Philippine Transmarine Carriers, Inc. v.

Legazpi
GR No. 202791
 FACTS

 Leandro Legazpi

 Was employed as utility pastry on board the vessel “Azamara Journey” under the
employment of Philippine Transamarine Carriers, Inc.
 Legazpi’s employment was covered by a Collective Bargaining Agreement (CBA) wherein it
was agreed that the company shall pay a minimum disability compensation = USD 60,000
only.
 While on board the vessel, Legazpi’s suffered cardiac arrest SIP ICD Insertation.
 He was checked by ship’s doctor and was prescribed medications.
 On November 14, 2008, Legazpi was to receive medical tratment and examination.
 The company designated physician assesed his condition to be Disability Grade 2.
 Not satisfied. Filed a complaint for full and permanent disability compensation.
 LA- USD 80,000 plus USD 1,320 as sick wages based on the ITF Cruise Ship Model
Agreement for catering personnel, not on the CBA.
 NLRC- affirmed LA’s decision.
 Hearing on the motion for execution- receipt of USD 81,320 with undertaking to return the
entire amount in the event that the petition for certiaorari is granted without prejudice.
 Additional payments of USD 8,132 and Php 3,042.95.
 CA- USD 60,000 based on CBA.
 ISSUE

 Is the Philippine Transmarine Carriers, Inc. entitled to a refund of excess payment

 HELD
 Yes.
 Voluntary agreement- binding and may not be later disowned because of a change of mind.
 Since the CA partially granted the petition for certiaorari, then the condition under the
agreement must be compiled.
 RATIONALE
 In Article 1158, it is stated that obligations derived from law are not presumed.
 Saludaga v. Far Eastern University
GR No. 179337
April 30, 2008
 FACTS
 Joseph Saludaga was a sophomore law student of FEU when he was shot by Alejandro
Rosete, security guard on duty at school premises, August 18, 1996.
 Saludaga was rushed to FEU-NRMF due to the wound he sustained.
 Rosete was brought to the police station.
 He explained that the shooting was accidental.
 Saludaga filed a complaint for damages against respondents on the ground that they breach
their obligation to provide students with a safe and secure environment and an atmosphere
conductive to learning.
 ISSUE

 Whether or not FEU is liable to pay damages for breach of contract.

 HELD
 Yes.
 When an academic institution accepts students for enrollment, contract is bestablished. A
bilateral obligations which both parties are bound to comply with.
 School- provide students with an education; maintain peace and order.
 Students- follows rules and regulations and must abide school’s academic requirements.
 FEU failed to comply with its obligation to ensure a safe learning environment.
 FEU was negligent.
 RATIONALE
 Article 1170- Negligence = Damages
 Institutions of learnings must also meet the implicit obligation of providing their students
with an atmosphere that promotes in attaining its primary undertaking of impairing
knowledge.
 Philippine Airlines, Inc. v. Court of Appeals
GR No. 123238
September 22, 2008
 FACTS
 May 2, 1980, Manuel Buncio and Aurora Buncio purchased from PAL, Inc. two plane
tickets for their two minor children, Deanna, 9 and Nikolai, 8.
 PAL required private respondents to accomplish, sign and submit to it an indemnity bond.
 For the purchase of two tickets, PAL agreed to transport Deanna and Nikolai from Manila
to San Francisco, California, USA, flight 106.
 PAL also agreed that upon the arrival of two children in San Francisco Airport on May 3,
1980, it would again transport the two on the same day thru the connecting flight from San
Francisco to Los Angeles via United Airways 996.
 The staff of United Airways 996 refused to take aboard the two children for their
connecting flights to Los Angeles.
 The indemnity bond was lost by PAL personnel during the previous stop-over in Hawaii.
 Deanna and Nikolai were left stranded at San Francisco Airport.
 Private respondents filed a complaint for damages against the petitioner.
 ISSUE

 Whether or not PAL is liable for damages against the Buncio’s for the failure of the
children to board the United Airways flight to Los Angeles.
 HELD
 Yes, because there is a breach of contract of carriage.
 When the private respondents purchased two tickets from PAL, a contract of air carriage
arises.
 Airlines obligation is to carry the passenger and his luggage safely to destination without
delay.
 RATIONALE
 Article 1159 stated that obligations arising from contracts have the force of law between
the contracting parties and should be complied within a good faith.
 Compliance in good faith means compliance in accordance with stipulations of the contract
or agreement.
 Perez v. Pomar
GR No. L-1200
November 16, 1903
 FACTS
 Vicente Perez- filed in the Court of First Instance of Laguna a compalint against Pomar.
 In the complaint, it was alleged that Pomar rendered services of Perez to act as interpreter
between former and military officers.
 Pomar assured him that the Tabacalera Company generously reoaid services redered it.
 Pomar going so far as to make him flattering promises of employment with the company,
which he did not accept.
 These statements were made in the absence of witnesses and that therefore his only proof
was Pomar’s owrd as a gentleman.
 Pomar filed an answer to the complaint on Sepetember 25, 1902 asking for the dismissal of
the complaint with the cost to Perez.
 Pomar denied the allegation and stated that it is wholly untrue.
 He also stated that Perez acted as interpreter of his own free will without any offer of
payment.
 ISSUE

 Whether or not a contract is formed between Perez and Pomar.

