melbejosano

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ROUND 10: ARTICLE 1401

ARTICLE 1401. THE ACTION FOR ANNULMENT OF CONTRACTS SHALL BE EXTINGUISHED WHEN THE THING IS THE OBJECT THEREOF IS LOST THROUGH THE FRAUD OR FAULT OF THE PERSON WHO HAS A RIGHT TO INSTITUTE THE PROCEEDINGS.

IF THE RIGHT OF ACTION IS BASED UPON THE CAPACITY OF ANY ONE OF THE CONTRACTING PARTIES, THE LOSS OF THE THING SHALL NOT BE AN OBSTACLE TO THE SUCCESS OF THE ACTION, UNLESS SAID LOSS TOOK PLACE THROUGH THE FRAUD OR FAULT OF THE PLANTIFF.

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ROUND 9: ARTICLE 1374

ARTICLE 1374. THE VARIOUS STIPULATING OF A CONTRACT SHALL BE INTERPRETED TOGETHER, ATTRIBUTING TO THE DOUBTFUL ONES THAT SENSE WHICH MAY RESULT FROM ALL OF THEM TAKEN JOINTLY.

Example:

The provision of the construction agreement between BCD company and a construction company provides that A construction company will construct two (2) buildings for the BCD company and the detailed plans for such buildings. The provision however appears toward the end of the agreement that three (3) buildings will be constructed. How should this be resolved?

Answer:

The various stipulations should be interpreted together. In this case, given the plans mentioned in the agreement. It would seem they only agreed to construct two (2) buildings.

_______________________________________________________________

MANILA INTERNATIONAL AIRPORT AUTHORITY, PETITIONER

VS

AVIA FILIPINAS, RESPONDENT

G.R. 180168, February 27, 2012

FACTS:

The petitioner Manila International Airport Authority (MIAA) entered into a contract of lease with herein respondent Avia Filipinas International Corporation (AFIC) on September 1990, wherein MIAA allowed AFIC to use specific portions of land as well as facilities within the Ninoy Aquino International Airport exclusively for the latter's aircraft repair station and chartering operations. The contract was for one (1) year, beginning September 1, 1990 until August 31, 1991, with a monthly rental of P6,580.00.

In December 1990, MIAA issued Administrative Order No. 1, Series of 1990, which revised the rates of dues, charges, fees or assessments for the use of its properties, facilities and services within the airport complex, effective on December 1, 1990. The monthly rent due from AFIC consequently increased to P15,996.50 but MIAA did not require AFIC to pay the new rental fee. Thus, the payment remained in the original fee of P6,580.00. After the expiration of the contract, AFIC continued to use and occupy the leased premises and kept on paying the original rental fee without protest on the part of MIAA.

After three years of the expiration of the original contract of lease, MIAA informed AFIC, through a billing statement dated October 6, 1994, that the monthly rental over the subject premises was increased to P15,966.50 beginning September 1, 1991. In short, the MIAA sought recovery of the difference between the increased rental rate and the original rental fee amounting to a total of P347,300.50 covering thirty-seven (37) months between September 1, 1991 and September 31, 1994. The AFIC refused to pay the difference in rental, which MIAA subsequently denied the AFIC employees access to the leased premises from July 1, 1997 until March 11, 1998.

AFIC then filed with the RTC of Quezon City a Complaint for damages with injunction against MIAA and its General Manager seeking uninterrupted access to the leased premises, recovery of actual and exemplary damages, refund of its monthly rentals with interest at the time that it was denied access to the area being rented as well as attorney's fees.

ISSUES:

WHETHER THE HONORABLE COURT CORRECTLY INTERPRETED THE PROVISIONS OF THE LEASE CONTRACT IN LINE WITH THE PROVISIONS OF THE CIVIL CODE AND EXISTING JURISPRUDENCE ON CONTRACTS.

RULING:

The RTC ruled in favor of the plaintiff [AFIC] and as against the defendants [MIAA] ordering the latter to pay plaintiff the refund the monthly rental payments beginning July 1, 1997 up [to] March 11, 1998 with interest at twelve (12%) percent, exemplary and moral damages, and other fees.

An appeal with the CA contending that the RTC erred in its decisions: (1) finding that MIAA is not entitled to apply the increase in rentals as against AFIC; (2) finding that MIAA is not entitled to padlock the leased premises or post guards to prevent entry of AFIC therein; and (3) awarding actual and exemplary damages and attorney's fees.

On June 19, 2007, the CA AFFIRMED with MODIFICATION. The awards of actual/compensatory damages and exemplary damages are deleted. The refund of monthly rental payments from July 1, 1997 to March 11, 1998 shall earn interest of six percent (6%) per annum from the date of the filing of the complaint until the finality of this decision. An interest of twelve percent (12%) per annum shall be imposed upon any unpaid balance from such finality until the judgment amount is fully satisfied.

The Supreme Court denied the petition due to lack of merit. The SC also affirmed the decision of CA and ordered the Regional Trial Court to comply with the directives of Supreme Court Administrative Circular No. 10-2000.

The SC mentioned that Article 1306 of the Civil Code should be applied in the case, which states that "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."

Moreover, Article 1374 of the Civil Code clearly provides that "the various stipulations of a contract shall be interpreted together, attributing to the doubtful ones that sense which may result from all of them taken jointly." Indeed, in construing a contract, the provisions thereof should not be read in isolation, but in relation to each other and in their entirety so as to render them effective, having in mind the intention of the parties and the purpose to be achieved. In other words, the stipulations in a contract and other contract documents should be interpreted together with the end in view of giving effect to all.

The Court finds nothing repugnant to law with respect to the questioned provisions of the contract of lease between petitioner and respondent. The Contract of Lease states that “any subsequent amendment to Administrative Order No. 4, Series of 1982, which will effect a decrease or escalation of the monthly rental or impose new and additional fees and charges, including but not limited to government/MIAA circulars, rules and regulation to this effect, shall be deemed incorporated herein and shall automatically amend this Contract insofar as the monthly rental is concerned. "However, the Court agrees with the CA that the above quoted provision of the lease contract should not be read in isolation. Rather, it should be read together with the provisions of Article VIII, Paragraph 8.13, which provide that "any amendment, alteration or modification of the Contract shall not be valid and binding, unless and until made in writing and signed by the parties thereto It is clear from the foregoing that the intention of the parties is to subject such amendment to the conformity of both petitioner and respondent. In the instant case, there is no showing that respondent gave his acquiescence to the said amendment or modification of the contract.

It may not be amiss to point out that during the above mentioned period, respondent continued to pay and petitioner kept on receiving the original rental fee of P6,580.00 without any reservations or protests from the latter. Neither did petitioner indicate in the official receipts it issued that the payments made by respondent constitute only partial fulfillment of the latter's obligations. Article 1235 of the Civil Code clearly states that "when the obligee accepts the performance knowing its incompleteness or irregularity, and without expressing any protest or objection, the obligation is deemed fully complied with." For failing to make any protest or objection, petitioner is already estopped from seeking recovery of the amount claimed.

