thereof.
A product is defective
when it does not offer
the safety rightfully
expected of it, taking
relevant circumstances
into consideration,
including but not limited
to:
(a) presentation of
product
(b) use and hazards
reasonably expected of
it;
(c) the time it was put
into circulation.
A product is not
considered defective
because another better
quality product has
been placed in the
market. The
manufacturer, builder,
producer or importer
shall not be held liable
when it evidences:

UP LAW BOC TORTS CIVIL LAW

526
(a) that it did not place
the product on the
market;
(b) that although it did
place the product on
the market such product
has no defect;
(c) that the consumer or
a third party is
solely at fault.

Article 98. Liability of

Tradesman or Seller.
The tradesman/seller is
likewise liable,
pursuant to the
preceding article when:
(a) it is not possible to
identify the
manufacturer, builder,
producer or
importer;
(b) the product is
supplied, without clear
identification of the
manufacturer,
producer, builder or
importer;
(c) he does not
adequately preserve
perishable goods. The
party making
payment to the
damaged party may
exercise the right to
recover a part of the
whole of the payment
made against the
other responsible
parties, in accordance
with their part or
responsibility in the
cause
of the damage effected.

Article 99. Liability for

Defective Services.
The service supplier is
liable for redress,
independently of fault,
for damages caused
to consumers by defects
relating to the
rendering of the
services, as well as for
insufficient or
inadequate information
on the
fruition and hazards
thereof.
The service is defective
when it does not
provide the safety the
consumer may
rightfully expect of it,
taking the relevant
circumstances into
consideration, including
but not limited to:
(a) the manner in which
it is provided;
(b) the result of hazards
which may
reasonably be expected
of it;
(c) the time when it was
provided.
A service is not
considered defective
because
of the use or
introduction of new
techniques.
The supplier of the
services shall not be
held
liable when it is proven:

(a) that there is no

defect in the service
rendered;
(b) that the consumer or
third party is solely
at fault.

Article 100. Liability for

Product and Service
Imperfection. The
suppliers of durable or
nondurable consumer
products are jointly
liable for imperfections
in quality that render
the products unfit or
inadequate for
consumption for which
they are designed or
decrease their value,
and for those resulting
from inconsistency with
the information
provided on the
container, packaging,
labels
or publicity
messages/advertisemen
t, with
due regard to the
variations resulting from
their nature, the
consumer being able to
demand replacement to
the imperfect parts.
If the imperfection is not
corrected within
thirty (30) days, the
consumer may
alternatively demand at
his option:
(a) the replacement of
the product by
another of the same
kind, in a perfect
state of use;
(b) the immediate
reimbursement of the
amount paid, with
monetary updating,
without prejudice to any
losses and
damages;
(c) a proportionate price
reduction.
The parties may agree
to reduce or increase
the term specified in the
immediately
preceding paragraph;
but such shall not be
less than seven (7) nor
more than one
hundred and eighty
(180) days.
The consumer may
make immediate use of
the alternatives under
the second paragraph
of this Article when by
virtue of the extent of
the imperfection, the
replacement of the
imperfect parts may
jeopardize the product
quality or
characteristics, thus
decreasing its
value.
If the consumer opts for
the alternative under
sub-paragraph (a) of the
second paragraph
of this Article, and
replacement of the
product is not possible,
it may be replaced by
another of a different
kind, mark or model:

UP LAW BOC TORTS CIVIL LAW

527
Provided, That any
difference in price may
result thereof shall be
supplemented or
reimbursed by the party
which caused the
damage, without
prejudice to the
provisions
of the second, third and
fourth paragraphs of
this Article.

Article 101. Liability for

Product Quantity
Imperfection. Suppliers
are jointly liable for
imperfections in the
quantity of the product
when, in due regard for
variations inherent
thereto, their net
content is less than that
indicated on the
container, packaging,
labeling or
advertisement, the
consumer
having powers to
demand, alternatively,
at
his own option:
(a) the proportionate
price
(b) the supplementing of
weight or measure
differential;
(c) the replacement of
the product by
another of the same
kind, mark or model,
without said
imperfections;
(d) the immediate
reimbursement of the
amount paid, with
monetary updating
without prejudice to
losses and damages
if any.
The provisions of the
fifth paragraph of
Article 99 shall apply to
this Article.
The immediate supplier
shall be liable if the
instrument used for
weighing or measuring is
not gauged in
accordance with official
standards.

Article 102. Liability for

Service Quality
Imperfection. The
service supplier is liable
for any quality
imperfections that
render the
services improper for
consumption or
decrease their value,
and for those resulting
from inconsistency with
the information
contained in the offer or
advertisement, the
consumer being entitled
to demand
alternatively at his
option:
(a) the performance of
the services, without
any additional cost and
when applicable;
(b) the immediate
reimbursement of the
amount paid, with
monetary updating
without prejudice to
losses and damages,

if any;
(c) a proportionate price
reduction.
Reperformance of
services may be
entrusted
to duly qualified third
parties, at the
supplier's risk and cost.
Improper services are
those which prove to
be inadequate for
purposes reasonably
expected of them and
those that fail to meet
the provisions of this Act
regulating service
rendering.

Article 103. Repair

Service Obligation.
When services are
provided for the repair of
any product, the supplier
shall be considered
implicitly bound to use
adequate, new,
original replacement
parts, or those that
maintain the
manufacturer's technical
specifications unless,
otherwise authorized,
as regards to the latter
by the consumer.

Article 104. Ignorance of

Quality
Imperfection. The
supplier's ignorance of
the quality imperfections
due to inadequacy
of the products and
services does not
exempt
him from any liability.

Article 105. Legal

Guarantee of Adequacy.

The legal guarantee of

product or service
adequacy does not
require an express
instrument or
contractual exoneration
of the
supplier being forbidden.

Article 106. Prohibition

in Contractual
Stipulation. The
stipulation in a contract
of
a clause preventing,
exonerating or reducing
the obligation to
indemnify for damages
effected, as provided for
in this and in the
preceding Articles, is
hereby prohibited, if
there is more than one
person responsible for
the cause of the
damage, they shall be
jointly
liable for the redress
established in the
pertinent provisions of
this Act. However, if
the damage is caused by
a component or
part incorporated in the
product or service,
its manufacturer, builder
or importer and the
person who incorporated
the component or
part are jointly liable.

UP LAW BOC TORTS CIVIL LAW

528
A.8. NUISANCE
Art. 694. A nuisance is
any act, omission,
establishment, business,
condition of
property, or anything
else which:
(1) Injures or endangers
the health or safety
of others; or
(2) Annoys or offends
the senses; or
(3) Shocks, defies or
disregards decency or
morality; or
(4) Obstructs or
interferes with the free
passage of any public
highway or street,
or any body of water; or
(5) Hinders or impairs
the use of property.

Art. 696. Every

successive owner or
possessor of property
who fails or refuses to
abate a nuisance in that
property started by a
former owner or
possessor is liable
therefor
in the same manner as
the one who created
it.

Art. 697. The

abatement of a nuisance
does
not preclude the right of
any person injured
to recover damages for
its past existence.

Art. 698. Lapse of time

cannot legalize any
nuisance, whether public
or private.

Nuisance is a condition and not an act or

failure to act, so that if a wrongful condition
exists, the person responsible for its existence
is responsible for the resulting damages to
others.
Sangco: A person who creates or maintains a
nuisance is liable for the resulting injury to
others regardless of the degree of care or skill
exercised to avoid the injury. The creation or
maintenance of a nuisance is a violation of an
absolute duty.
Liability for Negligence v. Liability for Nuisance
Negligence Nuisance
Liability is Liability attaches
Basis
based on lack regardless of the

of proper care skill exercised to

and diligence avoid the injury
There is continuing
harm being
Act complained suffered by the
of is already aggrieved party
Condition
done which because of the
of the act
caused injury to maintenance of
the plaintiff the act or thing
which constitutes
the nuisance
Action for
Remedy Abatement
damages

Easement against Nuisance

Art. 682. Every building
or piece of land is
subject to the easement
which prohibits the
proprietor or possessor
from committing
nuisance through noise,
jarring, offensive
odor, smoke, heat, dust,
water, glare and
other causes.

Art. 683. Subject to

zoning, health, police
and other laws and
regulations, factories
and
shops may be
maintained provided the
least
possible annoyance is
caused to the
neighborhood.

The provisions impose a prohibition upon

owners of buildings of land from committing
therein a nuisance or using such buildings or
lands in a manner as will constitute a
nuisance. It is based on the maxim sic utere tuo
ut alienum non laedas (so use your own as not
to injure anothers property).
Velasco v. Manila Electric Co. (1971): The
general rule is that everyone is bound to bear
the habitual or customary inconveniences that
result from the proximity of others, and so long
as this level is not surpassed, he may not
complain against them. But if the prejudice
exceeds the inconveniences that such
proximity habitually brings, the neighbor who
causes such disturbances is held responsible
UP LAW BOC TORTS CIVIL LAW
529
for the resulting damage, being guilty of
causing nuisance. There can be no doubt that
commercial and industrial activities which are
lawful in themselves may become nuisances if
they are so offensive to the senses that they
render the enjoyment of life and property
uncomfortable. It is no defense that skill and
care have been exercised and the most
improved methods and appliances employed
to prevent such result. In this case, the Court
ruled that causing or maintaining disturbing
noises or sounds may constitute an actionable
nuisance.
Types of Nuisance:
(1) Nuisance per se
It is recognized as a nuisance under any
and all circumstances because it
constitutes a direct menace to public
health and safety and, for that reason, may
be abated summarily under the undefined
law of necessity.
To become a nuisance per se, the thing
must, of itself, because of its inherent
qualities, without complement, be
productive of injury, or, by reason of the
matter of its use or exposure, threaten or
be dangerous to life or property.
(2) Nuisance per accidens
It becomes a nuisance depending upon
certain conditions and circumstances, and
its existence being a question of fact, it
cannot be abated without due hearing
thereon in a tribunal authorized to decide
whether such a thing does in law constitute
a nuisance.
Iloilo Ice and Cold Storage Co. v. Municipal
Council (1913): A nuisance is, according to
Blackstone, "Any thing that works3 hurt,
inconvenience, or damages." They arise
from pursuing particular trades or
industries in populous neighborhoods;
from acts of public indecency, keeping
disorderly houses, and houses of ill fame,
gambling houses, etc. Nuisances have
been divided into two classes: Nuisances
per se, and nuisances per accidens. To the
first belong those which are
unquestionably and under all
circumstances nuisances, such as
gambling houses, houses of ill fame, etc.
The number of such nuisances is
necessarily limited, and by far the greater
number of nuisances are such because of
particular facts and circumstances
surrounding the otherwise harmless cause
of the nuisance. For this reason, it will
readily be seen that whether a particular
thing is a nuisance is generally a question
of fact, to be determined in the first
instance before the term nuisance can be
applied to it.
(3) Public nuisance
Art. 695. Nuisance is
either public or private.
A public nuisance affects
a community or
neighborhood or any
considerable number of
persons, although the
extent of the
annoyance, danger or
damage upon
individuals may be
unequal. A private
nuisance is one that is
not included in the
foregoing definition.

A public nuisance is the doing of or the failure

to do something that injuriously affects safety,
health, or morals of the public, or works some
substantial annoyance, inconvenience or injury
to the public. It causes hurt, inconvenience, or
damage to the public generally, or such part of
the public as necessarily comes in contact with
it in the exercise of a public or common right.
Art. 699. The remedies
against a public
nuisance are:
(1) A prosecution under
the Penal Code or
any local ordinance: or
(2) A civil action; or

UP LAW BOC TORTS CIVIL LAW

530
(3) Abatement, without
judicial proceedings.

Art. 700. The district

health officer shall take
care that one or all of
the remedies against a
public nuisance are
availed of.

Art. 701. If a civil action

is brought by reason
of the maintenance of a
public nuisance,
such action shall be
commenced by the city
or municipal mayor.

Art. 702. The district

health officer shall
determine whether or
not abatement,
without judicial
proceedings, is the best
remedy against a public
nuisance.

Art. 703. A private

person may file an
action
on account of a public
nuisance, if it is
specially injurious to
himself.

Art. 704. Any private

person may abate a
public nuisance which is
specially injurious to
him by removing, or if
necessary, by
destroying the thing
which constitutes the
same, without
committing a breach of
the
peace, or doing
unnecessary injury. But
it is
necessary:
(1) That demand be first
made upon the
owner or possessor of
the property to
abate the nuisance;
(2) That such demand
has been rejected;
(3) That the abatement
be approved by the
district health officer and
executed with
the assistance of the
local police; and
(4) That the value of the
destruction does
not exceed three
thousand pesos.

(4) Private nuisance

It is one which violates only private rights
and produces damage to but one or a few
persons, and cannot be said to be public.
Art. 705. The remedies
against a private
nuisance are:
(1) A civil action; or
(2) Abatement, without
judicial proceedings.

Art. 706. Any person

injured by a private
nuisance may abate it
by removing, or if
necessary, by destroying
the thing which
constitutes the nuisance,
without committing
a breach of the peace or
doing unnecessary
injury. However, it is
indispensable that the
procedure for
extrajudicial abatement
of a
public nuisance by a
private person be
followed.

Art. 707. A private

person or a public
official
extrajudicially abating a
nuisance shall be
liable for damages:
(1) If he causes
unnecessary injury; or
(2) If an alleged
nuisance is later
declared by
the courts to be not a
real nuisance.