 HELD
 The judgment is rendered against Pomar the payment to Perez of the sum 200 Mexican
pesos, from which will be deducted the sum of 50 pesos is made as to the costs of this
instance.
 RATIONALE
 Article 1254- a contract exists the moment that one or more persons consent to be bound
with respect to another or others, to deliver some thing or render some services.
 Article 1160- Quasi-contracts.
 Andres v. Manufacturers Hanover and Trust Corporation
GR No. 82670
September 15, 1989
 FACTS
 Dometila Andres- doing business under the name and style “Irene’s Wearing Apparel”.
 Facets Funwear, Inc. of United States is one of its foreign buyer.
 August 1980, Facets instructed FNSB of New Jersey to transfer $10,000 to Irene’s Wearing
Apparel via PNB Sta. Cruz, Manila branch.
 FNSB instructed Manufacturers Hanover and Trust Corporation (MHTC) to effect the
transfer by charging the amount to the account of FNSB with MHTC.
 The payment was not effected immediately because the payee designated in the telex was
only “Wearing Apparel”.
 MHTC sent PNB another telex stating that the payment was to “Irene’s Wearing Apparel”.
 August 28, 1980, Dometila received the remittance of $10,000.
 Unaware that Dometila had already received the remittance, Facets informed MHTC about
the delay and amended its instruction by asking MHTC to effect the payment through PCIB
instead of PNB.
 MHTC also unaware that Dometila had already received the remittance from PNB,
instructed PCIB to pay $10,000 to Dometila.
 When FNSB discovered that MHTC had made a duplication of remittance, it asked for a
recredit of its account in the amount of $10,000.
 MHTC asked Dometila to return the 2nd remittance of $10,000 but she refused to do so.
 ISSUE

 Whether or not MHTC has the right to recover the 2nd remittance it had delivered to
Dometila.
 HELD
 No. There was a mistake, not negligence in the 2nd remittance.
 Dometila had a contract with Facets. Hence, it was Facets and not MHTC which was
indebted to Dometila.
 Dometila must return the 2nd remittance to MHTC.
  RATIONALE
 Article 1160- Quasi-contract
 Solutio Indebiti- the obligation of the debtor is to return what he received by mistake.
 Payment made by mistake where there was no rught to receive payment, resulting in the
adjust enrichment of the payee.
 People of the Philippines v. Combate a.k.a. Peping
GR No. 189301
December 15, 2010
 FACTS
 Jose Combate- charged for killing Edmundo Prayco and Leopoldo Guiro, Jr.
 March 16, 1995, Tomaro parked his jeepney at the garage of Leopoldo’s mother.
 He saw Leopoldo and Edmundo who was on their way out and also invited him to join
them in drinking which he refused.
 Tamaro heard a gunshot when he was about to went up the stairs.
 He rushed back to the road and saw Combate pointing a gun at Leopaldo.
 Edmundo was about to intervene but Combate shot him at a very close range.
 Tamaro rushed to help them and pleaded for his life but Combate point his gun at Tamaro
but the gun did not fire.
 Tamaro then tried to get the gun from Combate and shot him but the gun did not fire.
 Combate then fled to the direction of Bacolod City.
 ISSUE

 Whether or not Combate is guilty beyond reasonable doubt.

 HELD
 Yes. Combate was found guilty of the crimes of murder of Edmundo and Homicide of
Leopaldo.
 Combate was sentenced Reclusion Perpetua- murder; Reclusion Temporal- homicide.
 He was condemned to pay the heirs of Edmundo the sum of ₱50,000 as civil indemnity.
 He was also condemned to pay the heirs of Leopoldo the sum of ₱50,000 as civil indemnity
and the sum of ₱56,319.59 as reimbursement for the burial expenses.
 RATIONALE
 Article 100 “Every person criminally liable for a felony is also civilly liable.”
 Article 1161- Delicts. Crime= pay for damages.
 Civil liability ex delicto may come in the form of restitution, resparation and
indemnification.
 Chan, Jr. v. Iglesia ni Cristo, Inc.
GR No. 160283
October 14, 2005
 FACTS
 Chan, Jr. owns the Aringay Shell Gasoline station in La Union.
 It is bounded on the south by a chapel of the INC.
 The gasoline station needed additional sewerage and septic tanks for its washroom.
 Chan procured the services of Dioscoro Yoro, a retired general of Armed Forces of the
Philippines.
 Chan and Yoro executed a memorandum of Agreement on the digging of the septic tank.
 It was agreed that in the event that valuable objects are found on the property during the
digging, 60% and 40% was the agreed ratio of share. If outside the property, 35% and 65%
to Chan and Yoro respectively was agreed.
 Chan was informed by members of INC that the diggings traversed and penetrated a
portion of land belonging to INC.
 The foundation of the chapel was affected as a tunnel was dug directly under it to the
damage and prejudice of INC.
 ISSUE

 Whether or not Chan and Yoro are liable to pay for damages.
 HELD
 Yes. The diggings were not intended to cinstruct sewerage and septic tanks but were made
to find hidden treasures.
 The fortuitous act was excavation, which caused damage to INC because it was done
surreptitiously within its premises, affecting the foundation of the chapel.
 RATIONALE
 Article 2176 states that whoever by act or omission causes damage to another, there being
fault or negligence, is obliged to pay for damages done.
 Article 1162- Quasi-delicts.
 Josefa v. Manila Electric Company
GR No. 182705
July 18, 2014
 FACTS
 Vicente Josefab has truck with a plate no. PAK-874 that hit the electricity post.
 April 21, 1991, around 1:45pm, a dump truck, a jeepney and a car figured in a vehicular
accident along Ortigas ave., Pasig City.
 As a result of an accident, a 45-foot wooden electricity post, three 75 KVA transformers,
and other electrical line attachments were damaged.
 Meralco demanded from Vicente reimbursement for the replacement cost of the electricity
post and its attachments, but Vicente refused to pay.
 ISSUE

 Whether or not Josefa is liable to pay for damages.