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SECTION 2: OBJECT OF CONTRACTS

ARTICLE 1347. ALL THINGS WHICH ARE NOT OUTSIDE THE COMMERCE OF MEN, INCLUDING FUTURE THINGS, MAY BE THE OBJECT OF A CONTRACT. ALL RIGHTS WHICH ARE INTRAMISSIBLE MAY ALSO BE THE OBJECT OF CONTRACTS.

NO CONTRACT MAY BE ENTERED INTO UPON THE FUTURE INHERITANCE EXCEPT IN CASES EXPRESSLY AUTHORIZED BY LAW.

ALL SERVICES WHICH ARE NOT CONTRARY TO LAW, MORALS, GOOD CUSTOMS PUBLIC ORDER OR PUBLIC POLICY MAY LIKEWISE BE THE OBJECT OF A CONTRACT.

Explanation:

What is the difference between the object of contracts and its subject matter?

None, they are the same as stated in Article 1318 of the Civil Code

What may be the object of contracts?

Things, rights and services may be the object of contracts.

What things may be the object of contracts?

All things which are not outside of commerce of men, including future things.

What is meant by the term “outside the commerce of men?”

Those which cannot be the subject of trade or exchange such as selling of public

bridges or part of the sea.

May all future things be the object of contracts?

No, contracts involving future inheritance may not be the object of contracts except

those allowed by law. Hence, one may not sell to another the things which he

expects to get from his father by way of inheritance while the father is still alive.

May the right to vote be transmitted?

No, it is a personal right which cannot be transmitted.

What are transmissible rights?

Rights which cannot be transmitted by:

their name

stipulation

provision of law (Article 1311)

😎 May services be object of contract?

Yes, as long as it is not contrary to law, morals, good customs, public order or public

policy. Hence, a contract to paint one’s house is valid, But a contract to operate a

brothel is void for being against the law.

Example 1:

Jeffreys owns 5 hectares of rambutan trees. May the produce of that field on the coming harvest season be already sold to Allan?

Answer: Yes, the future things may be the object of contracts.

Example 2 :

Bong has the right to occupy a parcel of land belonging to Shena. May such rights of Bong be the object of contracts?

Answer: Yes, rights may be the object of contracts as long as it is not intramissible

_________________________________________________________________________

CASE DIGEST:

MILAGROS DE BELEN VDA DE CABALU

VS.

SPS. RENATO TABU AND DOLORES LAXAMANA

G.R. 188417, September 14, 2012

FACTS:

On December 8, 1941, Faustina died without any children. She left a holographic will, dated July 27, 1939, assigning and distributing her property to her nephews and nieces. The said holographic will, however, was not probated. One of the heirs was the father of Domingo Laxamana (Domingo), Benjamin Laxamana, who died in 1960. On March 5, 1975, Domingo allegedly executed a Deed of Sale of Undivided Parcel of Land disposing of his 9,000 square meter share of the land to Laureano Cabalu.

On August 1, 1994, to give effect to the holographic will, the forced and legitimate heirs of Faustina executed a Deed of Extra-Judicial Succession with Partition. The said deed imparted 9,000 square meters of the land covered by TCT No. 16776 to Domingo.

Thereafter, on December 14, 1995, Domingo sold 4,500 square meters of the 9,000 square meters to his nephew, Eleazar Tabamo. The document was captioned Deed of Sale of a Portion of Land. On May 7, 1996, the remaining 4,500 square meters of Domingo's share in the partition was registered under his name.

On August 4, 1996, Domingo passed away. Two months after his death, Domingo purportedly executed a Deed of Absolute Sale of TCT No. 281353 in favor of respondent Renato Tabu (Tabu). The resultant transfer of title was registered as TCT No. 286484. Subsequently, Tabu and his wife Dolores Laxamana (respondent spouses), subdivided the said lot into two.

On January 15, 1999, respondent Dolores Laxamana-Tabu, together with Julieta Tubilan-Laxamana, Teresita Laxamana, Erlita Laxamana, and Gretel Laxamana, the heirs of Domingo, filed an unlawful detainer action, docketed as Civil Case No. 7106, against Meliton Cabalu, Patricio Abus, Roger Talavera, Jesus Villar, Marcos Perez, Arthur Dizon, and all persons claiming rights under them. The heirs claimed that the defendants were merely allowed to occupy the subject lot by their late father, Domingo, but, when asked to vacate the property, they refused to do so. The case was ruled in favor of Domingo's heirs and a writ of execution was subsequently issued. Petitioners Milagros de Belen Vda. De Cabalu, Meliton Cabalu, Spouses Angela Cabalu and Rodolfo Talavera, and Patricio Abus (petitioners), filed a case for Declaration of Nullity of Deed of Absolute Sale, Joint Affidavit of Nullity of Transfer Certificate of Title Nos. 291338 and 291339, Quieting of Title, Reconveyance, Application for Restraining Order, Injunction and Damages (Civil Case No. 9290) against respondent spouses

In their complaint, petitioners claimed that they were the lawful owners of the subject property because it was sold to their father, Laureano Cabalu, by Domingo, through a Deed of Absolute Sale, dated March 5, 1975. Hence, being the rightful owners by way of succession, they could not be ejected from the subject property.

On September 30, 2003, the RTC dismissed the complaint as it found the Deed of Absolute Sale, dated March 5, 1975, null and void for lack of capacity to sell on the part of Domingo. Likewise, the Deed of Absolute Sale, dated October 8, 1996, covering the remaining 4,500 square meters of the subject property was declared ineffective having been executed by Domingo two months after his death on August 4, 1996.

ISSUES:

1] Whether the Deed of Sale of Undivided Parcel of Land covering the 9,000 square meter property executed by Domingo in favor of Laureano Cabalu on March 5, 1975, is valid; and

2] Whether the Deed of Sale, dated October 8, 1996, covering the 4,500 square meter portion of the 9,000 square meter property, executed by Domingo in favor of Renato Tabu, is null and void.

RULING:

The sale took place on March 1975 cannot be deemed valid because, at that time, Domingo was not yet the owner of the property. In the said will of Faustina, Benjamin, father of Domingo, appeared as one of the heirs. Thus, and as correctly found by the RTC, even if Benjamin died sometime in 1960, Domingo in 1975 could not yet validly dispose of the whole or even a portion thereof for the reason that he was not the sole heir of Benjamin, as his mother only died sometime in 1980. At the time the deed was executed, Faustina's will was not yet probated; the object of the contract, the 9,000 square meter property, still formed part of the inheritance of his father from the estate of Faustina; and Domingo had a mere inchoate hereditary right therein.

The Article 1347 of the Civil Code, "No contract may be entered into upon future inheritance except in cases expressly authorized by law." also applied in this case. Paragraph 2 of Article 1347, characterizes a contract entered into upon future inheritance as void. The law applies when the following requisites concur: (1) the succession has not yet been opened; (2) the object of the contract forms part of the inheritance; and (3) the promissor has, with respect to the object, an expectancy of a right which is purely hereditary in nature.