(5) Attractive Nuisance

General Rule: When people come to the
lands or premises of others for their own
purposes, without right or invitation, they
must take the lands as they see them.
Exception: Attractive Nuisance doctrine.
Hidalgo Enterprises v. Balandan (1952):
One who maintains on his premises
dangerous instrumentalities or appliances
of a character likely to attract children at
play, and who fails to exercise ordinary
care to prevent children from playing
therewith or resorting thereto, is liable to a
child of tender years who is injured
thereby, even if the child is technically a
trespasser in the premises. The principle
reason for the doctrine is that the condition
or appliance in question although its
danger is apparent to those of age, is so
enticing or alluring to children of tender
years as to induce them to approach, get
on or use it, and this attractiveness is an
implied invitation to such children.
Del Rosario v. Manila Electric Co. (1932): It is
doubtful whether contributory negligence can
properly be imputed to the deceased, owing to
UP LAW BOC TORTS CIVIL LAW
531
his immature years and the natural curiosity
which a child would feel to do something out of
the ordinary, and the mere fact that the
deceased ignored the caution of a companion
of the age of 8 years does not, in our opinion,
alter the case. Contributory negligence of a
minor does not bar recovery, where his
immaturity and natural curiosity impelled him
to act to his injury; but discretion shown by the
child is the decisive factor.
When Applicable/Not Applicable: [De Leon on
Torts and Damages]
The danger to the child must be caused by
the attraction itself, or by something with
which the attraction brings the child in
contact.
Protects a meddling child, but not a danger
which was created by the child himself.
Limited to latent dangers, and is no basis for
recovery where peril is obvious or patent.
Does not apply to natural dangers.
The age and maturity of the injured child and
the reason for the childs presence are
important considerations in the application
of the doctrine.
Summary of Strict Liability
Person Strictly Liable For What Defenses or Exceptions
Possessor of an animal
or
whoever makes use of Force majeure
For the damage the
them Fault of the person who
animal may cause
even if the animal is lost suffered damage
or
escaped
Solidary liability only if
the
owner was in the vehicle
and if
he could have prevented
Owner of Motor Vehicle Motor vehicle mishaps it
thru due diligence
If not in vehicle, apply
Art.
2180 for his liability as
employer
Manufacturers and
processors of foodstuffs,
drinks, toilet articles and
similar goods
Defendant in possession
of
dangerous weapons/
substances such as
firearms
and poison
Provinces, Cities and
Municipalities
Proprietor of building/
structure
Death and injuries
Absence of contractual
caused by any
relation
noxious or harmful
not a defense
substances used
Possession or use
Death or injury results thereof is
from such indispensable in his
possession occupation
or business
The death or injuries
suffered by any
person by reason of the The defective public
defective work is not
condition of roads, under the LGUs control
streets, bridges, or
public buildings, and supervision
other public
works
(a) Total or partial Responsibility for
collapse of collapse
building or structure if should be due to the
due to lack lack of
of necessary repairs necessary repairs

UP LAW BOC TORTS CIVIL LAW

532
(b) Explosion of machinery which has
not been taken cared of with due
diligence, and the inflammation of
explosive substances which have
not been kept in a safe and
adequate place
(c) By excessive smoke, which may be
harmful to persons or property
(d) By falling of trees situated at or
near highways or lanes, if not
caused by force majeure
(e) By emanations from tubes, canals,
sewers or deposits of infectious
matter, constructed without
precautions suitable to the place
Engineer or Architect If within 15 years from Action not brought within
completion of 10
the structure, the same years from collapse
should
collapse by reason of:
(a) Defects in the plans or
specifications; or
 (b) Defects in the ground.
If within the same period,
the edifice
falls on account of:
(a) Defects in the
construction;
(b) Used of materials of
inferior
quality furnished by him;
or
(c) Violation of the terms
of the
contract and he
supervised the
construction.
If within 15 years from
the completion
of the structure, the
edifice falls on
account of:
(a) Defects in the
Action not brought within
construction;
Contractor 10
(b) Used of materials of
years from collapse
inferior
quality furnished by him;
or
(c) Violation of the terms
of the
contract
Liable for damages
Head of the Family that
caused by things
lives in a building or any
thrown or falling from the
part thereof
same

UP LAW BOC DAMAGES CIVIL LAW

533

CIVIL LAW
DAMAGES
UP LAW BOC DAMAGES CIVIL LAW
534
I. Definition
People vs. Ballesteros (1998): Damages may be
defined as the pecuniary compensation,
recompense, or satisfaction for an injury
sustained, or as otherwise expressed, the
pecuniary consequences, which the law
imposes for the breach of some duty or the
violation of some right.
INJURY VS. DAMAGE VS. DAMAGES
Custodio v. CA (1996): Injury is the illegal
invasion of a legal right. Damage is the loss,
hurt, or harm, which results from the injury.
Damages are the recompense or compensation
awarded for the damage suffered.
Ocena vs. Icamina (1990): The obligation to
repair the damages exists whether done
intentionally or negligently and whether or not
punishable by law.
Heirs of Borlado v Vda. De Bulan (2001).
Damages must be in Philippine legal tender
currency.
WHEN DAMAGES MAY BE
RECOVERED
Custodio v CA (1996). The mere fact that the
plaintiff suffered losses does not give rise to a
right to recover damages. To warrant the
recovery of damages, there must be both a
right of action for a legal wrong inflicted by the
defendant, and damage resulting to the
plaintiff therefrom. Wrong without damage, or
damage without wrong, does not constitute a
cause of action, since damages are merely part
of the remedy allowed for the injury caused by
a breach or wrong.
ELEMENTS FOR RECOVERY OF
DAMAGES
(1) Right of action
(2) For a wrong inflicted by the defendant
(3) Damage resulting to the plaintiff
CLASSIFICATION
Art. 2197. Damages may
be:
(1) Actual or
compensatory;
(2) Moral;
(3) Nominal;
(4) Temperate or
moderate;
(5) Liquidated; or
(6) Exemplary or
corrective.

ACCORDING TO PURPOSE
(1) For adequate reparation of the injury
(a) Compensatory (reparation of
pecuniary losses)
(b) Moral (reparation for non-pecuniary
losses: injury to feelings; physical
suffering, etc.)
(2) For vindication of the right violated:
Nominal
(3) For less than adequate reparation:
Moderate
(4) For deterring future violations: Exemplary
or corrective
ACCORDING TO MANNER OF
DETERMINATION
(1) Conventional (or liquidated)
(2) Non-conventional, which may either be:
(a) Statutory (fixed by law, as in
moratory interest)
(b) Judicial (determined by the courts)
SPECIAL AND ORDINARY
GENERAL DAMAGES
Those which are the natural and necessary
result of the wrongful act or omission asserted
as the foundation of liability, and include those
which follow as a conclusion of law from the
statement of the facts of the injury.
SPECIAL DAMAGES
UP LAW BOC DAMAGES CIVIL LAW
535
Damages that arise from the special
circumstance of the case, which, if properly
pleaded, may be added to the general
damages which the law presumes or implies
from the mere invasion of the plaintiffs rights.
Special damages are the natural, but NOT the
necessary result of an injury. These are not
implied by law.
II. Actual &
Compensatory Damages
Compensatory damages are damages in
satisfaction of, or in recompense for, loss or
injury sustained. The phrase actual damages
is sometimes used as synonymous with
compensatory damages.
REQUISITES
Asilio, Jr. v. People and Sps. Bombasi (2011): To
seek recovery of actual damages, it is
necessary to prove the actual amount of loss
with a reasonable degree of certainty,
premised upon competent proof and on the
best evidence obtainable.
WHEN IS A PERSON ENTITLED?
(1) When there is a pecuniary loss suffered by
him;
(2) When he has alleged and prayed for such
relief (Manchester Devt Corp vs. CA (1987));
(3) When he has duly proved it;
(4) When provided by law or by stipulation.
No proof of pecuniary loss is necessary for:
moral, nominal, temperate, liquidated or
exemplary damages. The assessment of such
damages is discretionary upon the court,
except liquidated ones. (Art. 2216)
ALLEGED AND PROVED WITH
CERTAINTY
Art. 2199. Except as
provided by law or by

stipulation, one is
entitled to an adequate
compensation only for
such pecuniary loss
suffered by him as he
has duly proved. Such
compensation is referred
to as actual or
compensatory damages.

The damages must be proven by competent

evidence (admissible or probative)
Oceaneering Contractors v Baretto (2011). There
must be pleading and proof of actual damages
suffered for the same to be recovered. In
addition to the fact that the amount of loss
must be capable of proof, it must also be
actually proven with a reasonable degree of
certainty, premised upon competent proof or
the best evidence obtainable. The burden of
proof of the damage suffered is, consequently,
imposed on the party claiming the same, who
should adduce the best evidence available in
support thereof In the absence
of corroborative evidence, it has been held that
self-serving statements of account are not
sufficient basis for an award of actual
damages.
MCC Industrial Sales Corp. v Ssangyong Corp.
(2007). Actual or compensatory damages
cannot be presumed, but must be proven with
a reasonable degree of certainty.
Valencia vs. Tantoco (1956): Damages must be
proved with reasonable accuracy, even when
not denied.
DEGREE OF CERTAINTY REQUIRED AS
TO: FACT, CAUSE AND AMOUNT OF
DAMAGES
Damages are not rendered uncertain just
because they cannot be calculated with
absolute exactness or because the
consequences of the wrong are not precisely
definite in pecuniary amount.
The principle, which will disallow recovery of
damages when their existence rests solely on
UP LAW BOC DAMAGES CIVIL LAW
536
speculation, applies both to the fact and cause
of damages.
(1) The requirement of certainty does not
prevent the drawing of reasonable
inferences from the fact and circumstance
in evidence.
(2) Events which occur after the wrong
complained of may serve to render the
damage sufficiently certain.
(3) The damages must be susceptible of
ascertainment in some manner other than
by mere speculation, conjecture or surmise
and by reference to some fairly definite
standard, such as market value,
established experience or direct inference
from known circumstances.
Talisay-Silay vs. Associacion (1995): Where,
however, it is reasonably certain that injury
consisting of failure to realize otherwise
reasonably expected profits had been incurred,
uncertainty as to the precise amount of such
unrealized profits will not prevent recovery or
the award of damages.
COMPONENTS
Actual damage covers the following:
(1) Value of loss; unrealized profit
(2) Attorneys fees and expenses of litigation
(3) Interest
LOSS COVERED;
In General
Art. 2200.
Indemnification for
damages shall
comprehend not only
the value of the loss
suffered, but also that of
the profits which
the obligee failed to
obtain.

In other words, indemnification for damages is

not limited to damnum emergens (actual loss)
but extends to lucrum cessans (a cession of
gain or amount of profit lost).
Candano Shipping Lines, Inc. v Sugata-on
(2007). The award of damages for loss of
earning capacity is concerned with the
determination of losses or damages sustained
by the [plaintiffs], as dependents and intestate
heirs of the deceased, and that said damages
consist, not of the full amount of his earnings,
but of the support they received or would have
received from him had he not died in
consequence of negligence of [defendants]
agent Only net earnings, and not gross
earnings are to be considered. That is, the total
of the earnings less expenses necessary in the
creation of such earnings or income and less
living and other incidental expenses.
EXTENT OR SCOPE OF ACTUAL
DAMAGES
Source Extent of Liability
Art. Contracts -If the obligor acted in
2201 and Quasi GOOD
contracts FAITH, he shall be liable for
natural and probable
consequences of the
breach,
which the parties have
foreseen or could have
reasonably foreseen at the
time the obligation was
constituted.
-If the obligor acted with
FRAUD, BAD FAITH, MALICE
or WANTON ATTITUDE, he
shall be responsible for all
damages which may be
reasonably attributed to
 the
breach.
Liability extends to all
damages which are the
natural and probable
consequence of the act or
Crimes and
Art. omission complained of
Quasi
2202 WON the damage was
delicts
foreseen or could have
been
reasonably foreseen by the
defendant is irrelevant

IN CONTRACTS AND QUASICONTRACTS

UP LAW BOC DAMAGES CIVIL LAW
537
Art. 2201. In contracts
and quasi-contracts,
the damages for which
the obligor who acted
in good faith is liable
shall be those that are
the natural and probable
consequences of
the breach of the
obligation, and which
the
parties have foreseen or
could have
reasonably foreseen at
the time the
obligation was
constituted.
In case of fraud, bad
faith, malice or wanton
attitude, the obligor
shall be responsible for
all damages which may
be reasonably
attributed to the non-
performance of the
obligation.

Art. 2214. In quasi

delicts, the contributory
negligence of the
plaintiff shall reduce the
damages that he may
recover.
Art. 2215. In contracts,
quasi-contracts, and
quasi-delicts, the court
may equitably
mitigate the damages
under circumstances
other than the case
referred to in the
preceding article, as in
the following
instances:
(1) That the plaintiff
himself has
contravened the terms
of the contract;
(2) That the plaintiff has
derived some
benefit as a result of the
contract;
(3) In cases where
exemplary damages are
to be awarded, that the
defendant acted
upon the advice of
counsel;
(4) That the loss would
have resulted in any
event;
(5) That since the filing
of the action, the
defendant has done his
best to lessen
the plaintiff's loss or
injury.

Daywalt vs. Recoletos et al. (1919): The damages

recoverable upon breach of contract are,
primarily, the ordinary, natural and in a sense
the necessary damages resulting from the
breach. Other damages, known as special
damages, are recoverable where it appears
that the particular conditions which made such
damages a probable consequence of the
breach were known to the delinquent party at
the time the contract was made.
BPI Family Bank v Franco (2007). Bad faith
does not simply connote bad judgment or
negligence; it imports a dishonest purpose or
some moral obliquity and conscious doing of
wrong; it partakes of the nature of fraudBPIFB acted out of the impetus of self-
protection
and not out of malevolence or ill will. BPI-FB
was not in the corrupt state of mind
contemplated in Article 2201 and should not
be held liable for all damages now being
imputed to it for its breach of obligation.
Spouses Zalamea v CA (1993). That there was
fraud or bad faith on the part of respondent
airline when it did not allow petitioners to
board their flight in spite of confirmed tickets
cannot be disputed. Overbooking amounts to
bad faith, entitling the passengers concerned
to an award of moral damages.
IN CRIMES AND QUASI-DELICTS
Art. 2202. In crimes and
quasi delicts, the
defendant shall be liable
for all damages
which are the natural
and probable
consequences of the act
or omission
complained of. It is not
necessary that such
damages have been
foreseen or could have
reasonably been
foreseen by the
defendant.

In case of crimes, damages are to be increased

or decreased according to aggravating or
mitigating circumstances present.
Interest, as part of damages, may be
adjudicated in a proper case, in the Courts
discretion.
Contributory negligence of the plaintiff, in case
of quasi-delicts, shall reduce the damages to
which he may be entitled. However, in case of
crimes, there is no mitigation for contributory
negligence of the plaintiff.
People v Sarcia (2009). The
indemnity authorized by our criminal law as
UP LAW BOC DAMAGES CIVIL LAW
538
civil liability ex delicto for the offended party, in
the amount authorized by the prevailing
judicial policy and aside from other proven
actual damages, is itself equivalent to actual
or compensatory damages in civil law. The
principal consideration for the award of
damages is the penalty provided by law or
imposable for the offense because of its
heinousness, not the public penalty actually
imposed on the offender Hence,
notwithstanding the fact that the imposable
public penalty against the offender should be
lowered due to his minority, there is no
justifiable ground to depart from the
jurisprudential trend in the award of damages
in the case of qualified rape, considering the
compensatory nature of the award of civil
indemnity and moral damages.
EARNING CAPACITY, BUSINESS
STANDING
Art. 2205. Damages may
be recovered:
(1) For loss or
impairment of earning
capacity
in cases of temporary or
permanent
personal injury;
(2) For injury to the
plaintiff's business
standing or commercial
credit.

LOSS OR IMPAIRMENT OF EARNING

CAPACITY
Gatchalian vs. Delim (1991): The Court did not
award actual damages because it was found
that plaintiffs employment was lost even
before the injury upon which she was suing.
The Court equated loss of employment with
loss of earning capacity.
Mercury Drug v Huang (2007). The plaintiff
need not be actually engaged in gainful
employment to recover damages due to loss or
impairment of earning capacity. In determining
the amount of damages to be awarded, the
Supreme Court considered the plaintiffs age,
probable life expectancy, the state of his
health, and his mental and physical condition
before the accident Taking into account [the
plaintiffs] outstanding abilities, he would have
enjoyed a successful professional career in
banking.
INJURY TO BUSINESS STANDING OR
COMMERCIAL CREDIT
Tanay Recreation Center vs. Fausto (2005): Loss
of goodwill should be proven with the same
standard of proof as other compensatory
damages.
FORMULA FOR THE NET EARNING
CAPACITY
People vs. Aringue (1997):
Net earning capacity = Life expectancy * (Gross
annual income Reasonable living expenses)
Where:
Life expectancy = 2/3 * (80 age of victim at
the time of death)
Tan, et al. vs. OMC Carriers, Inc. (2011): As a
rule, documentary evidence should be
presented to substantiate the claim for loss of
earning capacity.
By way of exception, damages for loss of
earning capacity may be awarded despite the
absence of documentary evidence when: (1) the
deceased is self-employed and earning less
than the minimum wage under current labor
laws, in which case, judicial notice may be
taken of the fact that in the deceased's line of
work, no documentary evidence is available; or
(2) the deceased is employed as a daily wage
worker earning less than the minimum wage
under current labor laws.
DEATH BY CRIME OR QUASI-DELICT
Art. 2206. The amount
of damages for death
caused by a crime or
quasi-delict shall be at
least three thousand
pesos, even though
there may have been
mitigating

UP LAW BOC DAMAGES CIVIL LAW

539
circumstances.
In addition:
(1) The defendant shall
be liable for the loss
of the earning capacity
of the deceased,
and the indemnity shall
be paid to the
heirs of the latter; such
indemnity shall in
every case be assessed
and awarded by
the court, unless the
deceased on
account of permanent
physical disability
not caused by the
defendant, had no
earning capacity at the
time of his death;
(2) If the deceased was
obliged to give
support according to the
provisions of
article 291, the recipient
who is not an
heir called to the
decedent's inheritance
by the law of testate or
intestate
succession, may
demand support from
the person causing the
death, for a
period not exceeding
five years, the exact
duration to be fixed by
the court;
(3) The spouse,
legitimate and
illegitimate
descendants and
ascendants of the
deceased may demand
moral damages
for mental anguish by
reason of the
death of the deceased.