 HELD
 Yes.
 Whoever by act or omission causes damage to another, there being fault or negligence, is
obliged to pay for damages done.
 It is very unusual and extraordinary for the truck to hit an electricity post, an immovable
and stationary object, unless the truck driver acted with fault or negligence.
 Various responsibility is imputed on Vicente, the owner of the truck a shis employee acted
with negligence.
 RATIONALE
 Negligence = Damages
 Article 1162- Quasi-delicts
 The fault or negligence of a defendant, which is the basis of an action for quasi-delict,
should be the proximate cause of the injury suffered by the plaintiff.
 Santos Ventura Hocorma Foundation, Inc. v. Santos
GR No. 153004
November 5, 2004
 FACTS
 Ernesto Santos and Santos Ventura Hocorma Foundation, Inc. (SVHFI) were the parties in
several civil cases filed in different courts.
 On October 26, 1990, the parties executed a Compromise Agreement (CA) which amicably
ended all their pending litigations.
 SVHFI shall pay ernesto ₱14.5M.
o ₱1.5M upon the execution of CA.

o ₱13M shall be paid within a period of not more than 2 years.

 Upon the execution of CA and receipt of ₱1.5M, Ernesto shall cause the dismissal with
prejudice of all civil cases.
 In compliance of CA, Ernesto moved for the dismissal of the civil cases.
 SVHFI paid ₱1.5M to Ernesto leaving a balance of ₱13M.
 On September 30, 1991, the RTC approved the CA.
 On October 28, 1992, Ernesto sent a demand letter to SVHFI for the balance of ₱13M.
 There was no response from SVHFI.
 Ernesto applied with the RTC for the issuance of a writ of execution of its compromise
judgment.
 Payment of the balance was effected only on November 22, 1994.
 ISSUE

 Whether there was delay on the part of the Foundation in paying its obligation under the
Compromise Agreement.
 HELD
 Yes.
 It is liable for damages in the form of interest.
 CA become binding upon its execution and not upon its court approval.
 The 2-year period to pay must be counted from October 26, 1990 and not on judicial
approval of the agreement (September 30, 1991).
 When Ernesto wrote a demand letter to SVHFI on October 28, 1992, the obligation was
already due and demandable.
 When SVHFI failed to pay its due obligation after the demand was made, it incurred delay.
 RATIONALE
 Delay in Article 1169 is synonymous to default or mora which means delay in the
fulfillment of obligations.
 No demand, no delay. But as for the obligation of above case is due and demandable,
SVHFI is liable for the delay in the performance of its obligation.
 Chavez v. Presidential Commission on Good Government
GR No. 130716
December 9, 1988
 FACTS
 Francisco Chavez- a taxpayer, citizen and former government official impelled to bring this
action regarding several news reports on:
o the alleged discovery of billions of dollars of Marcos assets deposited in various
coded accounts in Swiss bank.
o the reported execution of a compromise, between the government (through PCGG)
and the Marcos heirs, on how to split or share these assets.
 Chavez demands that respondents made public any negotiations and agreements pertaining
to PCGG’s task of recovering the Marcoses’ ill'gotten wealth.
 Respondents contended that Chavez’s action is premature, because there is no showing that
he has asked the PCGG to disclose the negotiations and the agreements.
 President Ramos, in his memorandum, commanded the PCGG Chairman not to approve the
Compromise Agreements.
 ISSUE

 Whether or not the court coud require the PCGG to disclose to te public the details of any
agreement, perfected or not, with the marcoses.

 Whether or not the General and Supplemental agreements between PCGG and Marcoses
heirs be valid.
 HELD
 Yes, because it is the right of people to be informed in matters of public concern.
 No, because compromise of taxes is not valid.
 An action for future fraud may not be waived.
 RATIONALE
 Section 7, Article III of the Philippine Constitution.
 Article 1171
 The stipulation of Compromise Agreement does not specify the exact scope of future
claims against Marcoses and the government thereby relinquishes.
 Philippine National Railways Corporation v. Vizcara
GR No. 190022
February 15, 2012
 FACTS
 On May 14, 2004, at about 3:00am, Reynaldo Vizcara was driving a passenger jeepney
headed towards Bicol to deliver onion crops, with his companions (Cresencio,Crispin,
Samuel, Dominador and Joel).
 While crossing the railroad track in Tiaong, Quezon, a PNR train suddenly turned up and
rammed the passenger jeepney.
 The collision resulted to the instantaneous death of Reynaldo, Cresencio, Crispin and
Samuel. Dominador and Joel sustained serious physical injuries.
 There was noblevel crossing installed.
 “Stop, Look and Listen” signage was poorly maintained.
 On september 15, 2004, the survivors together with the heirs of the deceased victims, filed
an action for damages against PNR.
 It was PNR’s gross negligence in not providing adequate safely measures to prevent injury
to persons and properties.
 There was no level crossing bar, lighting equipment or bell installed as warning.
 ISSUE

 Whether or not he proximate cause of the accident was the negligence of the petitioners.
 HELD
 Yes.
 PNR fell short of the diligence expected of it, taking into consideration the nature of its
business, to forestall any untoward incident.
 Responsibility of the railroad company to use reasonable care to keep the signal devices in
working order. Failure to do so would be an indication of negligence.
 RATIONALE
 Article 1172- responsibility arising from negligence in the performance of every kind of
obligation is also demandable.
 Negligence = Damages
 Austria v. The Court of Appeals (2nd Division)
GR No. L-29640
June 10, 1971
 FACTS
 In a receipt dated January 30, 1961, Maria Abad acknowledged having received from
Guillermo Austria one pendant with diamonds valued ₱4,500.
 To be sold on commission basis or to be return on demand.
 On February 1, 1961, Maria have been accosted by two men, one of whom hit her face,
while the other snatched her purse containing jewelry and cash.
 The consigned pendant was one of the jewelry taken away.
 Maria failed to return the jewelry or pay for its value.
 Guillermo brought in the Court of First Instance (CFI) an action against Maria and her
husband for recovery of the pendant or of its value and damages.
 Abad set up defense that the alleged robbery had extinguished their obligation.
 CFI rendered judgment for Guillermo and held that Abad failed to prove the fact of
robbery.
 It was committed that Maria was guilty of negligence when she went home without any
companion, although it was getting dark and she was carrying a large amount of cash and
valiables on the day in question.
 Such negligence did not free her from liability for damages for the loss of the jewelry.
 Abad secured reversal of judgment.
 ISSUE

 Whether or not Abad was negligent.