On the second issue, even though Domingo became the owner of the said property only on August 1, 1994, the deed of sale covering the remaining 4,500 square meters of the subject property executed in favor of Renato Tabu, was evidently null and void. The document itself, the Deed of Absolute Sale, dated October 8, 1996, readily shows that it was executed on August 4, 1996 more than two months after the death of Domingo. Contracting parties must be juristic entities at the time of the consummation of the contract. When any one party to a supposed contract was already dead at the time of its execution, such contract is undoubtedly simulated and false and, therefore, null and void by reason of its having been made after the death of the party who appears as one of the contracting parties therein. The death of a person terminates contractual capacity. The contract being null and void, the sale to Renato Tabu produced no legal effects and to transmit no rights whatsoever. Consequently, TCT No. 286484 issued to Tabu by virtue of the October 8, 1996 Deed of Sale, as well as its derivative titles, TCT Nos. 291338 and 291339, both registered in the name of Renato Tabu, married to Dolores Laxamana, are likewise void.

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ROUND 7: ARTICLE 1320

ARTICLE 1320. AN ACCEPTANCE MAY BE EXPRESSED OR IMPLIED.

Example : Dinna offered imported bags to Keanna and Theresa. Keanna said that she will buy one while Theresa simply took the bag from Dina. Which of the two accepted Dina’s offer?

Answer: Both of them. Keanna made an express acceptance while Theresa accepted it impliedly.

______________________________________________________________________

CASE DIGEST:

HEIRS OF FAUSTO IGNACIO

VS

HOME BANKERS SAVINGS AND TRUST COMPANY

G.R.177783, January 23, 2013

FACTS:

In August 1981, petitioner Fausto C. Ignacio mortgaged two parcels of land to Home Savings Bank and Trust Company, the predecessor of respondent Home Bankers Savings and Trust Company, as security for the P500,000.00 loan extended to him by said bank. These properties are located in Cabuyao, Laguna, covered by Transfer Certificate of Title Nos. (T-40380) T-8595 and (T-45804) T-8350, with an area of 83,303 square meters and 120,110 square meters (or 203m,413 sq.m or 20.34 hectares.

When petitioner defaulted in the payment of his loan obligation, respondent bank proceeded to foreclose the real estate mortgage. At the foreclosure sale held on January 26, 1983, respondent bank was the highest bidder for the sum of P764,984.67. The Certificate of Sale issued to the respondent bank was registered with the Registry of Deeds of Calamba, Laguna. With the failure of petitioner to redeem the foreclosed properties within one year from such registration, title to the properties were consolidated in favor of the respondent bank. Consequently, TCT Nos. T-8595 and T-8350 were cancelled and TCT Nos. 111058 and 111059 were issued in the name of the respondent bank.

Despite the lapse of the redemption period and consolidation of title in respondent bank, petitioner offered to repurchase the properties. While the respondent bank considered the petitioner's offer to repurchase, there was no repurchase contract executed between parties. The present controversy was fuelled by petitioner's stance that a verbal repurchase/compromise agreement was actually reached and implemented by the parties. It was only when the respondent bank sold the remaining subdivided to Spouses Thelma and Phillip Rodriguez without the petitioner’s knowledge that triggered the file for an action for specific performance and damages in the Regional Trial Court against the Bank.

ISSUE:

WHETHER THE CONTRACT FOR REPURCHASE OF THE FORECLOSED PROPERTIES WERE PERFECTED BETWEEN PETITIONER AND RESPONDENT- BANK.

RULING:

The RTC ruled in favor of the plaintiff and against the defendant and intervenor. The RTC said that the respondent deliberately disregarded the petitioner’s substantial payments on the repurchase consideration.

However, in the appeal of the respondent to the Court of Appeals, the CA reversed the RTC ruling. The CA said that the payments of the repurchase price were actually the payment made by the petitioner’s buyers for the purchase of subdivided lots. The respondent-intervenors were found to be purchasers of good faith without the notice of the petitioner’s interest of claims.

Nonetheless, since there was no repurchase contract perfected, the sale of the properties to the respondent-intervenors are valid and binding, and the issue of whether or not the latter mere innocent purchasers for value would be of no consequence. Article 1379 which states that “Consent is manifested by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract.” The offer must be certain and the acceptance absolute. A qualified acceptance constitutes a counter-offer.

The Supreme Court affirmed the decision of CA, in which the CA cited that the petitioner’s claim with utmost accommodation by the respondent bank with his terms for the repurchase of his foreclosed properties are simply contrary to the normal business practice.

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Round 6 : Article 1293

ARTICLE 1293 STATES THAT :

NOVATION WHICH CONSISTS IN SUBSTITUTING A NEW DEBTOR IN THE PLACE OF THE ORIGINAL ONE MAY BE MADE EVEN WITHOUT THE KNOWLEDGE OR AGAINST THE WILL OF THE LATTER, BUT NOT WITHOUT THE CONSENT OF THE CREDITOR. PAYMENT BY THE NEW DEBTOR GIVES HIM THE RIGHTS MENTIONED IN ARTICLES 1236 AND 1237.

What is Substitution?

It is a replacement of the original debtor with a new one.

May there be novation through substitution with the consent of the debtor?

Yes, it may be without the debtor’s consent.

May there be novation through substitution without the consent of the creditor?

No, in all cases, it must be with the consent of the creditor.

What are the kinds of substitution?

Expromision

In expromision, the initiative for the change does not come from the debtor. This requires the consent of the third person and the creditor.

Example:

Ronna owes Larry Php 1,000.00.00. Jimboy told Ronna that he will be the one to pay Ronna’s debt. Ronna agrees.

Delegacion

In delegacion, the debtor offers the substitution. It requires the consent of the debtor, the creditor and the third person.

Example:

Ronna owes Larry Php 1,000.00.00. Ronna told Larry that Jimboy will be the one to pay the debt. Larry agrees.

What are the rights mentioned in Articles 1236 and 1237?

Article 1236. The creditor is not bound to accept payment or performance by a third person who has no interest in the fulfillment of obligation, unless there is stipulation to the contrary.

Whoever pays for another may demand from the debtor what he has paid, except that if he paid without the knowledge or against the will of the debtor, he can recover only in so far as the payment has been beneficial to the debtor.

Article 1237. Whoever pays on behalf of the debtor without the knowledge or against the will of the latter, cannot compel the creditor to subrogate him in his rights, such as those arising from a mortgage, guaranty, or penalty.

Bognot vs RRI Lending

G.R. No. 180144, September 24, 2014

Ponente: Associate Justice Arturo Brion

FACTS:

In September 1996, Leonardo Bognot and his younger brother, Rolando Bognot applied for and obtained a loan of P500,000.00 from RRI Lending, payable on November 30, 1996. The loan was evidenced by a promissory note and was secured by a post dated check dated November 30, 1996. Evidence on record shows that Leonardo renewed the loan several times on a monthly basis. He paid a renewal fee of P54,600.00 for each renewal, issued a new post-dated check as security, and executed and/or renewed the promissory note previously issued. RRI Lending on the other hand, cancelled and returned to Leonardo the post-dated checks issued prior to their renewal. Leonardo paid the renewal fees and issued a post-dated check dated June 30, 1997 as security. As had been done in the past, RRI Lending superimposed the date "June 30, 1997" on the promissory note to make it appear that it would mature on the said date.