CIVIL / DEATH INDEMNITY

Prof. Casis Book on Damages:
Mere commission of the crime shall entitle the
heirs of the deceased to such damages.
But there has been inconsistency as to whether
indemnity is 50,000 or 75,000.
AS TO THE LOSS OF EARNING CAPACITY
General Rule:
shall be awarded in every case, and that
claimant shall present documentary evidence
to substantiate claim for damages.
Exceptions:
(1) If the deceased was self-employed and
earning less than the minimum wage; or
(2) The deceased was a daily wage worker
earning less than the minimum wage.
Additional exception found in Pleyto vs. Lomboy
(2004):
Testimonial evidence suffices to establish a
basis for which the court can make a fair and
reasonable estimate of the loss of earning
capacity.
Note: Such an exception to documentary proof
requirement only exists as to the loss of
earning capacity.
IN RAPE CASES
No statutory basis but in several cases the
court awards compensatory damages to
victims of rape.
People vs. Astrologo (2007): Civil indemnity, in
the nature of actual and compensatory
damages, is mandatory upon the finding of the
fact of rape. Awarded Php. 50,000 for simple
rape.
People vs. Apattad (2011): When imposable
penalty is death, then the civil indemnity must
be Php. 75,000.
People vs. Bartolini (2010): The SC held that it
could not be proven that the age of the victim
was such that it would support a penalty of
death. Thus, it imposed reclusion perpetua
instead. But SC said that this should not affect
the civil liability to be imposed, and
maintained the same at Php. 75,000.
People vs. Pascual (2009): In cases of rape with
homicide, civil indemnity in the amount of Php.
100,000 should be awarded to the heirs of the
victim.
ATTORNEYS FEES AND EXPENSES OF
LITIGATION
Art. 2208. In the
absence of stipulation,
attorney's fees and
expenses of litigation,
other than judicial costs,
cannot be
UP LAW BOC DAMAGES CIVIL LAW
540
recovered, except:
(1) When exemplary
damages are awarded;
(2) When the
defendant's act or
omission
has compelled the
plaintiff to litigate
with third persons or to
incur expenses to
protect his interest;
(3) In criminal cases of
malicious
prosecution against the
plaintiff;
(4) In case of a clearly
unfounded civil action
or proceeding against
the plaintiff;
(5) Where the defendant
acted in gross and
evident bad faith in
refusing to satisfy the
plaintiff's plainly valid,
just and
demandable claim;
(6) In actions for legal
support;
(7) In actions for the
recovery of wages of
household helpers,
laborers and skilled
workers;
(8) In actions for
indemnity under
workmen's
compensation and
employer's liability
laws;
(9) In a separate civil
action to recover civil
liability arising from a
crime;
(10)When at least
double judicial costs are
awarded;
(11) In any other case
where the court deems
it just and equitable that
attorney's fees
and expenses of
litigation should be
recovered.
In all cases, the
attorney's fees and
expenses
of litigation must be
reasonable.

General Rule
Attorneys fees and costs of litigation are
recoverable IF stipulated.
Exceptions
If there is no stipulation, they are recoverable
only in the following cases:
(1) By reason of malice or bad faith
(a) When exemplary damages are
awarded
(b) In case of a clearly unfounded civil
action
(c) Where defendant acted in gross and
evident bad faith
(d) When at least double judicial costs are
awarded
(1) By reason of plaintiffs indigence in
(a) Actions for legal support
(b) Actions for recovery of wages of
laborers, etc.
(c) Actions for workmens compensation
(2) By reason of crimes in
(a) Criminal cases of malicious
prosecution
(b) Separate actions to recover civil
liability arising from crime
(3) By reason of equity
(a) Where the defendants act
compelled plaintiff to litigate with
third persons
(b) Where the Court deems it just and
equitable
Note: In all cases, attorneys fees and costs of
litigation must be reasonable.
Even if expressly stipulated, attorneys fees are
subject to control by the Courts.
Quirante v IAC (1989). Attorneys fees in CC
2208 is an award made in favor of the litigant,
not of his counsel, and the litigant, not his
counsel, is the judgment creditor who may
enforce the judgment for attorney's fees by
execution.
MERALCO v Ramoy (2008). Attorney's fees
cannot be recovered except in cases provided
for in CC 2208.
Briones v Macabagdal (2010). Attorneys fees
and expenses of litigation are recoverable only
in the concept of actual damages, not as moral
damages nor judicial costs. Hence, such must
be specifically prayed forand may not be
deemed incorporated within a general prayer
for "such other relief and remedy as this court
may deem just and equitable."
UP LAW BOC DAMAGES CIVIL LAW
541
Bank of America v Philippine Racing Club
(2009). For CC 2208 (2), an adverse decision
does not ipso facto justify an award of
attorneys fees to the winning party. Even when
a claimant is compelled to litigate with third
persons or to incur expenses to protect his
rights, still attorneys fees may not be awarded
where no sufficient showing of bad faith could
be reflected in a partys persistence in a case
other than an erroneous conviction of the
righteousness of his cause.
INTEREST
Art. 2209. If the
obligation consists in the
payment of a sum of
money, and the debtor
incurs in delay, the
indemnity for damages,
there being no
stipulation to the
contrary,
shall be the payment of
the interest agreed
upon, and in the
absence of stipulation,
the
legal interest, which is
six per cent per
annum.

Art. 2210. Interest may,

in the discretion of
the court, be allowed
upon damages
awarded for breach of
contract.

Art. 2211. In crimes and

quasi-delicts, interest
as a part of the damages
may, in a proper
case, be adjudicated in
the discretion of the
court.

Art. 2212. Interest due

shall earn legal
interest from the time it
is judicially
demanded, although the
obligation may be
silent upon this point.

Art. 2213. Interest

cannot be recovered
upon
unliquidated claims or
damages, except
when the demand can
be established with
reasonable certainty.

Interest accrues when:

(1) The obligation consists in the payment of a
sum of money
(2) Debtor incurs in delay
(3) There being no stipulation to the contrary
No interest may be recovered on unliquidated
(not fixed in amount) claims or damages,
except when the demand can be established
with reasonable certainty at the Courts
discretion.
Compounding of interest
Interest due shall earn legal interest from the
time it is judicially demanded, although the
obligation may be silent on the point.
Note that interest due can earn only at 6%,
whether the rate of interest of the principal is
greater than 6%.
Determination of legal interest
(1) When an obligation, regardless of its
source (i.e., law, contracts, quasicontracts, delicts or quasi-delicts) is
breached, the contravenor can be held
liable for damages.
(2) With regard particularly to an AWARD OF
INTEREST in the concept of actual and
compensatory damages, the RATE of
interest, as well as the ACCRUAL thereof,
is imposed, as follows (Eastern Shipping
Lines vs. CA, (1994) as modified by Nakar v.
Gallery Frames, G.R. No. 189871 (2013)):
(a)That
which
may have
(a) When the To be
been
obligation is computed
stipulate
breached, and it from default,
d in
consists in the i.e., from
writing.
JUDICIAL or
PAYMENT OF A (b) In the
EXTRAJUDICI
SUM OF MONEY, absence
AL demand
i.e., a loan or of
under and
forbearance of stipulatio
subject to the
money, the n, the
provisions of
interest due rate of
Article 1169 of
interest
should be- the Civil Code.
shall be
6% per
annum

UP LAW BOC DAMAGES CIVIL LAW

542
(legal
interest)
(b) Furthermor From the time
e, the INTEREST Legal it is
DUE shall itself interest JUDICIALLY
earn demanded.
(c) When an 6% per If claim or
obligation, NOT annum. damages are
constituting a LIQUIDATED,
loan or from default,
i.e., from
forbearance of
judicial or
money, is extrajudicial
breached, an demand. (Art.
interest on the 1169, Civil
AMOUNT OF Code)
DAMAGES If
awarded may be UNLIQUIDATE
imposed at the D, from the
discretion of the time the
court. demand can
The actual base for be established
the computation of with
legal interest shall reasonable
be on the amount certainty.
finally adjudged. Hence, the
 interest shall
begin to run
only FROM
THE DATE
THE
JUDGMENT
OF THE
COURT IS
MADE (at
which time the
quantification
of damages
may be
deemed to
have been
reasonably
ascertained).
(d) When the 6% per From
JUDGMENT of the annum FINALITY

court awarding a UNTIL ITS

sum of money SATISFACTIO
becomes final and N, this period
executory, being deemed
whether or not the to be an
case consists in equivalent to a
the payment of a forbearance of
sum of money credit.

Note:
The new rate of legal interest (6%) in Nacar
does not apply to judgments that have become
final and executory prior to July 1, 2013.
Start of Delay
(1) Extrajudicial: Demand letter
(2) Judicial: Filing of complaint
(3) Award
Duty to Minimize
Art. 2203. The party
suffering loss or injury
must exercise the
diligence of a good
father
of a family to minimize
the damages
resulting from the act or
omission in
question.

Lim and Gunnaban vs. CA (2002): Article 2203

of the Civil Code exhorts parties suffering from
loss or injury to exercise the diligence of a good
father of a family to minimize the damages
resulting from the act or omission in question.
One who is injured then by the wrongful or
negligent act of another should exercise
reasonable care and diligence to minimize the
resulting damage. Anyway, he can recover
from the wrongdoer money lost in reasonable
efforts to preserve the property injured and for
injuries incurred in attempting to prevent
damage to it.
Burden of Proof
The DEFENDANT has the burden of proof to
establish that the victim, by the exercise of the
diligence of a good father of a family, could
have mitigated the damages. In the absence of
UP LAW BOC DAMAGES CIVIL LAW
543
such proof, the amount of damages cannot be
reduced.
Note:
The victim is required only to take such steps
as an ordinary prudent man would reasonably
adopt for his own interest.
III. Moral Damages
Art. 2217. Moral
damages include
physical
suffering, mental
anguish, fright, serious
anxiety, besmirched
reputation, wounded
feelings, moral shock,
social humiliation, and
similar injury. Though
incapable of pecuniary
computation, moral
damages may be
recovered if they are the
proximate result of
the defendant's wrongful
act or omission.

Art. 2218. In the

adjudication of moral
damages, the
sentimental value of
property,
real or personal, may be
considered.

Visayan Sawmill vs. CA (1993): Moral damages

are emphatically not intended to enrich a
complainant at the expense of the defendant.
Its award is aimed at the restoration, within the
limits of the possible, of the spiritual status
quo ante, and it must be proportional to the
suffering inflicted.
Bagumbayan Corp. vs. IAC (1984): Mental
suffering means distress or serious pain as
distinguished from annoyance, regret or
vexation.
Mental anguish is intense mental suffering.
Generally, damages for mental anguish are
limited to cases in which there has been a
personal physical injury or where the
defendant willfully, wantonly, recklessly, or
intentionally caused the mental anguish.
WHEN AWARDED
Awarded when injury consists of:
(1) Physical suffering
(2) Besmirched reputation
(3) Mental anguish
(4) Fright
(5) Moral shock
(6) Wounded feelings
(7) Social humiliation
(8) Serious anxiety
(9) Similar injury
Though incapable of pecuniary computation
If such is the proximate result of defendants
act or omission.
REQUISITES FOR AWARDING MORAL
DAMAGES
Sulpicio Lines v Curso (2010). The conditions for
awarding moral damages are:
(a) There must be an injury, whether physical,
mental, or psychological, clearly
substantiated by the claimant;
(b) There must be a culpable act or omission
factually established;
(c) The wrongful act or omission of the
defendant must be the proximate cause of
the injury sustained by the claimant; and
(d) The award of damages is predicated on
any of the cases stated in Article 2219 of
the Civil Code.
GENERAL PRINCIPLES OF RECOVERY:
(1) Moral damages must somehow be
proportional to the suffering inflicted.
(2) In culpa contractual or breach of contract,
moral damages may be recovered when
the defendant acted in bad faith or was
guilty of gross negligence (amounting to
bad faith) or in wanton disregard of his
contractual obligation and, exceptionally,
when the act of breach of contract itself is
constitutive of tort resulting in physical
injuries.
(3) By special rule in Article 1764, in relation
to Article 2206, moral damages may also
be awarded in case the death of a
UP LAW BOC DAMAGES CIVIL LAW
544
passenger results from a breach of
carriage.
(4) In culpa aquiliana or quasi-delict,
(a) when an act or omission causes
physical injuries, or
(b) where the defendant is guilty of
intentional tort, moral damages may
aptly be recovered. This rule also
applies to contracts when breached
by tort.
(5) In culpa criminal, moral damages could be
lawfully due when the accused is found
guilty of physical injuries, lascivious acts,
adultery or concubinage, illegal or
arbitrary detention, illegal arrest, illegal
search, or defamation.
(6) Malicious prosecution can also give rise to
a claim for moral damages. The term
"analogous cases," referred to in Article
2219, following the ejusdem generis rule,
must be held similar to those expressly
enumerated by the law.
(7) Although the institution of a clearly
unfounded civil suit can at times be a legal
justification for an award of attorney's
fees, such filing, however, has almost
invariably been held not to be a ground for
an award of moral damages. (Expertravel&
Tours vs. CA (1999))
(8) The burden rests on the person claiming
moral damages to show convincing
evidence for good faith is presumed. In a
case involving simple negligence, moral
damages cannot be recovered. (Villanueva
vs. Salvador (2006))
(9) Failure to use the precise legal terms or
"sacramental phrases" of "mental
anguish, fright, serious anxiety, wounded
feelings or moral shock" does not justify
the denial of the claim for damages. It is
sufficient that these exact terms have been
pleaded in the complaint and evidence has
been adduced (Miranda-Ribaya vs.
Bautista (1980))
(10) Even if the allegations regarding the
amount of damages in the complaint are
not specifically denied in the answer, such
damages are not deemed admitted.
(Raagas, et al. vs. Traya et al (1968)).
(11) An appeal in a criminal case opens the
whole case for review and this 'includes
the review of the penalty, indemnity and
damages. Even if the offended party had
not appealed from said award, and the
only party who sought a review of the
decision of said court was the accused, the
court can increase damages awarded.
(Sumalpong vs. CA (1997))
(12) It can only be awarded to natural persons.
ABS-CBN vs. CA (1999): The award of moral
damages cannot be granted in favor of a
corporation because, being an artificial person
and having existence only in legal
contemplation, it has no feelings, no emotions,
no senses, It cannot, therefore, experience
physical suffering and mental anguish, which
can be experienced only by one having a
nervous system. The statement in People vs.
Manero and Mambulao Lumber Co. vs. PNB
that a corporation may recover moral damages
if it "has a good reputation that is debased,
resulting in social humiliation" is an obiter
dictum.
NAPOCOR vs. Philipp Brothers (2001): While it
is true that besmirched reputation is included
in moral damages, it cannot cause mental
anguish to a corporation, unlike in the case of a
natural person, for a corporation has no
reputation in the sense that an individual has,
and besides, it is inherently impossible for a
corporation to suffer mental anguish.
QUESTION
Ortillo contracts
Fabricato, Inc. to supply
and
install tile materials in a
building he is
donating to his province.
Ortillo pays 50% of
the contract price as per
agreement. It is
also agreed that the
balance would be

UP LAW BOC DAMAGES CIVIL LAW

545
payable periodically
after every 10%
performance until
completed. After
performing about 93% of
the contract, for
which it has been paid
an additional 40% as
per agreement,
Fabricato, Inc. did not
complete the project
due to its sudden
cessation of operations.
Instead, Fabricato,
Inc. demands payment
of the last 10% of the
contract despite its non-
completion of the
project. Ortillo refuses to
pay, invoking the
stipulation that payment
of the last amount
of 10% shall be upon
completion. Fabricato,
Inc. brings suit for the
entire 10% plus
damages. Ortillo
counters with claims for
(a)
moral damages for
Fabricato, Inc.s
unfounded suit which
has damaged his
reputation as a
philanthropist and
respected
businessman in his
community, and (b)
attorneys fees.
Does Ortillo have a legal
basis for his claim
for moral damages?
How about his claim for
attorneys fees,
having hired a lawyer to
defend him?
Suggested Answer:
(a) There is no legal
basis to Ortillos claim
for moral damages. It
does not fall
under the coverage of
Article 2219 of the
New Civil Code.
(b) Ortillo is entitled to
attorneys fees
because Fabricatos
complaint is a case
of malicious prosecution
or a clearly
unfounded civil action
(Art. 2208 [4] and
[11], NCC).