 HELD
 No. In 1961, when the robbery in question did take place, for at that time criminality had
not by far reached the levels attained in the present day.
 The diligence that Abad portrayed when she went home before she was robbed was not a
sign of negligence on her part.
  RATIONALE
 ART. 1170. Those who in the performance of their obligations are guilty of fraud,
negligence, or delay, and those who in any manner contravene the tenor thereof, are liable
for damages.
 ART. 1174. Except in cases expressly specified by 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.
 Stonghold Insurance Company, Inc. v. Republic-Asahi Glass Corporation
GR No. 147561
 FACTS
 On May 24, 1989, Republic-Asahi Glass Corporation (RAGC) entered into a contract with
Jose Santos, Jr., the proprietor of JDS Construction, for the construction of roadways and
drainage system in Republic-Asahi’s compound in Pasig City.
 Republic-Asahi was to pay JDS ₱5.3M.
 It was to be completed within 240-days period beginning May 8, 1989.
 JDS executed a performance bond of ₱795,000 jointly and severally with Stronghold
Insurance Company, Inc. (SICI).
 November 1989, Republic-Asahi’s engineers called the attention of JDS to the alleged
alarmingly slow pace of the construction, which resulted in the fear that the construction
will not be finished within 240-days period.
 November 24, 1989, Republic-Asahi dissatisfied with the progress of the work undertaken
by JDS, it extrajudicially rescinded the contract and alleged that it had to hire another
contractor to finish the project.
 Additional expenses, ₱3,256,874.
 Republic-Asahi filed a compalint against JDs and SICI for payment of ₱750,000 as
damages in accordance of performance bond.
 According to sheriff’s return on June 14, 1991, summons were duly served on SICI.
 Jose died on 1990.
 SICI alleged that Republic-Asahi’s money claims against JDS and SICI have been
extinguished by the death of Jose.
 ISSUE

 Whether SICI’s liability under the performance bond was automatically extinguished by
the death of Jose, the principal.
 HELD
 No.
 The death of either the creditor or the debtor does not extinguished the obligation.
 Obligations are transmissible to the heirs, except when transmission is prevented by the
law, the stipulations of the parties, or the nature of obligations.
 Section 5, Rule 86 of Rules of Court allows the prosecution of money claims arisising from
a contract against the estate of the deceased debtor.
 SICI cannot use Jose’s death to escape its monetary obligation under its performance bond.
 RATIONALE
 Article 1178.
 Transmissibility of rights- obligations are transmissible to the heirs, except when the
transmission is purely personal or prevented by law, stipulation and nature of the
obligation.
 Delgado v. Amenabar
GR No. 5693
August 4, 1910
 FACTS
 Agustin Amenabar was indebted to spouses Enrique Delgado and Concepcion Figueroa for
varioussums of rent and used of hacienda owned by the spouses.
 On March 5, 1908, Agustin signed an obligation for the indebtedness in favor of the
spouses in the sum of ₱2,261.
 ISSUE

 Whether or not the liability of Amenabar is due and demandable.

 HELD
 Yes.
 No date was fixed for its fulfillment.
 Amenabar failed to show that it was the intention of the spouses to grant him any extension
of time to pay his debt to the obligation arises from March 5, 1908.
 RATIONALE
 The obligation was pure, simple and unconditional. Therefore, spouses Enrique and
Concepcion could demand of the payment of this obligation at once.
 Article 1179
 Perez v. Court of Appeals
GR No. 112329
January 28, 2000
 FACTS
 Primitivo Perez has been insured with the BF Lifeman Insurance corporation since 1980 for
₱20,000.
 In 1987, Rodolfo Lalog, an agent of BF convinced him to apply for additional insurance of
₱50,000.
 Perez accomplished the application form and passed the required medical exam.
 He also paid ₱2,075 to Lalog for premium.
 On November 25, 1987, Primitivo died in an accident.
 At the time of his death, his application papers for the 2nd insurance were still being
processed.
 BF Lifeman approved the application and issued the corresponding policy for the 2nd
insurance on December 2, 1987 witjout knowing that Primitivo died.
 Virginia, wife of Primitivo, went to Manila to claim the benefits under the insurance
policies of Primitivo.
 She was paid ₱40,000 under the 1st insurance under the 1st insurance policy but BF
Lifeman refused to pay the claim under the 2nd insurance, ₱150,000.
 2nd insurance had not been perfected at the time of the death of Primitivo.
 BF Lifeman refunded the ₱2,075.
 ISSUE