Several days before the loan’s maturity, Rolando’s wife, Julieta, went to the respondent’s office and applied for another renewal of the loan. She issued in favor of RRI Lending a promissory note and a check dated July 30, 1997, in the amount of P54,600.00 as renewal fee. On the excuse that she needs to bring home the loan documents for the Bognot siblings’ signatures and replacement, Julieta asked the RRI Lending clerk to release to her the promissory note, the disclosure statement, and the check dated July 30, 1997.

Julieta,however, never returned these documents nor issued a new post-dated check. Consequently, RRI Lending sent Leonardo follow-up letters demanding payment of the loan, plus interest and penalty charges. These demands went unheeded. In his Answer, Leonardo, claimed, among other things, that the complaint states no cause of action because RRI Lending’s claim had been paid, waived, abandoned or otherwise extinguished, and that the one(1) month loan contracted by Rolando and his wife in November 1996 which was lastly renewed in March 1997 had already been fully paid and extinguished in April1997.

ISSUE:

Whether the parties’ obligation was extinguished by payment

HELD:

No, Leonardo failed to satisfactorily prove that his obligation had already been extinguished by payment. As the CA correctly noted, the petitioner failed to present any evidence that RRI Lending had in fact encashed his check and applied the proceeds to the payment of the loan. Neither did he present official receipts evidencing payment, nor any proof that the check had been dishonored. Leonardo merely relied on the respondent’s cancellation and return to him of the check dated April 1,1997. The evidence shows that this check was issued to secure the indebtedness. The acts imputed on the respondent, standing alone, do not constitute sufficient evidence of payment.

Article 1249, paragraph 2 of the Civil Code provides “The delivery of promissory notes payable to order, or bills of exchange or other mercantile documents shall produce the effect of payment only when they have been cashed, or when through the fault of the creditor they have been impaired” .

Although Article 1271 of the Civil Code provides for a legal presumption of renunciation of action (in cases where a private document evidencing a credit was voluntarily returned by the creditor to the debtor), this presumption is merely prima facie and is not conclusive; the presumption loses efficacy when faced with evidence to the contrary. Moreover, the cited provision merely raises a presumption, not of payment, but of the renunciation of the credit where more convincing evidence would be required than what normally would be called for to prove payment. Thus, reliance by the petitioner on the legal presumption to prove payment is misplaced. To reiterate, no cash payment was proven by the petitioner. The cancellation and return of the check dated April 1, 1997, simply established his renewal of the loan- not the fact of payment. Furthermore, it has been established during trial, through repeated acts, that the respondent cancelled and surrendered the post-dated check previously issued whenever the loan is renewed

[melbejosano]

Round 5 - Article 1266

ARTICLE 1266 STATES THAT :

THE DEBTOR IN OBLIGATIONS TO DO SHALL BE RELEASED WHEN THE PRESTATION BECOMES LEGALLY AND PHYSICALLY IMPOSSIBLE WITHOUT THE FAULT OF THE OBLIGOR.

IS THIS ARTICLE ALSO APPLICABLE IN OBLIGATIONS TO GIVE?

It is applicable only to obligations “to do”, and not obligations “to give”. An obligation “to do” includes all kinds of work or service, while an obligation “to give” is prestation which consists in the delivery of a movable or an immovable thing in order to create a real right, or for the use of the recipient, or for its simple possession, or in order to return it to its owner. (PNCC vs. Court of Appeals, G. R. No. 116896, May 5, 1997)

G.R. No. 170405

Raymundo de Leon, Petitioner vs. Benita Ong, Respondent

FACTS:

Raymundo de Leon sold three (3) parcels of land located in Antipolo, Rizal to Benita Ong. As the properties were mortgaged to Real Savings and Loan Association, Inc. (RSLAI), the parties executed a notarized deed of absolute sale with assumption of mortgage. The deed of Assumption of mortgage will be executed with the following terms and conditions:

That upon full payment of the buyer of the amount of FOUR HUNDRED FIFTEEN THOUSAND FIVE HUNDRED (₱415,000), the seller shall execute and sign a deed of assumption of mortgage in favor of the buyer without any further cost whatsoever;

That buyer shall assume payment of the outstanding loan of SIX HUNDRED EIGHTY FOUR THOUSAND FIVE HUNDRED PESOS (₱684,500) with RSLAI located in Cainta, Rizal.

Benita Ong complied with the payment in the first condition, and the seller subsequently informed the RSLAI that the mortgage had been assumed by the buyer. Raymundo de Leon handed the keys and Benita Ong started to make improvements in the properties.

One day Ms. Ong learned that the properties were sold to another buyer, Leona Viloria. The second owner changed the locks of the properties. Benita Ong went to the RSLAI and learned that the mortgage was already fully paid and that the titles were given to Ms. Viloria.

Benita Ong filed a complaint in the Regional Trial Court for specific performance, declaration of nullity of the second sale and damages against petitioner and the second buyer, Leona Viloria.

Raymundo de Leon contended that Ong does not have a cause of action against him because the sale was subject to a condition which requires the approval of the loan company and that he and Benita Ong only entered a contract to sell.

ISSUES:

Whether the case involves a double sale.

Whether the parties entered into a contract of sale.

HELD:

The RTC dismissed the complaint for lack of cause of action and ordered respondent to pay petitioner ₱100,000 moral damages, ₱20,000 attorney’s fees and the cost of suit.

On the issue of the double sale as the disputed properties were sold validly on two separate occasions by the same seller to the two different buyers in good faith.

In the answer of the CA on the appeal of the respondent, the CA found that the contract executed by the parties did not impose any condition on the sale and held that the parties entered into a contract of sale. Consequently, because petitioner no longer owned the properties when he sold them to Viloria, thus the second sale was void. Moreover, the petitioner was liable for moral and exemplary damages for fraudulently depriving the respondent of the properties.

This is in reference with Article 1544 of the Civil Code which states that “If the same thing should have been sold to different vendees, the ownership shall be transferred to the person who may have first taken possession thereof in good faith, if it should be movable property. Should it be immovable property, the ownership shall belong to the person acquiring it who in good faith first recorded it in the Registry of Property.

On the second issue if the parties entered into a contract of sale.

The RTC ruled that the parties entered into a contract to sell while the CA held that it was contract of sale issues and ruling.

Yes, the parties entered into a contract of sale. The deed executed by the parties did not show that the owner intends to reserve ownership of the properties. The terms and conditions affected only the manner of payment and not the immediate transfer of ownership. It was clear that the owner intended a sale because he unqualifiedly delivered and transferred ownership of the properties to the respondent.

In a contract of sale, the seller conveys ownership of the property to the buyer upon the perfection of the contract. The non-payment of the price is a negative resolutory condition. Contract to sell is subject to a positive suspensive condition. The buyer does not acquire ownership of the property until he fully pays the purchase price

[melbejosano]

Round 4 - Article 1239

ARTICLE 1239 STATES THAT :

“IN OBLIGATIONS TO GIVE, PAYMENT BY ONE WHO DOES NOT HAVE THE FREE DISPOSAL OF THE THING DUE AND CAPACITY TO ALIENATE IT SHALL NOT BE VALID, WITHOUT PREJUDICE TO THE PROVISIONS OF ARTICLE 1427 UNDER THE TITLE ON “NATURAL OBLIGATIONS”.