WHEN RECOVERABLE
Art. 2219. Moral
damages may be
recovered
in the following and
analogous cases:
(1) A criminal offense
resulting in physical
injuries;
(2) Quasi-delicts causing
physical injuries;
(3) Seduction,
abduction, rape, or other
lascivious acts;
(4) Adultery or
concubinage;
(5) Illegal or arbitrary
detention or arrest;

(6) Illegal search;

(7) Libel, slander or any
other form of
defamation;
(8) Malicious
prosecution;
(9) Acts mentioned in
article 309;
(10) Acts and actions
referred to in articles 21,
26, 27, 28, 29, 30, 32,
34, and 35.
The parents of the
female seduced,
abducted, raped, or
abused, referred to in
No. 3 of this article, may
also recover moral
damages.
The spouse,
descendants,
ascendants, and
brothers and sisters may
bring the action
mentioned in No. 9 of t
his article, in the
order named.

IN CRIMINAL OFFENSE RESULTING IN

PHYSICAL INJURIES
People v Villaver (2001). Under paragraph (1),
Article 2219 of the Civil Code, moral damages
may be recovered in a criminal offense
resulting in physical injuries. In its generic
sense, "physical injuries" includes death.
Arcona v CA (2002). In a case where the father
of a family was stabbed to death, the SC said
that a violent death invariably and necessarily
brings about emotional pain and anguish on
the part of the victims family For this reason,
moral damages must be awarded even in the
absence of any allegation and proof of the
heirs emotional suffering.
IN QUASI-DELICTS CAUSING PHYSICAL
INJURIES
B.F. Metal v Lomotan (2008). In culpa
aquiliana, or quasi-delict, moral damages may
be recovered (a) when an act or omission
causes physical injuries, or (b) where the
defendant is guilty of intentional tort. The SC
held that an employer that is vicariously liable
with its employee-driver may also be held
liable for moral damages to the injured
plaintiff,
UP LAW BOC DAMAGES CIVIL LAW
546
IN SEDUCTION, ABDUCTION, RAPE AND
OTHER LASCIVIOUS ACTS
People vs. Calongui (2006): Anent the award of
damages, civil indemnity ex delicto is
mandatory upon finding of the fact of rape
while moral damages is awarded upon such
finding without need of further proof because it
is assumed that a rape victim has actually
suffered moral injuries entitling the victim to
such award. If without factual and legal bases,
no award of exemplary damages should be
allowed.
People v Bartolini (2010). In a case where the
offender-father was convicted of simple rape
instead of qualified rape due to the
prosecutions failure to specifically allege the
age and minority of the victim-daughter, but
such was nonetheless established during the
trial, the award of civil indemnity and moral
damages in a conviction for simple rape should
equal the award of civil indemnity and moral
damages in convictions for qualified rape.
Truly, [the victims] moral suffering is just as
great as when her father who raped her is
convicted for qualified rape as when he is
convicted only for simple rape due to a
technicality.
People v Abadies (2002). Where there are
multiple counts of rape and other lascivious
acts, the SC awarded moral damages for each
count of lascivious acts and each count of rape.
Note: Recovery may be had by the offended
party and also by her parents.
IN ILLEGAL OR ARBITRARY DETENTION
OR ARREST
People v Bernardo (2002). Since the crime
committed in this case is kidnapping and
failure to return a minor under Article 270 of
the Revised Penal Code, the same is clearly
analogous to illegal and arbitrary detention or
arrest, thereby justifying the award of moral
damages.
IN CASE OF MALICIOUS PROSECUTION
Industrial Insurance v Bondad (2000). As a rule,
no moral damages is imposed for litigation,
because the law could not have meant to
impose a penalty on the right to litigate. A
person's right to litigate, as a rule, should not
be penalized. This right, however, must be
exercised in good faith. Absence of good faith
in the present case is shown by the fact that
petitioner clearly has no cause of action
against respondents but it recklessly filed suit
anyway and wantonly pursued pointless
appeals, thereby causing the latter to spend
valuable time, money and effort in
unnecessarily defending themselves, incurring
damages in the process.
Mijares vs. CA (1997): Moral damages cannot be
recovered from a person who has filed a
complaint against another in good faith, or
without malice or bad faith. If damage results
from the filing of the complaint, it is damnum
absque injuria.
Barreto vs. Arevalo (1956): The adverse result of
an action does not per se make the act
wrongful and subject the actor to the payment
of moral damages. The law could not have
meant to impose a penalty on the right to
litigate; such right is so precious that moral
damages may not be charged on those who
may exercise it erroneously.
IN ACTS REFERRED TO IN ARTS. 21, 26,
27, 28, 29, 32, 34 &35, NCC
Art. 21. Any person who
wilfully 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.

Art. 26. Every person

shall respect the
dignity, personality,
privacy and peace of

UP LAW BOC DAMAGES CIVIL LAW

547
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 another's
residence:
(2) Meddling with or
disturbing the private
life or family relations of
another;
(3) Intriguing to cause
another to be
alienated from his
friends;
(4) Vexing or humiliating
another on
account of his religious
beliefs, lowly
station in life, place of
birth, physical
defect, or other personal
condition.

VIOLATION OF HUMAN DIGNITY

Concepcion v CA (1998).The law seeks to
protect a person from being unjustly
humiliated. Using this provision, the SC
awarded moral damages to the plaintiff, a
married man, against the defendant, who
confronted the plaintiff face-to-face, invading
the latters privacy, to hurl defamatory words
at him in the presence of his wife and children,
neighbors and friends, accusing him of having
an adulterous relationship with another
woman.
Art. 27. Any person
suffering material or
moral loss because a
public servant or
employee refuses or
neglects, without just
cause, to perform his
official duty may file an
action for damages and
other relief against
the latter, without
prejudice to any
disciplinary
administrative action
that may
be taken.

REFUSAL OR NEGLECT OF DUTY

Vital-Gozon v CA (1998). Under CC 27, in
relation to CC 2219 and 2217, a public officer
may be liable for moral damages for as long as
the moral damages suffered by [the plaintiff]
were the proximate result of [defendants]
refusal to perform an official duty or neglect in
the performance thereof. In fact, under
Articles 19 and 27 of the Civil Code, a public
official may be made to pay damages for
performing a perfectly legal act, albeit with
bad faith or in violation of the "abuse of right"
doctrine.
Art. 28. Unfair
competition in
agricultural,
commercial or industrial
enterprises or in
labor through the use of
force, intimidation,
deceit, machination or
any other unjust,
oppressive or
highhanded method
shall give
rise to a right of action
by the person who
thereby suffers damage.

Art. 29. When the

accused in a criminal
prosecution is acquitted
on the ground that
his guilt has not been
proved beyond
reasonable doubt, a civil
action for damages
for the same act or
omission may be
instituted. Such action
requires only a
preponderance of
evidence. Upon motion
of
the defendant, the court
may require the
plaintiff to file a bond to
answer for damages
in case the complaint
should be found to be
malicious.
If in a criminal case the
judgment of acquittal
is based upon
reasonable doubt, the
court
shall so declare. In the
absence of any
declaration to that
effect, it may be inferred
from the text of the
decision whether or not
the acquittal is due to
that ground.

Art. 32. Any public

officer or employee, or
any
private individual, who
directly or indirectly
obstructs, defeats,
violates or in any
manner
impedes or impairs any
of the following
rights and liberties of
another person shall
be liable to the latter for
damages:
(1) Freedom of religion;
(2) Freedom of speech;
(3) Freedom to write for
the press or to
maintain a periodical
publication;
(4) Freedom from
arbitrary or illegal
detention;
(5) Freedom of suffrage;
(6) The right against
deprivation of property
without due process of
law;
(7) The right to a just
compensation when
private property is taken
for public use;
UP LAW BOC DAMAGES CIVIL LAW
548
(8) The right to the
equal protection of the
laws;
(9) The right to be
secure in one's person,
house, papers, and
effects against
unreasonable searches
and seizures;
(2) The liberty of abode
and of changing the
same;
(3) The privacy of
communication and
correspondence;
(4) The right to become
a member of
associations or societies
for purposes
not contrary to law;
(5) The right to take part
in a peaceable
assembly to petition the
government for
redress of grievances;
(6) The right to be free
from involuntary
servitude in any form;
(7) The right of the
accused against
excessive bail;
(8) The right of the
accused to be heard by
himself and counsel, to
be informed of
the nature and cause of
the accusation
against him, to have a
speedy and public
trial, to meet the
witnesses face to face,
and to have compulsory
process to
secure the attendance of
witness in his
behalf;
(9) Freedom from being
compelled to be a
witness against one's
self, or from being
forced to confess guilt,
or from being
induced by a promise of
immunity or
reward to make such
confession, except
when the person
confessing becomes a
State witness;
(10) Freedom from
excessive fines, or cruel
and unusual
punishment, unless the
same is imposed or
inflicted in
accordance with a
statute which has not
been judicially declared
unconstitutional; and
(11) Freedom of access
to the courts.
In any of the cases
referred to in this article,
whether or not the
defendant's act or
omission constitutes a
criminal offense, the
aggrieved party has a
right to commence an

entirely separate and

distinct civil action for
damages, and for other
relief. Such civil
action shall proceed
independently of any
criminal prosecution (if
the latter be
instituted), and mat be
proved by a
preponderance of
evidence.
The indemnity shall
include moral damages.
Exemplary damages
may also be
adjudicated.
The responsibility herein
set forth is not
demandable from a
judge unless his act or
omission constitutes a
violation of the Penal
Code or other penal
statute.

VIOLATION OF CIVIL AND POLITICAL

RIGHTS
Conjuangco v CA (1999). The purpose of [CC 32]
is to provide a sanction to the deeply cherished
rights and freedoms enshrined in the
Constitution. Under [CC 32], it is not necessary
that the public officer acted with malice or bad
faith. To be liable, it is enough that there was a
violation of the constitutional rights of
petitioner, even on the pretext of justifiable
motives or good faith in the performance of
one's duties.
Meralco v Spouses Chua (2010). Article 32 of
the Civil Code provides that moral damages
are proper when the rights of individuals,
including the right against deprivation of
property without due process of law, are
violated.
Art. 34. When a member
of a city or
municipal police force
refuses or fails to
render aid or protection
to any person in case
of danger to life or
property, such peace
officer shall be primarily
liable for damages,
and the city or
municipality shall be
subsidiarily responsible
therefor. The civil
action herein recognized
shall be
independent of any
criminal proceedings,
and a preponderance of
evidence shall
suffice to support such
action.
UP LAW BOC DAMAGES CIVIL LAW
549
Art. 35. When a person,
claiming to be
injured by a criminal
offense, charges
another with the same,
for which no
independent civil action
is granted in this
Code or any special law,
but the justice of the
peace finds no
reasonable grounds to
believe
that a crime has been
committed, or the
prosecuting attorney
refuses or fails to
institute criminal
proceedings, the
complaint
may bring a civil action
for damages against
the alleged offender.
Such civil action may
be supported by a
preponderance of
evidence. Upon the
defendant's motion, the
court may require the
plaintiff to file a bond
to indemnify the
defendant in case the
complaint should be
found to be malicious.
If during the pendency
of the civil action, an
information should be
presented by the
prosecuting attorney,
the civil action shall be
suspended until the
termination of the
criminal proceedings.

Please refer to previous discussions on the

provisions.
Art. 2220. Willful injury
to property may be a
legal ground for
awarding moral
damages if
the court should find
that, under the
circumstances, such
damages are justly due.
The same rule applies to
breaches of
contract where the
defendant acted
fraudulently or in bad
faith.

IN WILLFUL INJURY TO PROPERTY

Regala v Carin (2011). To sustain an award of
damages, the damage inflicted upon
[plaintiffs] property must be malicious or
willful, an element crucial to merit an award of
moral damages under Article 2220 of the Civil
Code
IN BREACH OF CONTRACT IN BAD FAITH
Bankard, Inc. v Feliciano (2006). Moral
damages may be recovered in culpa
contractual where the defendant acted in bad
faith or with malice in the breach of the
contract. However, a conscious or intentional
design need not always be present since
negligence may occasionally be so gross as to
amount to malice or bad faith. Bad faith, in the
context of Art. 2220 of the Civil Code,
includes gross negligence. Thus, we have held
in a number of cases that moral damages may
be awarded in culpa contractual or breach of
contract when the defendant acted
fraudulently or in bad faith, or is guilty of gross
negligence amounting to bad faith, or in
wanton disregard of his contractual
obligations.
Sulpicio Lines v Curso (2010). As an exception
[to the requirement of bad faith], moral
damages may be awarded in case of breach of
contract of carriage that results in the death of
a passenger.
WHO MAY RECOVER MORAL
DAMAGES
Art. 2219. Moral
damages may be
recovered
in the following and
analogous cases:
(1) A criminal offense
resulting in physical
injuries;
(2) Quasi-delicts causing
physical injuries;
(3) Seduction,
abduction, rape, or other
lascivious acts;
(4) Adultery or
concubinage;
(5) Illegal or arbitrary
detention or arrest;
(6) Illegal search;
(7) Libel, slander or any
other form of
defamation;
(8) Malicious
prosecution;
(9) Acts mentioned in
article 309;
(10) Acts and actions
referred to in articles 21,
26, 27, 28, 29, 30, 32,
34, and 35.
The parents of the
female seduced,
abducted, raped, or
abused, referred to in
No. 3 of this article, may
also recover moral
damages.
The spouse,
descendants,
ascendants, and

UP LAW BOC DAMAGES CIVIL LAW

550
brothers and sisters may
bring the action
mentioned in No. 9 of
this article, in the order
named.