 Whether or not the widow can receive the proceeds of the 2nd insurance policy.
 HELD
 No. Petition Dismissed.
 The policy must have been delivered and accepted by the applicant while he is in good
health.
 RATIONALE
 Article 1182; Suspensive Condition.
 Non-fulfillment of the condition resulted in the non-perfection of the contract.
 Coronel v. Court of Appeals
GR No. 103577
October 7, 1996
 FACTS
 On January 19, 1985, Romulo Coronel, et al. executed a document entitled “Receipt of
Downpayment” in favor of Ramona Alcaraz for sale of Property.
 Ramona will make downpayment of ₱50,000.
 Coronels will cause the transfer in their names from their deceased father upon the receipt
of ₱50,000 downpayment.
 Upon the transfer in their names, Coronels will execute the deed of absolute sale in favor of
Ramona and the latter will pay the balance of ₱1,190,000.
 On January 15, 1985, Conception Alcaraz paid the downpayment.
  On February 6, 1985, the property was transferred to Coronels.
 On February 18, 1985, petitioners sold the property to Mabanag for ₱1,580,000.
 On February 22, 1985, Concepcion, Ramona’s mother, filed an action for specific
performance.
 Coronels canceled and rescinded the contract with Ramona.
 On April 2, 1985, Mabanag caused the annotation of a notice of adverse claim covering the
subject property with the Registry of Deeds of Quezon City.
 On April 25, 1985, Coronels executed a Deed of Absolute Sale.
 On June 5, 1985, a new title over the subject property was issued in the name of Mabanag.
 ISSUE

 Whether the contract between petitioners and private respondent was that of a conditional
sale or a mere contract to sell.
 HELD
 Sale, by its very nature, is a consensual contract because it is perfected by mere consent.
 In a contract to sell, the prospective seller explicitly reserves the transfer of title to the
prospective buyer.
 The prospective seller does not as yet agree or consent to transfer ownership of the property
subject of the contract to sell until the happening of an event, which for present purposes
we shall take as the full payment of the purchase price.
 On January 19, 1985, the Coronels and Ramona entered into Suspensive Condition.
 On February 6, 1985, condition was fulfilled.
 The rights and obligations of the parties became due and demandable as Suspensive
Condition occurred.
 On February 6, 1985, the reciprocal obligations of both buyer and seller arose.
 The sale of Mabanag gave rise of double sale.
 RATIONALE
 Article 1187
 Reciprocal Obligation
 Suspensive Condition
 Vda. de Ouano v. The Republic of the Philippines
GR No. 168770
February 9, 2011
 FACTS
 In 1949, the National Airport Corporation (NAC), Mactan Cebu International Airport
Authority’s (MCIAA) predecessor agency, pursued a program to expand the Lahug
Airport in Cebu City.
 NAC negotiated with the owners of the properties situated around the airport.
 The landowners assured them that they could repurchase their respective lands should the
Lahug Airport expansion project do not push through or once the Lahug Airport closes or
its operations transferred to Mactan-Cebu Airport.
 On February 8, 1996, Ricardo L. Inocian and four others and Aletha Suico Magat and
seven others, filed before the RTC in Cebu City a complaint for reconveyance of real
properties and damages against MCIAA. The RT rendered a decision directing MCIAA
to reconvey the lands.
 On December 29, 1961, the Court of First Instance (CFI) declared the expropriation of
the lots included in the Lahug Airport.
 ISSUE

 Whether or not MCIAA reconvey the lands to petitioners.

 HELD
 Yes.
 Equity and justice demand the reconveyance by MCIAA of the litigated lands to the
former lot owners.
 The notion that the government via expropriation proceedings acquires unrestricted
ownership over or a free simple title to the covered land is no longer tenable.
 Expropriated land should be differentiated from a piece of land.
 In expropriation, the private owner is deprived of property against his will.
 RATIONALE
 Article 1189
 Suspensive conditional obligation
 If the thing is improved by its nature or by time, the improvement shall inure to the
benefit of the creditor.
 Maglasang, doing business under the name GL Enterprise
v. Northwestern Inc., University
GR No. 188986
March 20, 2013
 FACTS
 Northwestern engaged the services of GL Enterprises to install a new Integrated Bridge
System (IBS).
 Installation of IBS was required by the CHED before a school could offer maritime
transportation program.
 Northwestern required GL Enterprises to supply and install specific components.
 Northwestern paid ₱1M as downpayment to GL Enterprises.
 The balance of the contract price was ₱1.97M.
 GL Enterprises technicians delivered various materials.
 Northwestern found out that the delovered equipment were substandard.
 GL Enterprises violated the terms and conditions of the contract. The delivered
components were old, did not have instruction manulas and warranty certificates,
reconditioned machines and did not meet the IMO and CHED standards.
 Northwestern demanded compliance with the agreement.
 GL Enterprises filed a complaint for breach of contract and prayed for ₱1.97M.
 GL Enterprises alleged that Northwestern breach the contracts by ordering the work
stoppage.
 Northwestern asserted that since the equipment delivered were not in accordance with
the specifications provided.
 Northwestern prayed for the recission of the contracts.
 ISSUE

 Whether or not GL Enterprises breach the contract.

 Whether or not Northwestern breach the contract.

 HELD
 Yes.
 GL Enterprises failed in meeting its reponsibility as it supplied substandard equipment
for the new IBS without justification.
 No.
 The stoppage of the installation was justified.
 RATIONALE
 Article 1191
 As a general rule, recission is not permitted for a slight or casual breach of the contrzct
but only for one which is substantial and fundamental.
 Gonzales v. de Jose
GR No. L-43429
October 24, 1938
 FACTS
 Florentino de Jose excuted two promissory notes:
o I promise to pay Mr. Benito Gonzalez the sum of four hundred three pesos and
fifty-five centavos (P403.55) as soon as possible.
o I promise to pay Mr. Benito Gonzalez the sum of three hundred and seventy-three
pesos and thirty centavos (P373.30) as soon as possible.
 ISSUE