WHAT IS ARTICLE 1427 OF THE CIVIL CODE?

When a minor between eighteen and twenty-one years of age, who has entered into a contract without a consent of a parent or guardian, voluntarily pays a sum or delivers a fungible thing in fulfillment of the obligation, there shall be no right to recover the same from the obligee who has spent or consumed it in good faith.

WHAT IS REPUBLIC ACT NO. 6809?

Republic Act No. 6809 is an act lowering the age majority from twenty-one to eighteen years, amending for the purpose of Executive Order 209, and for other purposes. This means that individuals in the Philippines are considered adults and granted emancipation at the age of eighteen.

WHAT IS EMANCIPATION AND ITS EFFECTS?

Emancipation refers to the parental authority over the person and property of a child. Once the person reaches the age of eighteen, they become qualified and responsible for all acts of civil life, with some exceptions established by existing laws in special cases.

RA No. 6809 also includes the provision of the existing wills, bequests, donations, grants, insurance policies, and similar instruments that contain references and provisions favorable to t minors. The law states that these instruments will not retroact to the prejudice of minors upon the effectivity of the Act.

G.R. 172825

Spouses Miniano dela Cruz and Leta dela Cruz

vs.

Ana Marie Concepcion

Ponente : Associate Justice Diosdado Peralta

Facts:

On March 25, 1996, petitioners (as vendors) entered into a Contract to Sell with respondent (as vendee) involving a house and lot in Cypress St., Phase I, Town and Country Executive Village, Antipolo City for a consideration of P2,000,000.00

The respondent paid the total amount in four equal payments every six months, to wit:

(1) P500,000.00 by way of downpayment;

(2) P500,000.00 on May 30, 1996;

(3) P500,000.00 paid on January 22, 1997; and

(4) P500,000.00 bounced check dated June 30, 1997 which was subsequently replaced by another check of the... same amount, dated July 7, 1997.

However, the petitioners claimed that the respondent had an unpaid obligation of Php 487, 384.15, which includes principal balance and interest, while the respondent claimed that she already paid the balance to certain Adoracion Losloso.

Issues:

Whether or not respondent's obligation had already been extinguished by payment made to the authorized person to receive?

Ruling:

In order to extinguish obligation, payment should be made to the proper person as set forth in Article 1240 of the Civil Code which states that “Payment shall be made to the person in whose favor the obligation has been constituted, or his successor in interest, or any person authorized to receive it”.

Payment made by the debtor to the person of the creditor or to one authorized by him or by the law to receive it extinguishes the obligation. When payment is made to the wrong party, however, the obligation is not extinguished as to the creditor who is without fault... or negligence even if the debtor acted in utmost good faith and by mistake as to the person of the creditor or through error induced by fraud of a third person.

In the case, the payment of the remaining balance of P200,000.00 was not made to the creditors themselves, but to allegedly Losloso as the authorized agent of petitioners. Losloso's authority to receive payment was embodied in petitioners' letter addressed to respondent, dated August 7, 1997. In the same letter, petitioners’ informed the respondent about the remaining balance and the payment for the 1997 real estate taxes. The petitioners also advised the respondent to leave the payment to a certain to Adoracion Losloso as their authorized agent.

The Court ruled that as shown in the receipt signed by the petitioner’s agent and pursuant to the authority granted by petitioners to Adoracion Losloso, payment was made to the latter by the respondent. The Court affirmed the decision of the RTC and the CA that payment had already been made and that it extinguished respondent’s obligations.

[melbejosano]

Round 3 - Article 1212

ARTICLE 1212 STATES THAT EACH ONE OF THE SOLIDARY CREDITORS MAY DO WHATEVER MAY BE USEFUL FOR THE OTHER BUT NOT ANYTHING WHICH MAY BE PREJUDICIAL TO THE LATTER.

Examples:

Ara owes Php 20,000.00 to solidary creditors Bianca and Katherine.

1. Action beneficial to other solidary creditors – If Bianca or Katherine can demand payment from Ara.

2. Action prejudicial to other solidary creditors – If Bianca or Katherine condone or renounces the debt of Ara.

G.R. 151038, January 18, 2012 (Nearest Case)

Petron Corporation, Petitioner

vs.

Spouses Cesar Jovero and Erma F. Cudilla, Spouses Lonito Tan and Luzvilla Samson, and Spouses Rogelio Limpoco and Lucia Josue, as represented by Pio Josue, Respondents

FACTS:

Mr. Rubin Uy entered into a contract as a Retail Dealer of gasoline and petroleum products under Petron Corporation during the period of May 1984 to April 1989. In order to comply with its obligation to dealer petroleum products, Mr. Uy contracted Gale Freight Services, owned and operated by Mr. Jose Villaruz.

In 1987, Mr. Rubin Uy executed a Special Power Attorney (SPA) in favor of Chiong Uy authorizing the latter to manage and administer the gasoline station. After two years, Chiong Uy left the management of the gasoline station to his wife Dortina Uy.

In 1991, one of the employees ordered/requested for the delivery of petroleum products to the station. However, a different truck was used that was specifically not enumerated in the list in the hauling contract.

During unloading of petroleum from the truck to the fill pipe of the gasoline stations’ underground tank, for unknown reason a fire started. The driver of the truck named Pepito Igdamis was nowhere to be found. The bystanders tried to put out the flames. When Pepito returned, he got into the truck and drove in reverse without detaching the hose from the fill pipe. As result, a conflagration started and consumed the nearby properties of the defendants amounting to a sum of Php 6,412,000.00.

ISSUE:

Whether or not the petitioner solidarily liable with the respondents?

HELD:

The Court ruled that:

The petitioner was liable together with the others.

Mr. Villaruz was acting as an agent of Petron. Therefore, under the hauling contract, the acts of Villaruz and his employees are also acts of the petitioner.

Mr. Rubin Uy through his agent Dortina Uy-shared responsibility for the maintenance of the equipment in the gasoline station. Equally negligent in that aspect, thus solidarily liable to respondents for damages caused by fire.

The Court declared the petitioner Petron Corporation, Jose Villaruz, Pepito Igdanis, Rubin Uy, and Dortina Uy as negligent in the conduct of their business activities which led to conflagration at E. Reyes Avenue, Estancia, Iloilo. The Court further ordered the defendants to pay solidarily all the plaintiffs: Spouses Cesar and Emma Jovero, Leonita Tan, Luzvilla Samson, Rogelio and Lucia Limpoco, the actual damages, attorney’s fees, under Article 1216 of the Civil Code of the Philippines.

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Round 2 - Article 1185

ARTICLE 1185 STATES THAT “THE CONDITION THAT SOME EVENT WILL NOT OCCUR AT A DETERMINATE TIME SHALL RENDER OBLIGATION AT A MOMENT OF TIME HAS ELAPSED AND IF HAS BECOME INDUBITABLE THAT AN EVENT WILL NOT OCCUR. IF NO TIME HAS FIXED, THE CONDITION WILL DEEMED FULFILLED AT SUCH TIME AS MAY HAVE PROBABLY BEEN CONTEMPLATED, BEARING IN MIND THE NATURE OF THE OBLIGATION”

Examples:

1. Vince promised to give her daughter Amarah a brand new car if she has not celebrated marriage at 21. Amarah celebrated her 21th birthday as single. Is Vince obliged to give the car to Amarah?