RELATIVES OF INJURED PERSONS

Sulpicio Lines v Curso (2010). Article 2219
circumscribes the instances in which moral
damages may be awarded. The provision does
not include succession in the collateral line as
a source of the right to recover moral damages.
The usage of the phrase analogous cases in
the provision means simply that the situation
must be held similar to those expressly
enumerated in the law in question
JURIDICAL PERSONS
ABS-CBN vs. CA (1999): The award of moral
damages cannot be granted in favor of a
corporation because, being an artificial person
and having existence only in legal
contemplation, it has no feelings, no emotions,
no senses, It cannot, therefore, experience
physical suffering and mental anguish, which
can be experienced only by one having a
nervous system. The statement in People vs.
Manero and Mambulao Lumber Co. vs. PNB
that a corporation may recover moral damages
if it "has a good reputation that is debased,
resulting in social humiliation" is an obiter
dictum.
FACTORS CONSIDERED IN
DETERMINING AMOUNT
Lopez v Pan American (1966). The amount of
damages awarded in this appeal has been
determined by adequately considering the
official, political, social, and financial standing
of the offended parties on one hand, and the
business and financial position of the offender
on the other. The SC further considered the
present rate of exchange and the terms at
which the amount of damages awarded would
approximately be in U.S. dollars, the
defendant being an international airline.
Senate President Lopez, for his social standing
and prestige, received P100,000; his wife
Maria Lopez received P50,000 for her
discomfort, and the fact that she was already
sick and suffering a flu when she left the
Philippines via defendants plane; and the
Montelibanos received P25,000 each, for
being immediate family members of Senator
Lopez, and as such they likewise shared his
prestige and humiliation.
IV. Nominal Damages
Nominal damages consist in damages
awarded, not for purposes of indemnifying the
plaintiff for any loss suffered, but for the
vindication or recognition of a right violated by
the defendant.
REQUISITES AND CHARACTERISTICS
(1) Invasion or violation of any legal or
property right.
(2) No proof of loss is required.
(3) The award is to vindicate the right
violated.
WHEN AWARDED
Art. 2221. Nominal
damages are
adjudicated
in order that a right of
the plaintiff, which has
been violated or invaded
by the defendant,
may be vindicated or
recognized, and not for
the purpose of
indemnifying the plaintiff
for
any loss suffered by him.

Art. 2222. The court may

award nominal
damages in every
obligation arising from
any
source enumerated in
article 1157, or in every
case where any property
right has been
invaded.

Art. 2223. The

adjudication of nominal
damages shall preclude
further contest upon
the right involved and all
accessory
questions, as between
the parties to the suit,
or their respective heirs
and assigns.

UP LAW BOC DAMAGES CIVIL LAW

551
One does not ask for nominal damages, and it
is in lieu of the actual, moral, temperate, or
liquidated damages.
Nominal damages are incompatible with
actual, temperate and exemplary damages.
Armovit vs. CA (1990): Nominal damages
cannot co-exist with actual or compensatory
damages.
Francisco vs. Ferrer (2001): No moral or
exemplary damages was awarded.
Nevertheless, when confronted with their
failure to deliver on the wedding day the
wedding cake ordered and paid for, petitioners
gave the lame excuse that delivery was
probably delayed because of the traffic, when
in truth, no cake could be delivered because
the order slip got lost. For such prevarication,
petitioners must be held liable for nominal
damages for insensitivity, inadvertence or
inattention to their customer's anxiety and
need of the hour.
Gonzales v PCIB (2011). Nominal damages "are
recoverable where a legal right is technically
violated and must be vindicated against an
invasion that has produced no actual present
loss of any kind. Its award is thus not for the
purpose of indemnification for a loss but for
the recognition and vindication of a
right. When granted by the courts, they are not
treated as an equivalent of a wrong inflicted
but simply a recognition of the existence of a
technical injury. A violation of the plaintiffs
right, even if only technical, is sufficient to
support an award of nominal damages.
Conversely, so long as there is a showing of a
violation of the right of the plaintiff, an award
of nominal damages is proper.
Spouses Guanio v Makati Shangri-la (2011). The
plaintiffs sought to recover damages from the
hotel due to its breach of contract as regards
food service for the plaintiffs guests. The SC
did not award actual and moral damages
because it found that the plaintiffs failure to
inform the hotel regarding the increase of
guests (from 350 expected guests, at
maximum capacity of 380, the number of
guests reached 470) was the proximate cause
of the plaintiffs injury. Nevertheless, the SC
awarded nominal damages under
considerations of equity, for the discomfiture
that the plaintiffs were subjected to during the
event, averring that the hotel could have
managed the "situation" better, it being held
in high esteem in the hotel and service
industry. Given respondents vast experience, it
is safe to presume that this is not its first
encounter with booked events exceeding the
guaranteed cover.
NATURE AND DETERMINATION OF
AMOUNT
Gonzales v People (2007). The assessment of
nominal damages is left to the discretion of the
trial court according to the circumstances of
the case. Generally, nominal damages by their
nature are small sums fixed by the court
without regard to the extent of the harm done
to the injured party. However, it is generally
held that a nominal damage is a substantial
claim, if based upon the violation of a legal
right; in such a case, the law presumes
damage although actual or compensatory
damages are not proven.
V. Temperate Damages
Art. 2224. Temperate or
moderate damages,
which are more than
nominal but less than
compensatory damages,
may be recovered
when the court finds
that some pecuniary
loss has been suffered
but its amount
cannot, from the nature
of the case, be
provided with certainty.

Art. 2225. Temperate

damages must be
reasonable under the
circumstances.

UP LAW BOC DAMAGES CIVIL LAW

552
These damages are awarded for pecuniary
loss, in an amount that, from the nature of the
case, cannot be proved with certainty.
REQUISITES
(1) Actual existence of pecuniary loss
(2) The nature and circumstances of the loss
prevents proof of the exact amount
(3) They are more than nominal and less than
compensatory.
(4) Causal connection between the loss and
the defendants act or omission.
(5) Amount must be reasonable.
Ramos vs. CA (2002): In cases where the
resulting injury might be continuing and
possible future complications directly arising
from the injury, while certain to occur are
difficult to predict, temperate damages can
and should be awarded on top of actual or
compensatory damages; in such cases there is
no incompatibility between actual and
temperate damages as they cover two distinct
phases.
Citytrust Bank vs. IAC(1994): Temperate
damages are incompatible with nominal
damages hence, cannot be granted
concurrently.
Pleno vs. CA(1988): Temperate damages are
included within the context of compensatory
damages.Tan v OMC Carriers (2011). The SC
awarded temperate damages in lieu of actual
damages for loss of earning capacity where
earning capacity is plainly established but no
evidence was presented to support the
allegation of the injured partys actual income.
Republic v Tuvera (2007). Courts are authorized
to award temperate damages even in cases
where the amount of pecuniary loss could have
been proven with certainty, if no such
adequate proof was presented. The allowance
of temperate damages when actual damages
were not adequately proven is ultimately a rule
drawn from equity, the principle affording
relief to those definitely injured who are unable
to prove how definite the injury.
There are cases where from the nature of the
case, definite proof of pecuniary loss cannot be
offered, although the court is convinced that
there has been such loss. For instance, injury to
one's commercial credit or to the goodwill of a
business firm is often hard to show certainty in
terms of money. (NOTE: In this case actual and
temperate damages were awarded. It is
postulated that the actual damages is for the
car while the temperate damages is for the lost
actual income not sufficiently proved.)
FACTORS IN DETERMINING
AMOUNT
De Guzman v Tumolva (2011). The SC awarded
temperate damages where from the nature of
the case, definite proof of pecuniary loss
cannot be adduced, although the court is
convinced that the plaintiff suffered some
pecuniary loss. The SC also increased the
award of temperate damages from P100,000
to P150,000, taking into account the cost of
rebuilding the damaged portions of the
perimeter fence.
WHERE THERE ARE RECEIPTS
PROVIDED AMOUNTING TO LESS THAN
P25,000
People v Lucero (2010). Anent the actual
damages, we note that the CA
awarded P3,000.00 representing the amount
spent for the embalming as shown by the
receipt. However, the prosecution also
presented a list of expenses such as those
spent for the coffin, etc., which were not duly
covered by receipt. If the actual damages,
proven by receipts during the trial, amount to
UP LAW BOC DAMAGES CIVIL LAW
553
less than P25,000.00, the victim shall be
entitled to temperate damages in the amount
of P25,000.00, in lieu of actual damages. In
this case, the victim is entitled to the award
ofP25,000.00 as temperate damages
considering that the amount of actual
damages is only P3,858.50. The amount of
actual damages shall be deleted.
WHERE NO RECEIPTS WERE PROVIDED
People v Gidoc (2009). The award
of P25,000.00 as temperate damages in
homicide or murder cases is proper when no
evidence of burial and funeral expenses is
presented in the trial court.
People v Surongon (2007). Where the amount
of actual damages cannot be determined
because no receipts were presented to prove
the same but it is shown that the heirs are
entitled thereto, temperate damages may be
awarded, fixed atP25,000.00. Considering
that funeral expenses were obviously incurred
by the victims heirs, an award ofP25,000.00
as temperate damages is proper.
VI.Liquidated Damages
Art. 2226. Liquidated
damages are those
agreed upon by the
parties to a contract, to
be paid in case of breach
thereof.

Art. 2227. Liquidated

damages, whether
intended as an
indemnity or a penalty,
shall
be equitably reduced if
they are iniquitous or
unconscionable.

Liquidated damages are those damages

agreed upon by the parties to a contract to be
paid in case of breach thereof.
It differs from a penal clause in that in the
latter case the amount agreed to be paid may
bear no relation to the probable damages
resulting from the breach. Basically, a penalty
is ad terrorem, while liquidated damages are
ad reparationem.
REQUISITES AND CHARACTERISTICS
(1) Liquidated damages must be validly
stipulated.
(2) There is no need to prove the amount of
actual damages.
(3) Breach of the principal contract must be
proved.
RULES GOVERNING BREACH OF
CONTRACT
Art. 2228. When the
breach of the contract
committed by the
defendant is not the one
contemplated by the
parties in agreeing
upon the liquidated
damages, the law shall
determine the measure
of damages, and not
the stipulation.
Suatengco v Reyes (2008). Liquidated damages
are those agreed upon by the parties to a
contract to be paid in case of breach thereof.
The stipulation on attorneys fees contained in
the said Promissory Note constitutes what is
known as a penal clause. A penalty clause,
expressly recognized by law, is an accessory
undertaking to assume greater liability on the
part of the obligor in case of breach of an
obligation. It functions to strengthen the
coercive force of obligation and to provide, in
effect, for what could be the liquidated
damages resulting from such a breach. The
obligor would then be bound to pay the
stipulated indemnity without the necessity of
proof on the existence and on the measure of
damages caused by the breach.
General Rule: The penalty shall substitute the
indemnity for damages and the payment of the
interests in case of breach.
Exceptions
(1) When there is a stipulation to the contrary.
UP LAW BOC DAMAGES CIVIL LAW
554
(2) When the obligor is sued for refusal to pay
the agreed penalty.
(3) When the obligor is guilty of fraud.
The amount can be reduced if:
(1) it is unconscionable as determined by the
court
(2) there is partial or irregular performance.
VII. Exemplary or
Corrective Damages
Art. 2229. Exemplary or
corrective damages
are imposed, by way of
example or correction
for the public good, in
addition to the moral,
temperate, liquidated or
compensatory
damages.

In common law, these damages were termed

punitive.
Canada v All Commodities Marketing (2008).
The grant of temperate damages paves the
way for the award of exemplary damages.
Under Article 2234 of the Civil Code, a showing
that the plaintiff is entitled to temperate
damages allows the award of exemplary
damages.
PNB vs. CA (1996): However, the award of
P1,000,000 exemplary damages is also far too
excessive and should likewise be reduced to an
equitable level. Exemplary damages are
imposed not to enrich one party or impoverish
another but to serve as a deterrent against or
as a negative incentive to curb socially
deleterious actions.
WHEN RECOVERABLE
IN CRIMINAL OFFENSES; NCC ART. 2230
Art. 2230. In criminal
offenses, exemplary
damages as a part of the
civil liability may be
imposed when the crime
was committed with

one or more aggravating

circumstances.
Such damages are
separate and distinct
from fines and shall be
paid to the offended
party.

Award of exemplary damages is part of the

civil liability, not of the penalty.
Damages are paid to the offended party
separately from the fines.
People v Dadulla (2011). Although an
aggravating circumstance not specifically
alleged in the information, albeit established
at trial, cannot be appreciated to increase the
criminal liability of the accused, the
established presence of one or two
aggravating circumstances of any kind or
nature entitles the offended party to exemplary
damages under Article 2230 of the Civil Code
because the requirement of specificity in the
information affected only the criminal liability
of the accused, not his civil liability.
People v Alfredo (2010). Being corrective in
nature, exemplary damages, therefore, can be
awarded, not only in the presence of an
aggravating circumstance, but also where the
circumstances of the case show the highly
reprehensible or outrageous conduct of the
offender. As in this case, where the offender
sexually assaulted a pregnant married woman,
the offender has shown moral corruption,
perversity, and wickedness. He has grievously
wronged the institution of marriage. The
imposition then of exemplary damages by way
of example to deter others from committing
similar acts or for correction for the public
good is warranted in quasi-delicts; NCC Art.
2231
Art. 2231. In quasi-
delicts, exemplary
damages may be
granted if the defendant
acted with gross
negligence.

UP LAW BOC DAMAGES CIVIL LAW

555
Globe Mackay v CA (1989). In this case, the
defendant, the previous employer of the
plaintiff, wrote a letter to the company where
the plaintiff subsequently applied for
employment, stating that the plaintiff was
dismissed by the defendant from work due to
dishonesty, accusing plaintiff of malversation
of defendants funds. Previous police
investigations revealed that the defendants
accusations against the plaintiff were
unfounded, and cleared the plaintiff of such
anomalies. Here, the lower court awarded
exemplary damages to the plaintiff, which the
defendant questioned, averring that CC 2231
may be awarded only for grossly negligent
acts, not for willful or intentional acts. The SC
upheld the grant of exemplary damages,
stating that while CC 2231 provides that for
quasi-delicts, exemplary damages may be
granted if the defendant acted with gross
negligence, with more reason is its imposition
justified when the act performed is deliberate,
malicious and tainted with bad faith.
IN CONTRACTS AND QUASICONTRACTS; NCC ART. 2232
Art. 2232. In contracts
and quasi-contracts,
the court may award
exemplary damages if
the defendant acted in a
wanton, fraudulent,
reckless, oppressive, or
malevolent manner.

REQUISITES
Art. 2233. Exemplary
damages cannot be
recovered as a matter of
right; the court will
decide whether or not
they should be
adjudicated.

Art. 2234. While the

amount of the
exemplary damages
need not be proved, the
plaintiff must show that
he is entitled to
moral, temperate or
compensatory damages
before the court may
consider the question of
whether or not
exemplary damages
should
be awarded. In case
liquidated damages
have been agreed upon,
although no proof of
loss is necessary in
order that such
liquidated
damages may be
recovered, nevertheless,

before the court may

consider the question of
granting exemplary in
addition to the
liquidated damages, the
plaintiff must show
that he would be entitled
to moral,
temperate or
compensatory damages
were it
not for the stipulation for
liquidated
damages.

Art. 2235. A stipulation

whereby exemplary
damages are renounced
in advance shall be
null and void.