 Whether the defendant should pay the plaintiff according to the period fixed by court.
 HELD
 Yes.
 The creditor intended to grant the debtor a period within which to pay bis debts.
 RATIONALE
 Article 1197
 The courts may fix a period if the obligation does not fix a period but a period was
intended by the parties.
 Hermanos v. Paterno
GR No. L-5515
February 1, 1911
 FACTS
 Pedro Paterno executed a document in favor of Levy Hermanos, indicating that a balance
of P6,177.35 will be payable in partial payments.
 Paterno made several payments and later claimed to establish the installment of P30.00
per month payment.
 Hermanos disagreed and brought suit and asked that he should be paid the sum of
P5,862.35 (unpaid balance) or that a period be specified within which he should pay the
same, in case the court should deem such manner of payment more equitable.
 During the trial it was agreed by the parties that the sum which the Paterno owed
Hermanos was P5,317.35.
 In view of the evidence adduced during the trial, a monthly payment of P200 would be
reasonable compliance with the agreement to pay the debt in installment.
 The payment will be rendered on or before the 15th of each month.
 ISSUE

 Whether or not the Paterno should pay Hermanos according to the period fixed by court.
 HELD
 Yes.
 The trial court acted in accordance with the law in exercising said power by fixing the
duration of the period on the basis that the payment of the debt should be made at the rate
of P200.00 a month.
 There was no abuse of judicial discretion in fixing such a rate, considering the
importance of the obligatin and the absence of any stipulation of the interest in favor of
the creditor.
 RATIONALE
 Article 1197
 The courts may fix a period if the obligation does not fix a period but a period was
intended by the parties.
 Corpus v. Hon. Alikpala
GR No. L-23707
January 17, 1968
 FACTS
 Foreclosure of a real estate mortgage filed by Jose Corpus against Acme Steel
Manufacturing Co., Inc.
 On May 26, 1964, CFI rendered judgment upon a compromise.
o The unpaid balance of the purchase price of “Nestor de Castro Building” is
₱100,000.
o Acme Steel will pay the said balanve from the signing of compromise agreement
up to December 15, 1965.
o The interest of ₱12,000 shall be paid in advance by Acme Steel.

o The parties waived their claim for atty’s fees and damages.

o The failure of Acme Steel to pay Jose shall entitle Jose to the issuance of a writ of
execution of the entire balance, including interest.
 The ist interest of ₱6,000 was duly cashed. But the 2nd check for ₱6,000 was dishonored
for insufficiency of funds.
 On June 25, 1964, Jose invoking Acme Steel’s failure to pay on time on June 15, 1964,
moved for execution for the entire balance.
 ISSUE
 Is the order of execution appealable
 HELD
 No.
 The terms of the compromise agreement are complete, definite and certain, and no
suspensive condition is attached to any of them.
 Execution is never appealable.
 Jose was not seeking the resolution of the recission of the compromise agreement but its
enforcement.
 RATIONALE
 Article 1198
 Arco Pulp and Paper Co., Inc. v. Lim
GR No. 206806
June 25, 2014
 FACTS
 Dan Lim works in the business of supplying scrap papers, cartons, and other raw
materials, under the name Quality Paper and Plastic Products, Enterprises, to factories
engaged in the paper mill business
 From February 2007 to March 2007, he delivered scrap papers to Arco Pulp and Paper
Company, Inc. through its Chief Executive Officer and President, Candida A. Santos.
 The parties allegedly agreed that Arco Pulp and Paper would either pay Lim the value of
the raw materials or deliver to him their finished products of equivalent value.
 Lim alleged that when he delivered the raw materials, Arco Pulp and Paper issued a post-
dated check as partial payment, with the assurance that the check would not bounce.
 Arco Pulp and Paper and a certain Eric Sy executed a memorandum of agreement.
 Arco Pulp and Paper bound themselves to deliver their finished products to Megapack
Container Corporation, owned by Eric Sy, for his account.
 Raw materials would be supplied by Lim through his company Quality Paper and Plastic
Products.
 May 5, 2007, Lim sent a letter to Arco Pulp and Paper demanding payment but no
payment was made to him.
 Lim appealed the judgment with the Court of Appeals. According to him, novation did not
take place since the memorandum of agreement between Arco Pulp and Paper and Eric
Sy was an exclusive and private agreement between them.
 On January 11, 2013, the Court of Appeals rendered a decision reversing and setting aside
the judgment dated September 19, 2008 and ordering Arco Pulp and Paper to jointly and
severally pay Lim.
 ISSUE
 Whether the obligation between the parties was extinguished by novation
 HELD
 The petition is denied.
 The obligation between the parties was an alternative obligation
 The trial court erroneously ruled that the execution of the memorandum of agreement
constituted a novation of the contract between the parties.
  RATIONALE
 Article 1199- Alternative obligations
 In an alternative obligation, there is more than one object, and the fulfillment of one is
sufficient, determined by the choice of the debtor who generally has the right of election.
 Quizana v. Redugerio
GR No. L-6220
May 7, 1954
 FACTS

 Josef Postrado loaned P550

from Martina Quizana to be
paid or returned by the end of
January,
 1949
 Josef Postrado loaned P550
from Martina Quizana to be
paid or returned by the end of
January,
 1949
 Josef Postrado loaned P550
from Martina Quizana to be
paid or returned by the end of
January,
  1949.
 Josef Postrado loaned P550
from Martina Quizana to be
paid or returned by the end of
January,
 1949.
 Josef Postrado loaned P550 from Martina Quizana to be paid or returned by the end of
January,1949.
 On the event that the spouses will not be able to pay on the fixed day, they will pawn a
parcel of land in Marinduque.