Yes, John is obliged to give the car to Amarah. The condition that some event will not occur at a determinate time has elapsed.

2. Vince convinced her daughter Amarah to take Doctor of Medicine and pass the board examination at the age of 28. However, Amarah shifted to Juris Doctor and became a full pledge Attorney at age 25. Can Amarah claim the car at age 25?

Yes, Amarah can claim the car. The condition has become indubitable that Amarah will pass the board examination for Doctor of Medicine at the age of 28.

3. Vince promised Amarah a free trip to Europe if their family food business was successful. After three years of operation, someone from a food industry conglomerate bought their family food business in a large scale amount that is almost 50% higher than expected if they decided to retain the business. Can Amarah claim her free trip to Europe?

Amarah can now claim her free trip to Europe as the condition was deemed fulfilled at such time as may probably have been contemplated.

CASE DIGEST

SERGIO OSMENA III, Petitioner

vs

POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT CORPORATION, Mr. Emmanuel R. Ledesma, Jr.

SPC POWER CORPORATION AND THERMA POWER VISAYAS INCORPORATED, Respondents

FACTS:

Senator Sergio Osmena III seek to enjoin the sale of Naga Power Plant Complex (NPPC) to respondent SPC Power Corporation (SPC) resulting to latter’s exercise of right to top over Therma Power Visayas Incorporated as the winning bidder, and to declare the stipulation in the lease agreement as void for being contrary to public policy.

The Power Sector Assets and Liabilities Management (PSALM), a government owned and controlled corporation (GOCC), conducted the 3rd round of bidding for the sale of 153 IMW Naga Power Plant Complex . SPC Power Corporation and Therma Power Visayas Incorporated (TPVI) participated and submitted their respective bids. PSALM issued Notice of Award (NOA) to TPVI as the winning bidder, but subject to non-exercise of right to top of SPC Power Corporation in view of the existing lease agreement on the said property. However, PSALM subsequently awarded the project to SPC Power Corporation. For this reason, the TPVI filed the instant Manifestation/Motion that will nullify the SPC’s right to top and the reinstatement of the cancelled NOA in its favor.

ISSUE:

Was the condition to exercise right to top by the SPC Power Corporation valid?

COURT DECISIONS:

The Court granted the motion filed by TPVI after giving due course. The right to first refusal/right to top, granted to SPC Power Corporation under the 2009 Naga LGBT-Land Lease Agreement, was declared null and void. Consequently, the land lease agreement and the Asset Purchase Agreement executed between PSALM and SPC Power Corporation were also nulled and set aside. Further, the NOA was reinstated in favor of TPVI, excluding the portion granted to SPC Power Corporation.

In the case at Bar, the PSALM’s obligation to award the contract in TPVI’s favor was dependent on the non-occurrence of an event, which is the SPC’s right to top. As phrased in the contract, “the approval of sale to TPVI was a conditional one, the consummation of which is dependent on the non-exercise by SPC of its right to top”. Thus, Article 1185 applies. It became apparent that such an event will not occur (the right to top) in view of the declaration of nullity. The conditions deemed complied by operation of law, and the obligation to execute the purchase contracts in favor of TPVI, were due and demandable.

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Round 1: Article 1157

THE ARTICLE 1157 STATES THAT OBLIGATION ARISE FROM:

LAW

CONTRACTS

QUASI-CONTRACTS

ACTS OR OMISSIONS PUNISHED BY LAW

QUASI DELICTS

DISCUSSIONS:

Obligation arise from:

LAW- imposed by laws or statutes.

Examples:

The obligation to pay taxes annually clearly stipulated in the National Internal Revenue Code (R.A. 8424)

The annual submission of Statement of Assets and Liabilities (SALN) of government employees is required by law under Article XI Section 17 of the 1987 Constitution and Section 8 of Republic Act No. 6713, the “Code of Conduct and Ethical Standards for Public Officials and Employees.

CONTRACTS – have the force of law between the contracting parties, which should done in good faith.

Example:

Ms. Ana filed a housing loan in Bank B. Ms. Ana and Bank B entered into a contract. Hence, both parties have respective responsibilities to fulfill during the duration of the contract.

QUASI-CONTRACT - are the judicial relation arising from certain lawful, voluntary and unilateral acts by virtue of which the parties become bound to each other based on the principle that no one shall be unjustly enriched or benefited at the expenses of another.

Two kinds of Quasi-Contracts:

Solutio Indebiti - is the obligation to return money paid by mistake or which is not due. It exist when;

a) Something was received;

b) When there is no right to demand it; and

c) Unduly delivered through mistake.

Example:

Romeo bought goods from Juliet Store. The goods cost $1500. Romeo gave $2000 to the store cashier and received a change of $700. Romeo is duty bound to return the excess of $200 to the store. Otherwise, he will be unjustly enriching himself at the expense of Juliet Store.

2. Negotiorum Gestio exist when one:

a) Voluntary takes charge of the agency or management of the business or property of another; and

b) Without any power from the latter.

Example:

Mr. Juan, the caretaker of the house for rent, received the amount of more than the boarders due. Mr. Juan, without the power or consent of the house owner, increased the rent. Mr. Juan has the obligation to return the excess payment to the boarders.

ACTS OR OMISSIONS PUNISHED BY LAW – arises as consequences of the criminal offense committed. The Article 100 of the Revised Penal Code states that a person criminally liable for a felony is also civilly liable. The Civil Code provides compensation for the wrongful death of a person whether caused by crime

Example:

Mr. X inflicted serious physical injury to Mr.Y. Aside from the criminal charges filed against Mr. X, he will be civilly responsible to pay the medical expenses incurred and other damages of Mr. Y.

QUASI DELICTS or TORTS or culpa aquiliana - arises from the damages caused to another, whether at fault or negligence, gives rise to the obligation to pay for the damages done. There must be no pre-existing contractual relation between the parties.

Example:

Mr. A bitten by my German dog, I as the possessor of that Dog has the obligation to pay the injury of Mr. A as caused by my Dog.

NOTE:

Obligation arising from quasi-contract, delict and quasi delicts are really imposed by law. In other words we have only two sources of obligation which is the LAW and CONTRACTS.

CASE DIGEST

UNITED MUSLIM AND CHRISTIAN URBAN POOR ASSOCIATION, INCORPORATED (UMVUPAI) vs. BRYC-V DEVELOPMENT CORPORATION J. Nachura | July 31, 2009

TOPIC: Contract to Sell, NCC 1479

A promise to buy and sell a determinate thing for a price certain is reciprocally demandable.

FACTS:

In 1991, UMCUPAI, an association duly registered at the Securities and Exchange Commission (SEC) and duly accredited with the Presidential Commission for the Urban Poor approached the Sea Foods Corporation (SFC) for the purchase Lot No. 300, located in Barangay Calarian, Zamboanga City.