REQUISITES TO RECOVER EXEMPLARY

DAMAGES AND LIQUIDATED DAMAGES
AGREED UPON
The plaintiff must show that he/she is entitled
to moral, temperate or compensatory
damages:
If arising When exemplary damages
from are granted
The crime was committed
Art.
Crimes with an aggravating
2230
circumstance/s
Art. Defendant acted with gross
Quasi-delicts
2231 negligence
Defendant acted in a
Contracts
Art. wanton, fraudulent,
and Quasi
2232 reckless, oppressive, or
contracts
malevolent manner

General Principles
(1) Exemplary damages cannot be awarded
alone: they must be awarded IN ADDITION
to moral, temperate, liquidated or
compensatory damages.
(2) The purpose of the award is to deter the
defendant (and others in a similar
condition) from a repetition of the acts for
which exemplary damages were awarded;
hence, they are not recoverable as a matter
of right.
(3) The defendant must be guilty of other
malice or else negligence above the
ordinary.
UP LAW BOC DAMAGES CIVIL LAW
556
(4) Plaintiff is not required to prove the
amount of exemplary damages.
(a) But plaintiff must show that he is
entitled to moral, temperate, or
compensatory damage; that is,
substantial damages, not purely
nominal ones. This requirement
applies even if the contract stipulates
liquidated damages.
(b) The amount of exemplary damage
need not be pleaded in the
complaint because the same cannot
be proved. It is merely incidental or
dependent upon what the court may
award as compensatory damages.
DAMAGES IN CASE OF DEATH
RE. CRIMES AND QUASI-DELICTS
Art. 2206. The amount
of damages for death
caused by a crime or
quasi-delict shall be at
least three thousand
pesos, even though
there may have been
mitigating
circumstances. In
addition:
(1) The defendant shall
be liable for the loss
of the earning capacity
of the deceased,
and the indemnity shall
be paid to the
heirs of the latter; such
indemnity shall
in every case be
assessed and awarded
by the court, unless the
deceased on
account of permanent
physical disability
not caused by the
defendant, had no
earning capacity at the
time of his death;
(2) If the deceased was
obliged to give
support according to the
provisions of
article 291, the recipient
who is not an
heir called to the
decedent's inheritance
by the law of testate or
intestate
succession, may
demand support from
the person causing the
death, for a
period not exceeding
five years, the exact
duration to be fixed by
the court;
(3) The spouse,
legitimate and
illegitimate
descendants and
ascendants of the
deceased may demand
moral damages
for mental anguish by
reason of the

death of the deceased.

IN DEATH CAUSED BY BREACH OF

CONDUCT BY A COMMON CRIME
Heirs of Raymundo Castro vs. Bustos (1969):
when death occurs as a result of a crime, the
heirs of the deceased are entitled to the
following items of damages:
(1) As indemnity for the death of the victim of
the offense P12,000.00, without the
need of any evidence or proof of damages,
and even though there may have been
mitigating circumstances attending the
commission of the offense.
(2) As indemnity for loss of earning capacity of
the deceased an amount to be fixed by
the Court according to the circumstances
of the deceased related to his actual
income at the time of death and his
probable life expectancy, the said
indemnity to be assessed and awarded by
the court as a matter of duty, unless the
deceased had no earning capacity at said
time on account of permanent disability
not caused by the accused. If the deceased
was obliged to give support, under Art.
291, Civil Code, the recipient who is not an
heir, may demand support from the
accused for not more than five years, the
exact duration to be fixed by the court.
(3) As moral damages for mental anguish,
an amount to be fixed by the court. This
may be recovered even by the illegitimate
descendants and ascendants of the
deceased.
(4) As exemplary damages, when the crime is
attended by one or more aggravating
circumstances, an amount to be fixed in
the discretion of the court, the same to be
considered separate from fines.
(5) As attorney's fees and expresses of
litigation, the actual amount thereof,
(but only when a separate civil action to
UP LAW BOC DAMAGES CIVIL LAW
557
recover civil liability has been filed or when
exemplary damages are awarded).
(6) Interests in the proper cases.
(7) It must be emphasized that the
indemnities for loss of earning capacity of
the deceased and for moral damages are
recoverable separately from and in
addition to the fixed sum of P12,000.00
corresponding to the indemnity for the
sole fact of death, and that these damages
may, however, be respectively increased or
lessened according to the mitigating or
aggravating circumstances, except items 1
and 4 above, for obvious reasons.
At present, the SC allows civil indemnity of
Php. 50,000 in cases of homicide (De Villa vs.
People (2012)) and Php. 75,000 in cases of
murder (People v. Camat (2012)).
Sulpicio Lines v Curso (2010). The omission
from Article 2206 (3) of the brothers and
sisters of the deceased passenger reveals the
legislative intent to exclude them from the
recovery of moral damages for mental anguish
by reason of the death of the
deceased. Inclusio unius est exclusio alterius.
VIII. Graduation of
Damages
RULES
IN CRIMES
Art. 2204. In crimes, the
damages to be
adjudicated may be
respectively increased or
lessened according to
the aggravating or
mitigating
circumstances.
IN QUASI-DELICTS
Art. 2214. In quasi-
delicts, the contributory
negligence of the
plaintiff shall reduce the
damages that he may
recover.

CONTRIBUTORY NEGLIGENCE
Genobiagon vs. CA (1989): The alleged
contributory negligence of the victim, if any,
does not exonerate the accused in criminal
cases committed through reckless imprudence,
since one cannot allege the negligence of
another to evade the effects of his own
negligence.
Rakes vs. Atlantic (1907):If so, the disobedience
of the plaintiff in placing himself in danger
contributed in some degree to the injury as a
proximate, although not as its primary cause.
(Supreme Court in this case cited numerous
foreign precedents, mostly leaning towards the
doctrine that contributory negligence on the
part of the plaintiff did not exonerate
defendant from liability, but it led to the
reduction of damages awarded to the plaintiff.)
Cangco vs. Manila Railroad Co. (1918): In
determining the question of contributory
negligence in performing such act that is to
say, whether the passenger acted prudently or
recklessly the age, sex, and physical
condition of the passenger are circumstances
necessarily affecting the safety of the
passenger, and should be considered.
PLAINTIFFS NEGLIGENCE
Manila Electric vs. Remonquillo (1956): Even if
Manila Electric is negligent, in order that it
may be held liable, its negligence must be the
proximate and direct cause of the accident.
Bernardo vs. Legaspi (1914): Both of the parties
contributed to the proximate cause; hence,
they cannot recover from one another.
IN CONTRACTS, QUASI-CONTRACTS
AND QUASI-DELICTS
Art. 2215 In contracts,
quasi-contracts, and
quasi-delicts, the court
may equitably
mitigate the damages
under circumstances

UP LAW BOC DAMAGES CIVIL LAW

558
other than the case
referred to in the
preceding article, as in
the following
instances:
(1) That the plaintiff
himself has
contravened the terms
of the contract;
(2) That the plaintiff has
derived some
benefit as a result of the
contract;
(3) In cases where
exemplary damages are
to be awarded, that the
defendant acted
upon the advice of
counsel;
(4) That the loss would
have resulted in any
event;
(5) That since the filing
of the action, the
defendant has done his
best to lessen
the plaintiff's loss or
injury.

GROUNDS FOR MITIGATION OF

DAMAGES
FOR CONTRACTS:
(1) Violation of terms of the contract by the
plaintiff himself;
(2) Obtention or enjoyment of benefit under
the contract by the plaintiff himself;
(3) Defendant acted upon advice of counsel in
cases where exemplary damages are to be
awarded such as under Articles 2230,
2231, and 2232;
(4) Defendant has done his best to lessen the
plaintiffs injury or loss.
FOR QUASI-CONTRACTS:
(1) In cases where exemplary damages are to
be awarded such as in Art. 2232;
(2) Defendant has done his best to lessen the
plaintiffs injury or loss.
FOR QUASI-DELICTS:
(1) That the loss would have resulted in any
event because of the negligence or
omission of another, and where such
negligence or omission is the immediate
and proximate cause of the damage or
injury;
(2) Defendant has done his best to lessen the
plaintiffs injury or loss.
Sweet Lines v CA (1983). The SC deemed CC
2215(2) inapplicable where the harm done to
private respondents outweighs any benefits
the plaintiffs may have derived from being
transported to Tacloban instead of being taken
to Catbalogan, their destination and the
vessel's first port of call, pursuant to its normal
schedule.
RULE WHEN CONTRACTING PARTIES
ARE IN PARI DELICTO
Generally, parties to a void agreement cannot
expect the aid of the law; the courts leave them
as they are, because they are deemed in pari
delicto or "in equal fault." In pari delicto is "a
universal doctrine which holds that no action
arises, in equity or at law, from an illegal
contract; no suit can be maintained for its
specific performance, or to recover the property
agreed to be sold or delivered, or the money
agreed to be paid, or damages for its violation;
and where the parties are in pari delicto, no
affirmative relief of any kind will be given to
one against the other."
This rule, however, is subject to exceptions that
permit the return of that which may have been
given under a void contract to:
(a) the innocent party (Arts. 1411-1412, Civil
Code);
(b) the debtor who pays usurious interest (Art.
1413, Civil Code);
(c) the party repudiating the void contract
before the illegal purpose is accomplished
or before damage is caused to a third
person and if public interest is subserved
by allowing recovery (Art. 1414, Civil
Code);
(d) the incapacitated party if the interest of
justice so demands (Art. 1415, Civil Code);
(e) the party for whose protection the
prohibition by law is intended if the
UP LAW BOC DAMAGES CIVIL LAW
559
agreement is not illegal per se but merely
prohibited and if public policy would be
enhanced by permitting recovery (Art.
1416, Civil Code); and
(f) the party for whose benefit the law has
been intended such as in price ceiling laws
(Art. 1417, Civil Code) and labor laws (Arts.
1418-1419, Civil Code).
LIQUIDATED DAMAGES
Art. 2227. Liquidated
damages, whether
intended as an
indemnity or a penalty,
shall
be equitably reduced if
they are iniquitous or
unconscionable.

COMPROMISE
Art. 2031. The courts
may mitigate the
damages to be paid by
the losing party who
has shown a sincere
desire for a compromise.

IX.Miscellaneous Rules
DAMAGES THAT CANNOT CO-EXIST
NOMINAL WITH OTHER DAMAGES
Art. 2223. The
adjudication of nominal
damages shall preclude
further contest upon
the right involved and all
accessory
questions, as between
the parties to the suit,
or their respective heirs
and assigns.

Vda. De Medina vs. Cresencia (1956): The

propriety of the damages awarded has not
been questioned, Nevertheless, it is patent
upon the record that the award of P10,000 by
way of nominal damages is untenable as a
matter of law, since nominal damages cannot
co-exist with compensatory damages.
The purpose of nominal damages is to
vindicate or recognize a right that has been
violated, in order to preclude further contest
thereon; and not for the purpose of
indemnifying the Plaintiff for any loss suffered
by him (Articles 2221, 2223, new Civil Code.)
Since the court below has already awarded
compensatory and exemplary damages that
are in themselves a judicial recognition that
Plaintiffs right was violated, the award of
nominal damages is unnecessary and
improper. Anyway, ten thousand pesos cannot,
in common sense, be deemed nominal.
ACTUAL AND LIQUIDATED
Art. 2226. Liquidated
damages are those
agreed upon by the
parties to a contract, to
be paid in case of breach
thereof.

DAMAGES THAT MUST CO-EXIST

EXEMPLARY WITH MORAL, TEMPERATE,
LIQUIDATED OR COMPENSATORY
Francisco vs. GSIS (1963): There is no basis for
awarding exemplary damages either, because
this species of damages is only allowed in
addition to moral, temperate, liquidated, or
compensatory damages, none of which have
been allowed in this case, for reasons herein
before discussed.
Scott Consultants & Resource Development
Corp. vs. CA (1995): There was, therefore, no
legal basis for the award of exemplary
damages since the private respondent was not
entitled to moral, temperate, or compensatory
damages and there was no agreement on
stipulated damages.
DAMAGES THAT MUST STAND
ALONE
NOMINAL DAMAGES
Art. 2223. The
adjudication of nominal
damages shall preclude
further contest upon
the right involved and all
accessory
questions, as between
the parties to the suit,
or their respective heirs
and assigns.

UP LAW BOC DAMAGES CIVIL LAW

560

CIVIL LAW
PRIVATE
INTERNATIONAL
LAW
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
561

I. Introduction
A.SCOPE OF CONFLICTS OF LAWS:
NATURE, DEFINITION AND
IMPORTANCE
A.2. DIVERSITY OF LAWS, CUSTOMS
AND PRACTICES
No law has any effect, of its own force, beyond
the limits of the sovereignty from which its
authority is derived. The extent to which the
law of one nation, as put in force within its
territory, whether by executive order, by
legislative act, or by judicial decree, shall be
allowed to operate within the dominion of
another nation, depends upon what our
greatest jurists have been content to call the
comity of nations.
Comity, in the legal sense, is neither a matter
of absolute obligation, on the one hand, nor of
mere courtesy and good will, upon the other.
But it is the recognition which one nation
allows within its territory to the legislative,
executive or judicial acts of another nation,
having due regard both to international duty
and convenience, and to the rights of its own
citizens or of other persons who are under the
protection of its laws... [Hilton v Guyot, 159 US
113, 1895]
A.2. DEFINITION
Private international law
That part of municipal law which governs
cases involving a foreign element.
Those universal principles of right and
justice which govern the operation and
effect of laws of another state or country.
That part of law which comes into play
when the issue before the court affects
some fact or event, or transaction that is so
closely connected with a foreign system of
law as to necessitate recourse to that
system.
That part of the law of each state or nation
which determines whether, in dealing with
a legal situation, the law of some other
state or nation will be recognized, given
effect, or applied.
The law concerning the rights of persons
within the territory and dominion of one
nation by reason of acts, private or public,
done within the dominion of another
nation.
A.3. OBJECT, FUNCTION AND SCOPE
The object and function of conflict of laws is to
provide rational and valid rules or guidelines in
deciding cases where either the parties, events
or transactions are linked to more than one
jurisdiction.
i. Scope
Adjudicatory jurisdiction
o Determines the circumstances
that allow for a legal order to
impose upon its judiciary the
task of deciding multi-state and
multinational disputes
Choice-of-law
o Refers to the probable sources
from which the applicable law
of the controversy may be
derived.
Recognition and enforcement of
foreign judgments
o Deals with the study of
situations which justify
recognition by the forum court
of a judgment rendered by a
foreign court or the enforcement
of such within the forum.
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
562