 Quizana refused to accept

and the
 transfer of the land
 Quizana refused to accept and the transfer of the land.

 claims that the 2ndpart of the

written obligation is not
 binding since he did not sign
the document
 He claims that the 2ndpart of the written obligation is notbinding since he did not sign the
document
 ISSUE
  Whether or not the second part of the written obligation is valid, binding and effective.
 HELD
 Yes.
 The acceptance by him of the written obligation without objection and protest, and the fact
that he kept it and based his action thereon, are concrete and positive proof that he agreed
and contested to all its terms, including the paragraph on the constitution of the mortgage.
 RATIONALE
 Article 1206

 When only one prestation has

been
 agreed upon, but the obligor
may render another in
substitution, the obligation is
called
 facultative
 When only one prestation has beenagreed upon, but the obligor may render another in
substitution, the obligation is called facultative.
 Crystal v. Bank of the Philippine Island
GR No. 172428
November 28, 2008
 FACTS
 On March 28, 1978, spouses Crystal obtained a 300,000.00 loan in behalf of the Cebu
Contractors Consortium Company (CCCC) from the BPI-Butuan.
 On the same date, spouses Crystal executed in favor of BPI-Butuan a Continuing
Suretyship in the aggregate principal sum of not exceeding 300,000.00.
 On March 29, 1979, Crystal executed a promisory note.
 August 1979, CCCC renewed a previous loan, this time from BPI-Cebu.
 CCCC had no real property to offer as security of the loan.
 CCCC failed to pay loan to both BPI-Butuan and BPI-Cebu as they bacame due.
 CCCC as well as spouses Crystal failed to pay their obligations despite demands.
 BPI filed a complaint for sum of money against CCCC and spouses Crystal.
 ISSUE
 Whether or not the obligation of the spouses is extinguished.
 HELD
 No.
 The obligation is not yet extinguished.
 The court sees no stipulation in the promisory note which states that a third person may
fulfill the spouses’ obligation.
 RATIONALE
 Article 1236 stated that the creditor is not bound to accept payment or performance by a
third person who has no interest in the fulfillment of the obligation, unless there is
stipulation on the contrary.
 Article 1208- Solidary Obligations
 Sunga-Chan v. The Honorable Court of Appeals
GR No. 164401
June 25, 2008
 FACTS
 Lamberto Chua and Jacinto Sunga formed a partnership to engage in the marketing of
liquefied petroleum gas.
 For convenience's sake, the business under the name Shellite Gas Appliance Center
(Shellite) was registered as a sole proprietorship in the name of Jacinto, although the
partnership agreement called for the equal sharing of the net profits.
 After Jacinto's death, his widow Cecilia and daughter Lilibeth continued the business
without Lamberto's consent.
 Lamberto's subsequent repeated demands for accounting and winding-up went unheeded,
prompting him to file a complaint for the winding-up of partnership affairs, accounting,
appraisal, and recovery of shares and damages with the Regional Trial Court (RTC).

 ISSUE
 Whether or not Cecilia and Lilibeth is solidarily liable to give the 50% share of Lamberto
Chua to the partnership.

 HELD
 Yes.
 The court ruled that a partnership may be constituted in any form, except where immovable
property or real rights are contributed thereto, in which case a public instrument shall be
necessary.

 RATIONALE
 Article 1772 of the Civil Code requires that partnership with a capital of Php3,000.00 or
more must register with the Securities and Exchange Commission, however this
registration requirement is not mandatory.
 Article 1768 of the Civil Code explicitly provides that the partnership retains its juridical
personality even if it fails to register.
 Operators, Incorporated v. American Biscuit Co., Inc.
GR No. L-34767
October 23, 1987
 FACTS
 American Biscuit Company (American Biscure) manufacturer of biscuit, candy and bubble
gum products before World war II.
 After the liberation, it reopened its candy department.
 America Biscuit was forced to discontinue its business operations.
 To bail itself out of this financial distress, American Biscuit entered into an Operating
Contract with Operators, Inc. on September 26, 1953.
 Under this agreement, American Biscuit ceded the entire operation of its business to
Operators, in consideration for which Operators undertook to answer for existing
obligations of American Biscuit to its creditors, and to compensate American Biscuit with a
percentage of gross profits.
 American Biscuit and Operators entered into another agreement, this time with Associated
Biscuit Operators, Inc.
 Associated Biscuit agreed to engage in the manufacture and marketing of the biscuit
products of American Biscuit under the terms and conditions of the Operating Contract of
September 26, 1953.
 Arrangements were made between the parties for payment of the debts.
 It was agreed that Operators and Associated Biscuit would share 50%-50% in the payment
of monthly installments of the PII0,000 unpaid balance loan by China Banking Corporation
to American Biscuit.
 This arrangement was religiously complied with by Operators but Associated Biscuit failed
to make good its commitments to pay its share of P55,000.
 China Bank filed an action against American Biscuit.

 ISSUE
 Whether or not the obligation of American Biscuits and Operators was a solidary
obligation.
 HELD
 Yes.
 Solidarity may exist although the creditors and the debtors may not be bound in the same
manner and by the same periods and conditions.
 They were bound solidarily in connevtion with American Biscuit’s liabilities.
 RATIONALE
 Article 1211
 Article 1207- there is a solidary liability when the obligation expressly so states.
Republic Glass Corporation v. Qua
GR No. 144413
July 30, 2004
 FACTS
 Republic Glass, Gervel and Qua were shareholders of Ladtek.
 Ladtek obtained loans from Metrobank and Private Dev’t Corp of the Phils (PDCP).
 They entered into agreement that in case of default in payment of Ladtek loans, the parties
will reimburse each other the proportionate shares of any sum that any might pay to
creditors.
 Ladtek defaulted on its obligation to Metrobank and PDCP.
 Republic Glass Corp and Gervel Corp payed Metrobank 7M
 Republic Glass and Gervel demanded to Qua reimbursement of the total amount that RGC
and GC paid to Metrobank.
 Qua refused to pay
 Qua filed a complaint for injunction with. damages with application for TRO

 ISSUE
 Whether or not  payment of the entire obligation is an essential condition for
reimbursement

 HELD
 No.
 Contrary to RGC and GC’s claim, payment of any amount will not automatically result in
reimbursement.