The UMCUPAI, to enable to avail the Community Mortgage Program, approached the Mayor of Zamboanga City, to stand as the “Originator” for the acquisition of the said property at the Home Mortgaged and Financing Corporation (HMFC).

As such, the parties executed a Letter of Intent to Sell by SFC, Letter of Intent to Purchase by UMCUPAI, and the Deed of Absolute Sale signed and delivered with the title upon full payment of the price. However, the intended sale was derailed due to UMCUPAI’s inability to secure loan from the NHMF.

Another round of negotiation took place seeking the division of Lot No. 300 into three portions. In December 1994, Lot No. 300 was subdivided into 3 parts:

Lot No. 300-A was purchased by UMCUPAI for 4.3M in January 1995;

Lot No. 300-B became a road and was donated by SFC to the LGU; and

Lot No. 300-C– was agreed to be purchased by the UMCUPAI for the next another 3 months

However, UMCUPAI failed to purchase within the agreed period. The SFC sold Lot No. 300-C to respondent BRYC-V Development Corporation for 2.5M. A year later, UMCUPAI filed a complaint at the Regional Trial Court (RTC) against SFC and BRYC-V Development Corporation seeking to annul the sale of Lot No. 300-C. According to UMCUPAI, the alleged sale violated the valid and subsisting agreement between SFC and UMCUPAI as embodied in the Letter of Intent, issued prior to the sale over BRYC Development Corporation.

ISSUE :

Was the letter of intent to sell and letter of intent to buy a bilateral reciprocal contract within the meaning of or contemplation of Article 1479, first paragraph of the Civil Code of the Philippines?

COURT DECISIONS:

The Regional Trial Court (RTC) dismissed the UMCUPAI’s complaint due to the following reasons:

The letter of Intent was executed to facilitate the approval of UMCUPA’s loan from HMF for its intent to purchase Lot No. 300.

The RTC concluded that the Letter of Intent was neither a promise, nor an option contract, or an offer under NCC 131, or a bilateral contract to sell and buy.

The RTC further quoted that “a mere “intention” cannot give rise to an obligation to give, to do or not to do. A Letter of Intent is not a contract between the parties thereto because it does not bind one party, with respect to the other, to give something, or to render some service”.

In the appeal of UMPAUPAI, the Court of Appeals (CA) affirmed the decision of the RTC in toto.

With finality, the Supreme Court (SC) also held that the Letter of Intent was neither a contract to sell under NCC 1479 nor a conditional contract of sale under NCC 1458.

IT IS NOT A CONDITIONAL CONTRACT OF SALE: Nowhere in the Letter of Intent does it state that SFC relinquishes its title over the subject property, subject only to the condition of complete payment of the purchase price.

IT IS NOT A CONTRACT TO SELL: Also, nowhere in the Letter of Intent does it state, at the least, that SFC, although expressly retaining ownership thereof, binds itself to sell the property exclusively to UMCUPAI.

RATHER, THE LETTER OF INTENT TO BUY AND SELL is just that – a manifestation of SFC’s intention to sell the property and UMCUPAI’s intention to acquire the same.

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Intrinsic Validity vs Extrinsic Validity

The distinctive difference between the intrinsic validity of a will refers to the order and allocation of successional rights in accordance with law while extrinsic validity refers to determination of the authenticity of the will and the execution by the decedent.

Further, intrinsic validity follows the laws based on the following: 1) the time of the testator’s death to govern the succession rights, and 2) the place or the country where the national law of the testator to govern, regardless of the place where the will was executed or where the testator died.

On the other hand, an extrinsic validity is governed by the law of the country where the will was executed and presented for probate. In case, if the testator is a Filipino, he can observe the Philippine law or the law of the country where he executes the will. A foreigner living abroad can follow the law of his domicile. In case the testator is a foreigner in the Philippines, he can either follow the law of his domicile or the Philippine law.

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Article 132. The Rules of Court on the administration of estates of the deceased persons shall be observed in the appraisal and sale of properties of the conjugal property, and other matters which will expressively determined in this chapter.

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Case Digest:

Melecio Domingo v. Spouses Genaro and Elena Molina, G.R. No. 200274, April 20, 2016

Ponente: Associate Justice Arturo D. Brion

FACTS:

In 1951, spouses Anastacio and Flora Domingo bought a property in Camiling, Tarlac. The property relation of spoused Anatacio and Flora was governed by the conjugal partnership of gains. Anastacio usually borrowed money from the respondent Spouses Genaro and Elena Molina through out his lifetime. Ten years after Flora’s death, Anastacio sold his interest over the land to the spouses Molina to answer for all his debts. The sale of Anastacio’s interest which covers entire one-half undivided portion of the land to the spouses Molina, was registered in a Transfer Certificate of Title. Melecio, one of the children of Anastacio and Flora, filed a Complaint for Annulment of Title and Recovery of Ownership (Complaint) against the spouses Molina. Melecio claimed that Anastacio only gave the subject property to the spouses Molina to serve as collateral for the money that Anastacio borrowed from them. The spouses Molina asserted that Anastacio surrendered the title to the subject property to them to pay his debts that made them the owner of the half of the land. The spouses Molina also asserted that Melecio knew of the disputed sale since he always accompanied his father Anastacio whenever he will borrow money.

ISSUE:

Whether the sale of a conjugal property without the wife’s consent is valid and legal?

HELD:

YES, the Court ruled that the sale of conjugal property was valid even without the consent of the spouse. The conjugal partnership of Anastacio and Flora was dissolved when Flora died pursuant to Article 126 (1) of the Family Code. The surviving spouse has an actual and vested one-half undivided share from the subject property. Thus, Anastacio had the right to freely sell and dispose of his undivided interest in the subject property, but not the interest of his co-owners. Consequently, Anastactio’s sale to the spouses Molina without the consent of the other co-owners was not totally void, for Anastacio’s rights or a portion thereof were thereby effectively transferred, making the spouses Molina a co-owner of the subject property to the extent of Anastacio’s interest.

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Paraphernal Property

Paraphernal property is the property that belongs solely to a wife and is not under the control of her husband or otherwise known as the extradotal property. This property is separate from the dowry that a wife brings to a marriage.

On the other hand, the property that belongs solely to a husband and not under the control of his wife is called Capital property.

When the new Family Code took effect on August 3, 1988, the Paraphernal Property and Capital Property are then called as Exclusive Property. In exclusive property, either of spouses can sell or mortgage own properties without the marital consent of the other spouse. In case of death of the spouse owner, the exclusive property will be divided between the wife as the compulsory heir, children, father and mother in case of predeceased, or brother or sister in case no children or no living parents.

For example, if a husband inherits a house from his father, that house would be considered capital/exclusive property because it is solely owned and controlled by the husband. The wife cannot claim in anyway unless his husband died.

In case of business, if a wife starts and runs on her own, the assets and the profits of the business would be considered paraphernal property.