II. Jurisdiction and

Choice of Law
A. JURISDICTION
Judicial Jurisdiction power or authority of
a court to try a case, render judgment and
execute it in accordance with law
Legislative Jurisdiction the ability of the
state to promulgate laws and enforce them
on all persons and property within its
territory.
A.1. BASIS OF EXERCISE OF JUDICIAL
JURISDICTION
i. Jurisdiction over the Person
Jurisdiction over the person is acquired
by the voluntary appearance of a party
and his submission to authority.
Over the person of the PLAINTIFF the
moment he invokes the aid of the court
by filing a suit.
Over the person of the defendant
when he enters his appearance OR is
served with the legal process within the
state (either through personal or
substituted service of summons).
o Exception: if he appears for the
purpose of protesting the
jurisdiction of the court.
Non-resident plaintiff deemed to
consent to the courts exercise of
jurisdiction over subsequent
proceedings arising out of his original
cause of action including counterclaims
filed by the defendant.
Traditional Approach Presence in the
state
Modern Approach Minimum contacts
and fundamental fairness test
[International Shoe Co. v. Washington, 326
US 310, 1945]
o Minimum Contacts this includes
its presence in the state through
acts of authorized agents.
[International Shoe Co. v.
Washington]
Under International
Shoe, minimum contacts
must exist between the
forum and the
defendant.
Under the case of
Shaffer v Heitner (433
US 186, 1977), the
minimum contacts must
exist among the forum,
defendant and the cause
of action.
ii. Jurisdiction over the Property
Results either from the seizure of the
property under a legal process or from
the institution of legal proceedings
wherein the courts power over the
property is recognized and made
effective.
iii. Jurisdiction over the Subject Matter
Subject matter jurisdiction or competence
is more than the general power conferred
by law to take cognizance of cases of a
general class to which the case belongs.
It is necessary that said power be properly
invoked... by filing a petition.
Subject matter jurisdiction cannot be
conferred by consent of the parties and a
decision is void and may be set aside either
directly or collaterally, where the court
exceeds its jurisdiction and power in
rendering it.
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
563
A.2. WAYS OF DEALING WITH A
CONFLICTS PROBLEM
i. Dismiss the Case
Doctrine of Forum Non Conveniens
Definition: Even if the court
assumes jurisdiction over the
parties and the subject matter, it
may decline to try the case on the
ground that the controversy may
be more suitably tried elsewhere.
ii. Assume Jurisdiction
Assumption of jurisdiction DOES NOT mean
that the court will apply forum law.
However, the presence of any one of the
following factors would justify the application
of internal law:
(1) A specific law of the forum decrees
that internal law should apply
Examples:
(a) Article 16 of the Civil Code real
and personal property are
subject to the law of the country
where they are situated.
(b) Article 829 revocation of a will
done outside the Philippines
maybe valid if done according to
the law of the place where the
will was made or lex domicile
(c) Article 819 prohibits Filipinos
from making joint wills even
when done abroad.
(2) The proper foreign law was not
properly pleaded and proved
(a) Foreign law must be proved as a
fact through Rules of evidence
(e.g. official publication or copy,
which has been consularized)
(b) Doctrine of Processual
Presumption absent contrary
proof, foreign law is presumed
to be the same as Philippine
law.
(3) The case under any of the exceptions to
the application of foreign law.
(a) When the foreign law is contrary
to an important public policy
(b) When the foreign law is penal in
nature
(c) When the foreign law is
procedural in nature
(d) When the foreign law is purely
fiscal or administrative in nature
(e) When the application of the
foreign law will work undeniable
injustice to the citizens of the
forum
(f) When the case involves real or
personal property situated in
the forum
(g) When the application of the
foreign law might endanger the
vital interest of the state.
(h) When the foreign law is contrary
to good morals
B. CHOICE OF LAW
B.1. APPROACHES TO CHOICE OF LAW
i. Traditional Approaches
Vested-Rights Theory
An act done in a foreign jurisdiction
gives rise to the existence of a right if
the laws of that state provides so.
This right vests in the plaintiff and he
carries it with him to be enforced in any
forum he chooses to bring suit.
The forum refers to the law of the place
of occurrence of the last act
necessary to complete the cause of
action.
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
564
ii. Modern Approaches
Place of Most Significant Relationship
Identifies a plurality of factors
o The needs of the interstate and
international system
o Relevant policies of the
concerned states
o The relevant policies of other
interested states and the
relative interests of those in the
determination of the particular
issue
o The protection of justified
expectations of the parties
o The basic policies underlying
the particular field of law
o Certainty, predictability and
uniformity of result
o Ease in the determination and
the application of the law to be
applied
In torts
o The place where the injury
occurred
o The place where the negligent
conduct occurred
o The domicile, resident or
nationality of the parties
o The place where the
relationship between the parties
is entered.
In contracts
o The law chosen by the parties
o In the absence thereof;
the place of contracting
the place of negotiation
the place of performance
the domicile, residence,
nationality, place of
incorporation and place
of business of the parties
Interest Analysis
Looks at the policy behind the laws
of the involved state and the
interest each state had in applying
its own law.
Comparative Impairment
Weighs conflicting interests and
apply the law of the state whose
interest would be more impaired if
its laws were not followed.
Functional Analysis
This approach looked into the
general policies of the state beyond
those reflected in its substantive
law and to policies and values
relating to effective and
harmonious intercourse between
states.
C. THE PROBLEM OF
CHARACTERIZATION
C.1 CHARACTERIZATION AND THE
SINGLE-ASPECT METHOD
Traditional approach - Single-aspect
method (concentrates on one element
of a situation in order to connect the
case to a particular legal community)
Modern approach Multi-aspect
method (all important factors of the
case are analyzed and the applicable
law is arrived at by rationally
elaborating and applying the policies
and purposes underlying the particular
legal rules that come in question as
well as the needs of interstate or
international intercourse.)
The Philippines follows the single
aspect method.
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
565
Characterization - The process by
which a court at the beginning of the
choice-of-law process assigns a
disputed question to an area in
substantive law.
i. Subject-Matter Characterization
Classification by a court of a factual
situation into a legal category.
ii. Substance-Procedure Dichotomy
Directs the court to the extent it will
apply foreign law.
If the issue is substantive, the court
MAY apply foreign law. But if it
procedural, it is suppose to follow the
law of the forum.
Statute of Frauds
The Statute of Frauds is considered as
substantive if the words of the law
relate to forbidding the CREATION of
obligation.
In contrast, one that forbids
ENFORCEMENT of the obligation is
categorized as procedural.
Statutes of Limitation and Borrowing Statute
General Rule: Statutes of limitations were
classified as procedural because they barred
only the legal remedy without impairing the
substantive right involved.
Exception: If the statute provides a shorter
period for certain types of claims that fall
within a wider classification covered by a
general statute of limitations. (Specificity
Test)
Borrowing statutes
Bars the filing of a suit in the forum if it
is already barred by the statute of
limitations in the place where the cause
of action arose. (Philippines has passed
a borrowing statute)
C.2 DECEPAGE
Phenomenon where different aspects of a
case involving a foreign element may be
governed by different systems of laws.
A case may be dissected into different
issues, each analyzed as to which law
shall apply.
When such issue by issue analysis
results in the application of different
laws to different issues, then decepage
occurs.
Decepage is the effect of issue by issue
analysis.
D. THE PROBLEM OF RENVOI
D.1. DEFINITION
Procedure whereby a jural matter presented is
referred by the conflict of laws rules of the
forum to a foreign state, the conflict of laws
rule of which, in turn, refers the matter to the
law of the forum or a third state.
Remission reference is made back to the
law of the forum
Transmission reference is made to a third
state
D.2. VARIOUS WAYS OF DEALING WITH
THE PROBLEM OF RENVOI
(1) Reject the renvoi - Forum conflict rules is
deemed to refer only to the internal law of
that state (i.e. that which would apply to a
domestic case with no conflict-of-laws
complications)
(2) Accept the renvoi looks into not just the
internal law of the foreign state, but also
the choice-of-law rules applicable in multistate cases.
(3) Desistance or mutual disclaimer of
jurisdiction (e.g. Forum court looks at
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
566
foreign law; foreign law does not apply to
non-residents; therefore, no one has
applicable laws; Forum court then applies
forum law)
(4) Foreign Court Theory the forum court
would assume the same position that the
foreign court would take were the case
litigated in the foreign court.
E. NOTICE AND PROOF OF FOREIGN
LAW
E.1. EXTENT OF JUDICIAL NOTICE
The party whose cause of action or defense
depended upon the foreign law has the
burden of proving the foreign law.
Such foreign law is treated as a question of
fact to be properly pleaded and proved in
conformity with the law of evidence of the
state where it is presented.
A judge is not authorized to take judicial
notice of a foreign law and is presumed to
know only domestic law.
E.2. PROOF OF FOREIGN LAW
Methods to prove foreign law
Official publication of the law (and
consularized)
Copy of the law attested by the
officer having the legal custody of
the record or by his deputy. (and
consularized)
Expert witness
Effect of Failure to Plead and Prove Foreign
Law
Dismiss the case for inability to
establish a cause of action
Assume that the foreign law is the
same as the law of the forum (doctrine
of processual presumption)
Apply the law of the forum
E.3. EXCEPTIONS TO THE APPLICATION
OF FOREIGN LAW
The foreign law is contrary to an
important public policy of the forum
The foreign law is procedural in nature
Issues are related to property (Lex
Situs)
The issue involved in the enforcement
of foreign claim is fiscal or
administrative
The foreign law or judgment is contrary
to good morals (Contra Bonos Mores)
The application of foreign law will work
undeniable injustice to the citizens of
the forum
The foreign law is penal in character
The application of the foreign law
might endanger the vital interests of
the state

III. Personal Law

A. NATIONALITY
A.1. IMPORTANCE OF A PERSONAL LAW
An individuals personal law follows him
wherever he is and governs those transactions
which affect him most closely.
Importance of Nationality in the Philippines
Regulates
Civil status
Capacity
Condition
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
567
Family rights and duties
Laws on succession
Capacity to succeed
A.2. DETERMINATION OF NATIONALITY
Who are Filipino Citizens
Those who are citizens of the
Philippines at the time of the adoption
of the Constitution (1987)
Those whose fathers or mothers are
citizens of the Philippines
Those born before January 17, 1973 of
Filipino mothers, who elect Philippine
citizenship upon reaching the age of
majority
Those who are naturalized in
accordance with law
i. Natural-Born Citizens
Natural-born citizens are those who are
citizens of the Philippines without
having to perform any act to acquire or
perfect citizenship.
The Philippines follows the jus sanguinis
principle which means the rule of descent
or blood.
ii. Citizens by Naturalization
B. DOMICILE
B.1. DEFINITION
Domicile is defined by municipal law
(Philippine Law) and private international law.
Under municipal law
Art. 50 of the Civil Code provides: For
the exercise of civil rights and the
fulfillment of civil obligations, the
domicile of natural persons is the place
of their habitual residence.
For juridical persons: domicile is
determined by the law creating or
recognizing it. In the absence thereof it
shall be understood to be the place
where their legal representation or
place of business is.
Under private international law
The place with which a person has a
settled connection for certain legal
purposes, either because his home is
there or because that place is assigned
to him by law.
The place of his true, fixed permanent
home and principal establishment, and
to which, whenever he is absent, he has
the intention of returning.
To acquire a domicile, there must be
concurrence of intention to make it
ones domicile and physical presence.
B.2. GENERAL RULES ON DOMICILE
Rules on Domicile
(1) No person shall be without a domicile
(2) A person cannot have two
simultaneous domicile.
(a) However, domicile may vary
depending on the purpose (e.g.
domicile for divorce will be different
from domicile for the purpose of
running for public office.)
(3) It establishes a connection between a
person and a particular territorial unit
(4) The burden of proving a change of
domicile is upon whoever alleges that a
change has been secured.
(a) Without overwhelming evidence to
show a change of domicile, the
court will decide in favor of the
continuance of an existing domicile.
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
568
B.3. KINDS OF DOMICILE
Domicile of origin
o Refers to a persons domicile at
birth (domicile of parents)
Domicile of choice
o Voluntary domicile
o The place freely chosen by a
person sui juris
Constructive domicile
o By operation of law, a domicile
is assigned to a person legally
incapable of choosing their own
domicile. (e.g. minors and
mentally disabled)
C. PRINCIPLES ON PERSONAL
STATUS AND CAPACITY
C.1. DEFINITION
Personal status
Includes both condition and capacity
Embraces such matters as:
(1) The beginning and end of human
personality
(2) Capacity to have rights in general
(3) Capacity to engage in legal
transactions
(4) Protection of personal interests
(5) Family relations, particularly the
relations between:
(a) Husband and wife
(b) Parent and child
(c) Guardian and ward
(6) Transactions of family law,
especially
(a) Marriage
(b) Divorce
(c) Separation
(d) Adoption
(e) Legitimation
(f) Emancipation
(7) Succession (both testate and
intestate)
Capacity
Juridical capacity the fitness of a man to
be the subject of legal relations.
Capacity to act the power to do acts with
juridical effects.
The union of both produces complete
civil capacity.
C.2. LEGISLATIVE JURISDICTION
DISTINGUISHED FROM JUDICIAL
JURISDICTION
Status, once established by the personal law of
the party, is given UNIVERSAL RECOGNITION.
C.3. BEGINNING AND END OF
PERSONALITY
The determination of the exact
moment personality begins is referred
to the individuals personal law.
A declaration of death issued by a
competent court is considered valid for
all purposes. Upon the death of a
person, some of his rights and
obligations are totally extinguished
while others are passed on to his
successors.
C.4. ABSENCE
Three ways of addressing conflict of laws
problem regarding absence:
(1) There is a rebuttable presumption that a
person is dead when he has been absent
for a number of years
(2) A persons unexplained absence is
judicially investigated and established
which results in legal effects similar to
those of death
(3) A judicial decree shall have to be issued
declaring the person dead before the legal
effects of death take place.
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
569
The Philippines follows the first.
C.5. NAME
Philippine law provides that: no person can
change his name or surname without judicial
authority.
Exceptions (according to Jurisprudence):
(1) That the name is ridiculous or tainted with
dishonor or extremely difficult to
pronounce.
(2) When the change is necessary to avoid
confusion
(3) When the right to a new name is a
consequence of a change in status
(4) A sincere desire to adopt a Filipino name to
erase signs of a former alien nationality
which unduly hamper social and business
life.
Whether an aliens change of name is valid
DEPENDS SOLELY ON HIS PERSONAL LAW.
C.6. AGE OF MAJORITY
Age of majority is determined by the
individuals personal law.
C.7. CAPACITY
Capacity to act is governed by his personal
law.
The incapacities attached to his legal
status go with him wherever he is.