 RATIONALE
 Since they only made partial payments, RGC and GC should clearly and convincingly
show that their payments to Metro bank and PDCP exceeded their proportionate shares in
the obligations before they can seek reimbursement from Qua.
 Article 1217
 Varorient Shipping Co., Inc. v. National Labor Relations Commission
GR No. 164940
November 28, 2007
 FACTS
 Varorient Shipping Co., Inc. acting as local manning agent of its foreign principal, Lagoa
Shipping Corporation, employed Rolando Perez as a fitter on board the vessel M/V
Sparrow.
 Rolando and Varorient, as agent of Lagoa executed a Contract of Employment
 Rolando started to suffer from persistent back pains.
 A foreign doctor treated Rolando issued a medical report certifying that Rolando was
already fit for continued employment but in light work only.
 Rolando was thus repatriated to the Philippines, as he could no longer perform his duties as
a fitter
 Rolando was diagnosed with lumbosacral instability
 The persistent back pains were caused by an injury in the lower spine causing Rolando's
lumbar curve to be abnormally exaggerated due to his lifting and carrying of heavy objects
as a fitter
 At the expense of Varorient, Rolando was placed by company-designated physicians under
a physical therapy program consisting of 10-20 sessions.
 Rolando filed a complaint with the National Labor Relations Commission (NLRC) praying
for disability benefits, illness allowance, reimbursement of medical and medicine expenses,
damages, and attorney's fees.
 Varorient filed with the Court of Appeals a Petition for Certiorari and Injunction, which
was dismissed.
 ISSUE
 Whether or not President Margarita, Varorient Company and Lagao Inc. are solidary liable
to Rolando Perez
 HELD
 Yes.
 When the agreement contains the "jointly and severally" then the obligations of the debtors
to creditors are solidary.
 The POEA    Rules and Regulations Governing the Recruitment and Employment of
Seafarers makes clear that the corporate officers, directors and partners are required to take
a verified undertaking containing "jointly and severally" liable with the company over
claims of employee to employer relationship
 RATIONALE
 Article 1222 stated that a solidary debtor may, in actions filed by the creditor, avail himself
of all defenses which are derived from the nature of the obligation and of those which are
personal to him, or pertain to his own share.

Chua v. The Executive Judge, Metropolitan Trial, Court, Manila

GR No. 202920
October 2, 2013
 FACTS
 On 13 January 2012, Richard Chua tiled before the Office of the City Prosecutor (OCP) of
Manila, a complaint charging Letty Sy Gan of forty (40) counts of violation of Batas
Pambansa Bilang (BP Blg. 22) or the Bouncing Checks Law.
 Consequently, the MeTC informed Chua that he has to pay a total of ₱540,668.00 as filing
fees for all the forty (40) counts of violation of BP Blg. 22.
 Due to non-payment of the required filing fees, the MeTC designated the forty (40) counts
of violation of BP Blg. 22 as undocketed cases under UDK Nos. 12001457 to 96.
 OCP moved for consolidation of the said cases.
 On 26 June 2012, the Executive Judge issued an Order denying petitioner’s Urgent Motion.
 Executive Judge of the MeTC ratiocinated that granting petitioner’s plea would constitute a
deferment in the payment of filing fees that, in turn, contravenes Section 1(b) of the Rule
111 of the Rules of Court.

 ISSUE
 Whether or not Chua can pay on per case basis.

 HELD
 Yes.
 Since the obligation is divisible, Chua can pay on a per case basis. Individually, based on
the amount of indicated in each check.
 Richard was not trying to evade or deny his obligation to pay for the filing fees.
 He acknowledges such obligation.

 RATIONALE
 Article 1223- The divisibility or indivisibility of the things that are the object of obligations
in which there is only one debtor and only one creditor does not alter or modify the
provisions of chapter 2 of this title.
 Cabarroguis v. Vicente

GR No. L-14304

March 23, 1960

 FACTS

 Cabarroguis, a registered nurse and midwife, sustained physical injuries as a result of an

accident when the AC jeepney of which she was a passenger hit another vehicle at a
street corner.

 To avoid court litigation, Vicente, owner and operator of the jeepney entered a
compromise agreement with Cabarroguis, obligating himself to pay 2,500 as actual and
compensatory, exemplary and moral damages suffered by Cabarroguis.

 Vicente has paid a total amount of 1,500 leaving a balance of 1,000.

 It was stipulated in the agreement that should Vicente fail to complete payment within 60
days, he would pay an additional amount of 200.00 as liquidated damages.

 As Vicente failed to pay, Cabarroguis brought a suit in the Municipal Court of Davao and
rendered judgment in favor of Cabarroguis.
 Vicente appealed to the Court of First Instance which ordered the Vicente to pay
Cabarroguis the amount of 1,200 with interest at legal rate from the date of the filing of the
complaint until full payment.

 ISSUE

 Whether or not Vicente should pay the interest and penalty.

 HELD

 No.

 If the obligation consists in a sum of money, the only damage a creditor may recover, if
the debtor incurs in delay, is the payment of the interest agreed upon or the legal interest,
unless contrary is stipulated  (Article 2209).
 This interest is recoverable from the time of delay.

 RATIONALE

 In obligations with a penal clause, however, as provided in Article 1226 of the new Civil
Code, the penalty shall substitute the indemnity for damages and the payment of interests.
The exceptions to this rule, according to the same article, are: (1) when the contrary is
stipulated; (2) when the debtor refuses to pay the penalty imposed in the obligation, in
which case the creditor is entitled to interest on the amount of the penalty, in accordance
with the Article 2209; and (3) when the obligor is guilty of fraud in the fulfillment of the
obligation.