(Sps. Timado v. Atty. Avelino Sales, G.R. No.

201436, July 11, 2016)

As regards the attorney’s fees, the law is clear that in the absence of stipulation, attorney’s
fees may be awarded as actual or compensatory damages under any of the circumstances provided
for in Article 2208 of the Civil Code.
The general rule is that attorney’s fees cannot be recovered as part of damages because of
the policy that no premium should be placed on the right to litigate. They are not to be awarded
every time a party wins a suit. The power of the court to award attorney’s fees under Article 2208
demands factual, legal, and equitable justification. Even when a claimant is compelled to litigate
with third persons or to incur expenses to protect his rights, still attorney’s fees may not be awarded
where no sufficient showing of bad faith could be reflected in a party’s persistence in a case other
than an erroneous conviction of the righteousness of his cause.25

to the winning party lies within the discretion of the court, taking into account the
circumstances of each case

The general rule is that the award of attorney’s fees should have factual, legal, and equitable
basis, not founded on pure speculation and conjecture. (Sps. Timado v. Atty. Avelino Sales, G.R. No.
201436, July 11, 2016) Furthermore, the court should state the reason for the award of attorney’s
fees in the body of the decision. (Marilag v. Martinez, G.R. No. 201892, July 22, 2015)

In the present case, the court a quo expressly stated in the body of its decision its basis for
awarding attorney’s fees, to wit:

“As to the claim of attorney’s fees, the court awards the same pursuant to Article 2208 (2) of
the Civil Code, plaintiff having been compelled to litigate to protect her interest. The court finds the
amount of attorney’s fees at Php100,000.00 plus appearance fee of Php2,000.00 per hearing as
reasonable under the circumstances.”

It is very evident that defendants have no intention of fulfilling their obligation. Despite the
efforts exerted [by] the herein plaintiff, the defendants in complete disregard [of] the plaintiffs rights
still adamantly refused to restore the hard earned money of the said plaintiff to his damage and
prejudice. Such unjust enrichment at the expense of another has always been abhorred in this
jurisdiction. (Purificacion Buing & Romeo Buing v. Cecilio Santos, G.R. No. 152544, September 19,
2006)

Although attorney’s fees are not allowed in the absence of stipulation, the court can award
the same when the defendants act or omission has compelled the plaintiff to incur expenses to
protect his interest or where the defendant acted in gross and evident bad faith in refusing to satisfy
the plaintiff's plainly valid, just, and demandable claim. (Alcatel Philippines Inc., v. I.M Bongar & Co.,
Inc. and Stronghold Insurance Co., Inc., G.R. No. 182946, October 5, 2011)

Still, the award of attorneys fees to the winning party lies within the discretion of the court,
taking into account the circumstances of each case. This means that such an award should
have factual, legal, and equitable basis, not founded on pure speculation and conjecture. Further, the
court should state the reason for the award of attorneys fees in the body of the decision. Its
unheralded appearance in the dispositive portion is, as a rule, not allowed. (Pagsibigan v.
People, G.R. No. 163868, June 4, 2009)

Here, although the court a quo did not specifically discuss in detail its basis for awarding
attorney’s fees, its findings of fact clearly support such an award. For instance, the court a quo found,
based on the record that defendants persistently and clearly violated the terms of its contract with
plaintiff-appellee. They failed to settle their obligation despite demand from plaintiff-appellee,
prompting the filing of the complaint. Worse, when plaintiff-appellee commenced the present suit
against defendants, Jimmy Perez surreptitiously went out of the country while Eduardo Pavico no
longer resides at his given address. Considering foregoing, it is crystal clear that plaintiff-appellee had
no choice but to litigate her claims to protect her interest.

It was not DBPs act of facilitating the transfer of Traverses insurance policy from FGU to
Central that compelled Traverse to litigate its claims, but rather Centrals persistent refusal to pay
such claims. Thus, only Central should be held liable for the payment of attorneys fees and costs of
suit. (DBP vs. Traverse Development v. Traverse Development Corp. and Central and Insurance
Company, G.R. No. 169293, October 5, 2011)