[melbejosano]

Presumptive legitime is required to be delivered to the common children of the spouses when the marriage is annulled or declared void ab initio or when the conjugal partnership or absolute community is dissolved as in the case of legal separation. In the division of absolute community property, one-half of the property from each spouses share shall be given to their children. It is right of the children to claim their share from the community property. Children may bring in court if one or both parents will refused to give the right proportion in the community property. Further, failure of the parents to deliver the presumptive legitime will make their subsequent marriage null and void under Article 53 of the Family Code.

[melbejosano]

Round 5:

Section 5. Dissolution of Absolute Community Regime

Article 99. The absolute community terminates:

1. Upon death of either of the spouse;

2. When there is a decree of legal separation;

3. When the marriage is annulled and when void; or

4. In the judicial separation of properties of marriage under Articles 134 to 138.

The termination of community property should be registered so that the third party will not be prejudiced when the surviving spouse decides to enter into a contract or sells properties from the community property. If actions is to be brought, it must be done with the surviving spouse.

The termination of community property in legal separation, the modes of termination of the absolute community properties are exclusive in nature, and shall require approval of the court. Any change or modification after the declaration of marriage will require judicial intervention.

In the dissolution of community property, whatever is acquired by the spouses thereafter belongs to him/her exclusively. At the same time, debts contracted are answerable by him/her exclusively.

_____________________

G.R. 7397, December 11, 1916

Case of Amparo Nable Jose, et.al., Standard Oil Insurance Company of New York and Carmen Castro, Plaintiffs-Appellants

v.

Mariano Nable Jose, et.al., Defendants-Appellees

Facts:

In 1880, Mariano Nable Jose got married to Dona Paz Borja and had four children. Dona Paz died intestate in 1898 and left her husband and children as her heirs. Since the death of the spouse, the community partnership between Mariano and Dona Paz has not been liquidated, and no proceedings was issued for the judicial administration of the properties.

Mariano got in indebted and mortgaged the properties to Amparo Nable Jose de Lichauco and Asuncion Nable Jose, Standard Oil Company. The properties were also encumbered to Carmen Castro. The children as heirs had no knowledge about the mortgages nor informed by their father. In order to recover payments from debts, the Standard Oil Company filed actions against Mariano.

Issue:

Is the sale or mortgaged by the surviving spouse of the community property valid?

Held:

Yes, the court held that it is valid.

In law, the court held that the petitioner, Mariano, is clothed by exclusive possession and insignia of power in the disposal of properties. It imposes rights and duties to sell all or part of the community property.

The Court further held that the proceeds of the sale of the property should be applied as payment to the third parties, Amparo Nable Jose de Lichauco and Asuncion Nable Jose of the Standard Oil Company, and Carmen Castro.

For the share of the heirs, Articles 1424 and 1426 of the Civil Code should also apply.

Article 1424 states that after deductions of inventoried properties, the remainder of the states shall composed the assets of the conjugal property.

Article 1426 states that the remainder of the assets shall be divided, shared and likewise shared alike to the husband, the wide, and to the respective heirs.

In the case, Mariano acted fraudulently when he took away the proceeds of the community property, which should be divided, shared and shared alike to the husband, the wife, and to respective heirs. The heirs tried to recover the properties by they failed. The court erred to hold the proceeds of the sale of the remaining properties after deductions of debts.

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Round 4: Article Assisgnment

Article 65: If the spouses should reconcile, a corresponding joint manifestation under oath duly signed by them shall be filed with the court in the same proceeding for legal separation.

The joint manifestation of reconciliation shall contain the following information:

1. The details of the marriage and separation case;

2. The intent to inform the honorable court that parties reconciled and mutually agreed to terminate the legal separation case;

3. The motion to revive the property regime;

The counsel of the respondent will submit the Oath of Manifestation on a specified date and time at the same court where the legal separation proceeding.

______________________________

Case of Sabalones vs Court of Appeals, G.R. 106169, February 14, 1994

Samson T. Sabalones, Petitioner

vs.

Court of Appeals and Remedios Gaviola-Sabalones, Respondents

Facts:

The subject of the petition is the preliminary injunction issued by the respondent court pending resolution of a case on appeal.

The spouses, Samson and Remedios, were married and acquired several assets through out their marriage. Upon Samson’s retirement as an Ambassador in 1985, he came back home to the Philippines, but not to his wife and children. Four years later, Samson filed an action for judicial authorization to sell the building and lot located in Eisenhower Street, Greenhills, San Juan, Metro Manila, belonging to the conjugal partnership. According to Samson, he will use the proceeds for his medical treatment and hospitalizations.

Remedios, the respondent, opposed the authorization. In her counterclaims, she narrated that Samson had not returned to his legitimate family since his retirement, resides in Don Antonio Heights, Fairview, Quezon City, with Thelma Cumareng and their three children, and she and her children solely depend on the rental proceeds from another property in Forbes Park, Makati City, for support. A prayer was added in the counterclaim that the court grant the legal separation and liquidation of conjugal properties, with forfeiture of the husband’s share because of the commission of adultery.

The court found Samson was indeed contracted bigamous marriage in 1981 with Thelma Cumareng, and lived together in one house since his return to the country. The court issued a decree of legal separation, with forfeiture of his share from the conjugal properties. The respondent filed a writ of preliminary injunction due to the petitioner’s interference in the administration of their properties in Greenhills and Forbes Park. Samson further executed quitclaim on one valuable properties in United States, which was prejudicial to his legitimate wife and children.

The court then issued the preliminary injunction on April 7, 1992, which Samson assailed citing the provisions of Article 124 and Article 61, that the court failed to assign administrator of the conjugal properties.

Issue: Is contention of Samson that the court failed to issue administrator on the conjugal properties?

Held:

The Court finds no merit in the petition.

The Court held that the express designation of properties to appoint Remedios as the administrator of the properties, was still pending in Court. The Court merely allowed Remedios to continue his role as administrator in reference with the preliminary injunction issued by the Court. Since Samson committed adultery and was denied by Court to get any shares from the community property in view of his violation in Article 63 (2) of the Civil Code. Hence, he cannot served as administrator from the properties where he was denied to obtain any part from the community property.

[melbejosano]

Round 3: Article Assignment

Article 30:

The original of the affidavit required in the last preceding article, together with the legible copy of the marriage contract, shall be sent by the person solemnizing the marriage to the local civil registrar of the municipality where it was performed within the period of thirty (30) days after the performance of the marriage.

Additional Explanation:

It is the duty of the solemnizing officer to report the marriage to the Local Civil Registrar (LCR) for proper registration and endorsement to the Philippine Statistical Authority (PSA).

A copy of the Certificate of Marriage (COM) maybe requested at the LCR in the city or municipality where the marriage was solemnized and registered. The LCR should be able to provide a copy of COM, but not a PSA-certified copy. In case the LCR unable to give a copy of the COM, the marriage contract was not duly forwarded by the solemnizing officer to LCR for proper registration. A PSA-certified copy of COM can be requested or obtained 3-6 months after the marriage took place.

If the COM was not submitted by the solemnizing officer to the LCR for proper registration and endorsement to the PSA does not necessarily mean that the marriage is no longer valid. It only need proper registration at the LCR. Failure to register the COM within the 15-day reglementary period, the COM can still be filed under delayed registration.