IV. Choice of Law

Problems
A. CHOICE-OF-LAW IN FAMILY
RELATIONS
A.1. MARRIAGE
This follows the principle of LEX NATIONALII.
i. Philippine Policy on Marriage and the Family
In case of doubt, courts will apply FORUM law
because of marriage is greatly influenced by
the values of society. (Prof. Elizabeth
Pangalangan)
This policy is expressed in various laws, e.g.:
Laws relating to family rights and duties, or
to the status, condition and legal capacity
of persons are binding upon citizens of the
Philippines, even though living abroad. [ Art.
15, Civil Code
]
Marriage, as an inviolable social institution,
is the foundation of the family and shall be
protected by the State. [Sec. 2, Art. XV of the
1987 Constitution]
Marriage is a special contract of permanent
union between a man and a woman entered
into in accordance with law for the
establishment of conjugal and family life. It
is the foundation of the family and an
inviolable social institution whose nature,
consequences, and incidents are governed
by law and not subject to stipulation, except
that marriage settlements may fix the
property relations during the marriage
within limits provided by this Code. [Art. 1,
Family Code]
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
570
ii. Extrinsic Validity of Marriage
Extrinsic validity covers questions relating to
formalities or external conduct required of the
parties or of third persons especially of public
officers, necessary to the formation of a legally
valid marriage.
In the Philippines, these are enumerated in Art
3 of the Family Code:
(1) Authority of the solemnizing officer
(2) A valid marriage license except in cases
provided in Chapter 2 of this Title; and
(3) A marriage ceremony which takes
place with the appearance of the
contracting parties before the
solemnizing officer and their personal
declaration that they take each other as
husband and wife in the presence of
not less than two witnesses of legal
age.
This follows the principle of lex loci
celebrationis.
Exceptions to the rule of lex loci celebrationis
(these involve the question capacity to marry,
which is a substantive requirement for
marriage):
(1) Either/both parties are below 18 years
old
(2) Bigamous or polygamous marriages
(3) Subsequent marriage without
recording:
(a) The judgment of nullity of the first
marriage
(b) Partition and distribution of the
properties of the spouses
(c) Delivery of the childrens
presumptive legitimes
(4) Mistake as to identity of the contracting
party
(5) One of the parties was psychologically
incapacitated to comply with the
essential marital obligations
(6) Incestuous
(7) Void by reason of public policy
iii. Intrinsic Validity of Marriage
Intrinsic validity refers to the general
ability of a person to marry (e.g. age
requirement and parental consent).
This is controlled by the parties
personal laws.
Marriages celebrated by a Consular
Official - Formal and intrinsic
requirements under Philippine law
shall be followed.
iv. Effects of Marriage
Personal Relations Between the Spouses
Includes mutual fidelity, respect,
cohabitation, support and the right of
the wife to use the husbands family
name.
In case of doubt, all presumptions favour
the solidarity of the family. Thus, every
intendment of law or facts leans toward the
validity of marriage, the indissolubility of
the marriage bonds, the legitimacy of
children, the community of property during
the marriage, the authority of parents over
their children, and the validity of defense for
any member of the family in case of
unlawful aggression. [Art. 220, Civil Code]
All marriages solemnized outside the
Philippines in accordance with the laws in
force in the country where they were
solemnized, and valid there as such, shall
also be valid in this country... [Art. 26, par. 1,
Family Code]
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
571
Governed by the national law of the
parties.
Property Relations of Spouses
According to the Hague Convention:
Internal law designated by the spouses
before the marriage
In absence thereof, the internal law of
the state in which both spouses fix their
habitual residence.
At least one Filipino spouse;
Property relations governed by
Philippine law
A.2. DIVORCE AND SEPARATION
Absolute termination of legal
relationship between spouses by an act
of law
Limited separation from bed and
board
Grounds for divorce and dictated by the
LEX FORI.
i. Divorce Decrees Obtained by Filipinos
Decrees of absolute divorce are not
valid if obtained by Filipinos abroad
If decree is obtained by alien spouse
capacitating him to marry, Filipino
spouse shall have capacity to marry.
(Art. 26, Family Code)
ii. Validity of Foreign Divorce Between
Foreigners
This will be recognized in the
Philippines under the principle of
international comity, provided it does
not violate a strongly held policy of the
Philippines.
A.3. ANNULMENT AND DECLARATION
OF NULLITY
Grounds are based on the defects at
the time of the celebration of the
marriage
Traditional approach: Grounds follow
LEX LOCI CELEBRATIONIS
Modern Approach: Grounds follow
LAW OF THE MARITAL DOMICILE.
A.4. PARENTAL RELATIONS
Legitimacy of the child is submitted to
the personal law of the parents (in the
Philippines, national law of the
parents).
i. Determination of Legitimacy of a Child
Kinds of filiations
(1) Natural
(a) Legitimate governed by the
personal law of the father
(b) Illegitimate governed by the
personal law of the mother
(2) Adopted
ii. Parental Authority over the Child
Most countries follow the personal law
of the father.
In the Philippines, joint exercise of
parental authority by the father and
mother (Art. 211 of the Family Code).
A.5. ADOPTION
Process of adoption - governed by LEX
DOMICILII
B. CHOICE OF LAW IN PROPERTY
B.1. THE CONTROLLING LAW
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
572
In the Philippines, both movables and
immovables are governed by LEX
SITAE
Conflict arises when property is located
in a foreign country and the foreign
country has a law that distinguishes
between real and personal property.
B.2. CAPACITY TO TRANSFER OR
ACQUIRE PROPERTY
Real property law of the place where
the property is located
B.3. EXTRINSIC AND INTRINSIC
VALIDITY OF CONVEYANCES
Formalities and effects of conveyance
Governed by lex situs
B.4. EXCEPTION TO LEX SITUS RULE
The transaction does not affect transfer
of title to/ownership of the land (lex
intentionis/lex voluntatis)
Contracts where real property is offered
by way of a security for the
performance of an obligation such as a
loan. (loan is covered by rules on
ordinary contracts though mortgage is
governed by lex situs)
Testate or intestate succession and
capacity to succeed (lex nationalii)
B.5. SITUS OF CERTAIN PROPERTIES
i. Situs of Personal Property for Tax Purposes
Mobilia sequuntur personam
However, it yields to established facts
of legal ownership, actual presence
and control elsewhere and cannot be
applied if it would result in inescapable
and patent injustice.
ii. Situs of Debts
Unsettled in Philippine jurisdiction,
however, Prof. Pangalangan suggests
that the law which governs the contract
from which the debt arises shall also
govern the transfer of the debt.
C. CHOICE OF LAW IN CONTRACTS
C.1. EXTRINSIC VALIDITY OF CONTRACTS
LEX LOCI CELEBRATIONIS (Art. 17 of
the Civil Code)
C.2. INTRINSIC VALIDITY OF CONTRACTS
i. Lex Loci Contractus
Looks into where the last act is done
which is necessary to bring the binding
agreement into being so far as the acts
of the parties are concerned.
ii. Lex Loci Solutionis
All matters relating to the:
(1) Time
(2) Place and manner of performance
(3) Sufficiency of performance
(4) Valid excuses for non performance
iii. Lex Loci Intentionis
Philippine basis
Hence, LEX LOCI INTENTIONIS applies
unless it is contrary to law, morals, good
customs, public order or public policy of
the Philippines.
The contracting parties may establish such
stipulations, clauses, terms and conditions
as they may deem convenient, provided
they are not contrary to law, morals, good
customs, public order, or public policy. [Art.
1306, Civil Code
]
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
573
C.3. CAPACITY TO ENTER INTO
CONTRACTS
Governed by the personal law of the
parties (either LEX NATIONALII or LEX
DOMICILII)
C.4. CHOICE OF LAW ISSUES IN
CONFLICTS CONTRACTS CASES
i. Choice of Forum Clause
Questions of venue, not jurisdiction
Includes arbitration, not only choice of
court.
ii. Contracts with Arbitration Clause
Arbitration clause a provision in a
contract stipulating that any dispute
arising from the contract shall be
submitted to a particular body for
arbitration
C.5. ADHESION CONTRACTS
Adhesion contracts
Not negotiated by the parties
Drafted by only one dominant party
The only participation of the other party
would be to affix his signature
D. CHOICE OF LAW IN WILLS,
SUCCESSION AND ADMINISTRATION
OF ESTATES
D.1. EXTRINSIC VALIDITY OF WILLS
Filipino nationals
Lex nationalii
Lex loci celebrationis
Aliens
Lex nationalii
Lex domicilii
Lex loci celebrationis
D.2. INTRINSIC VALIDITY OF WILLS
Governed by the national law of the
decedent (Art. 16 of the Civil Code)
D.3. INTERPRETATION OF WILLS
Governed by the national law of the
decedent (Art. 16 of the Civil Code)
D.4. REVOCATION
i. Done outside the Philippines, by a person not
have domicile in the Philippines
Lex loci celebrationis
Lex domicilii
ii. Done outside the Philippines, by a person
domiciled in the Philippines
Lex domicilii
Lex loci actus
D.5. PROBATE
Disallowance is essentially procedural
in character governed by the law of
the forum
However, the court will look into the
law of the foreign state where the will
was made as to whether the extrinsic
requirements in the execution of the
will have been complied with.
D.6. ADMINISTRATION OF ESTATES
Nationality and domicile does not
affect administration
Authority of the administrator or
executor is limited to the authority of
the court that appointed such.
E. CHOICE OF LAW IN TORTS AND
CRIMES
E.1. LEX LOCI DELICTI COMMISSI
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
574
Law of the place where the alleged tort
was committed
Choice-of-Law
o Common Law vested rights
theory (place of injury)
o Civil Law Tortious conduct
Traditional View on Jurisdiction an
actor liable by LEX LOCI DELICTI is
liable everywhere
E.2. MODERN THEORIES ON FOREIGN
TORT LIABILITY
i. The Most Significant Relationship
Considers the states contacts with the
occurrence and the parties.
ii. Interest Analysis
Considers the relevant concerns the
state may have in the case and its
interest in having its law applied on
that issue.
iii. Cavers Principle of Preference
Considers justice and social expediency
E.3. FOREIGN TORT CLAIMS
Tortious liability is transitory - the liability
resulting from the conduct is deemed
personal to the perpetrator of the wrong,
following him whithersoever he may go, so
that compensations may be exacted from
him in any proper tribunal which may
obtain jurisdiction of the defendants
person, the right to sue not being confined
to the place where the cause of action
arises.
E.4. DISTINGUISHING BETWEEN TORTS
AND CRIMES
Crime is territorial
Crime is an injury to the state
Since the crime is an affront against
the sovereignty and good order of the
state within whose jurisdiction it
occurs, each state must attend to the
vindication of its own sovereignty.
E.5. LEX LOCI DELICTI
Law of the place where the crime was
committed
An act is punishable if it has been
made punishable as a crime by law.
Developments in public international
law now includes acts considered as a
crime under international law.
Exceptions to lex loci delicti:
(1) Crimes committed by state officials,
diplomatic representatives and officials
of recognized international
organizations
(2) Crimes committed on board foreign
vessels even if it is within the territorial
waters of the coastal state, except: (Art.
27 of UNCLOS)
(a) Consequences extends to the
coastal state
(b) Disturbs the peace or good order of
the country
(c) Requested by the master of the ship
or diplomatic agent or consular
officer of the flag state
(d) If such measures are necessary for
the suppression of illicit traffic in
narcotic drugs or psychotropic
substances.
(3) Crimes committed by Philippine
nationals abroad under Art. 2 of the
RPC.
(a) On a Philippine ship or airship
(b) Forgery or counterfeit any coin or
currency note of the Philippine
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
575
Islands or obligations and securities
issued by the Government of the
Philippine Islands
(c) Introduction of those mentioned
above into the Philippines
(d) Public officers or employees
committing an offense in the
exercise of their functions
(e) Crimes against national security
and the law of nations, defined in
Title One of Book Two of the RPC.
F. CHOICE OF LAW AFFECTING
CORPORATIONS AND OTHER
JURIDICAL ENTITIES
F.1. CORPORATIONS
i. Personal law of a Corporation
Law of the state where it is
incorporated
ii. Exceptions to the Rule of Incorporation Test
Constitutional and Statutory Restrictions
A state may exclude a foreign
corporation from doing business within
its territory, or prescribe any conditions
as a prerequisite.
Control Test During War
Courts may pierce the veil of corporate
identity and look into the nationality of
the controlling stockholders to
determine the citizenship of the
corporation
iii. Domicile or Residence of Foreign
Corporations
Art. 51 of the Civil Code states:
When the law creating or recognizing them, or
any other provision does not fix the domicile of
juridical persons
the place where their legal
representation is established or
where they exercise their principal
functions
A foreign corporation is granted a license to
operate in the Philippines, it acquires domicile
here.
iv. Jurisdiction over Foreign Corporations
A foreign corporation shall be
recognized and allowed to transact
business in any state which gives its
consent.
Foreign corporations doing business in
the Philippines are bound by Philippine
law. (Sec. 129 of the Corporation Code),
except for
(1) Provisions for creation, formation,
organization or dissolution
(2) Provisions which fix the relations
liabilities, responsibilities or duties
of stockholders, members, or
officers of the corporation
(3) Service upon foreign corporations
doing business in the Philippines
may be made on
(a) Resident agent
(b) If none:
(i) Government official
designated by law
(ii) Any of its officers or
(iii) Agent within the Philippines
(iv) Through diplomatic
channels
v. Right of Foreign Corporation to Bring Suit
Prerequisite for filing a suit before
Philippine courts:
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
576
o License to transact business in
the Philippines (Sec. 133 of the
Corporation Code)
vi. Exceptions to the License Requirement
Isolated Transactions
(1) One which is occasional, incidental and
casual
(2) Not of a character or business to
indicate a purpose to engage in
business
(3) Does not constitute doing business
as contemplated by law
(4) Isolated if there is no:
(a) Continuity of conduct
(b) Intention to establish a continuous
business within the state
Action to Protect Trademark, Trade Name,
Goodwill, Patent or for Unfair Competition
Based on equity considerations
Agreements Fully Transacted Outside the
Philippines
Based on the policy of stabilizing
commercial transactions.
Petition Filed is Merely a Corollary Defense in a
Suit Against It
vii. Definition and Scope of Transacting
Business
Under the Foreign Business Registration Act
and Foreign Investments Act, acts that
constitute doing business includes:
(1) Soliciting orders, service contracts,
opening offices
(2) Appointing representatives or
distributors either
(a) Domiciled in the Philippines
(b) Stay in the country for 180 days or
more
(3) Participating in the management,
supervision, or control of any domestic
business, firm, entity, or corporation in
the Philippines
(4) Any other act that implies a continuity
of commercial dealings or
arrangements
(5) The exercise of some functions
normally incident to, and in progressive
prosecution of, commercial gain or of
the purpose and object of the business
organization
F.2. PARTNERSHIPS
To determine the entitlements and
limitations applicable to the
partnership law of the domicile
applies
To determine the legal capacity of
foreign corporations to contract
personal law applies
o But Philippine law remains
applicable to:
The creation of their
establishments in the
Philippines
The mercantile
operations
The jurisdiction of the
courts of the Philippines
To determine the existence of the
partnership personal law applies
To determine the grounds for
dissolution and termination of the
partnership personal law applies
Extraterritorial enforcement of in personam
judgments against partnership
There is jurisdiction over the
partnership or unincorporated
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
577
association if under the circumstances,
there is jurisdiction over an individual
A judgment against a partnership or
association is enforceable against its
assets in every state.

V. Foreign Judgments
A. RECOGNITION AND
ENFORCEMENT OF FOREIGN
JUDGMENTS
A.1. DISTINCTION BETWEEN
RECOGNITION AND ENFORCEMENT
Foreign Judgment
All decisions rendered outside the
forum
Encompasses judgments, decrees, and
orders of (1) foreign governments
(2)sister states in a federal government
Enforcement
Occurs when the successful plaintiff
fails to obtain satisfaction of a
judgment in the court which granted it
The plaintiff may try to enforce the
judgment in another state where the
defendant can be located
Recognition
Occurs when the defendant wins, and
asserts that decision in order to
preclude the plaintiff from filing a suit
on the same claim in another forum
A.2. BASES OF RECOGNITION AND
ENFORCEMENT OF FOREIGN
JUDGMENTS
Comity
In order to obtain a reciprocal
treatment from the courts of other
countries, we are compelled to take
foreign judgments as they stand and to
give them Full Faith and Credit
Obligation of foreign judgment
Derived from the vested rights theory
A.3. POLICIES UNDERLYING
RECOGNITION AND ENFORCEMENT
Res judicata
Those who have contested an issue
shall be bound by the result of the
contest
Prevents parties from litigating issues
that have been determined by a valid
local judgment
Applies in the Philippines to foreign
judgments through sec. 40, Rule 39
A.4. REQUISITES FOR RECOGNITION OR
ENFORCEMENT
i. The Foreign Judgment was Rendered by a
Judicial or Quasi-Judicial Tribunal which had
Jurisdiction Over the Parties and the Case in the
Proper Judicial Proceedings
Bases of jurisdiction
(1) Proceedings in personam
(a) Consent of the parties
(b) Relation of the parties or events
to the forum
(2) Proceeding in rem
(a) State power over the property
found within the territory
ii. The Judgment Must Be Valid Under the Laws
of the Court that Rendered It
iii. The Judgment Must be Final and Executory
to Constitute Res Judicata in Another Action
UP LAW BOC PRIVATE INTERNATIONAL LAW CIVIL LAW
578
The foreign judgment creates no
obligation on the forum court to
recognize or enforce it if it is merely
interlocutory or provisional,
contemplating a fuller investigation
leading to a later final decision.
iv. The State Where the Foreign Judgment was
Obtained Allows Recognition or Enforcement of
Philippine Judgments
Reiteration of international comity
v. The Judgment Must be for a Fixed Sum of
Money
Unless the foreign judgment specifies
performance or delivery, there is
nothing for the forum court to enforce.
vi. The Foreign Judgment Must Not be Contrary
to the Public Policy or Good Morals of the
Country Where it is to be Enforced
vii. The Judgment Must Not Have Been
Obtained by Fraud, Collusion, Mistake of Fact
or Mistake of Law
A.5. PROCEDURE FOR ENFORCEMENT
When a foreign judgment is recognized, it is
not instantaneously executed as a judgment.
A petition should be filed in the proper court
attaching an authenticated copy of the foreign
judgment to be enforced.
Authentication calls for the
Philippine consul assigned to the
country where the foreign judgment
was decreed to certify that had
been rendered by a court of
competent jurisdiction.