1. Hererra v Petro Phil 146 SCRA 385 2. Ronio v Gomez 83 PHIL 890 3. De Lima v Laguna? 160 SCRA 70 4.

Nakpil v Ca 160 SCRA 334 5. Sangrada v Villanueva __ SCRA 215 6. Insular v Spouses Salazar 159 SCRA 133 7. Equitable v Liwanag 32 SCRA 293 8. Heniza v Sy 6 SCRA 20 9. Manila Trading v Tamaraw 47 PHIL 513 10. Delgado v Alfonso 44 PHIL 739 11. Lotero v Siu Liong 54 PHIL 272 8Sangrador vs. Valderrama, 168 SCRA 215.

HERRERA vs PETROPHIL CORP. [G.R. No. L-48349, December 29, 1986] CRUZ, J.


On December 5, 1969, Herrera and ESSO Standard, (later substituted by Petrophil Corp.,) entered into a lease agreement, whereby the former leased to the latter a portion of his property for a period of 20yrs. subject to the condition that monthly rentals should be paid and there should be an advance payment of rentals for the first eight years of the contract, to which ESSO paid on December 31, 1969. However, ESSO deducted the amount of 101, 010.73 as interest or discount for the eight years advance rental.

On August 20, 1970, ESSO informed Herrera that there had been a mistake in the computation of the interest and paid an additional sum of 2,182.70; thus, it was reduced to 98, 828.03.

As such, Herrera sued ESSO for the sum of 98, 828.03, with interest, claiming that this had been illegally deducted to him in violation of the Usury Law.

and any reduction thereof.  To constitute usury. and something must be exacted for the use of the money in excess of and in addition to interest allowed by law. ISSUE: W/N the contract between the parties is one of loan or lease. Thus. RULING:  Contract between the parties is one of lease and not of loan. There was neither loan nor forbearance but a mere discount which the plaintiff-appellant allowed the defendant-appellee to deduct from the total payments because they were being made in advance for eight years. express or implied.  The difference between a discount and a loan or forbearance is that the former does not have to be repaid. the defendant-appellee was discharging its obligation in advance by paying the eight years rentals. Judgment on the pleadings was rendered in favor of ESSO. The discount was in effect a reduction of the rentals which the lessor had the right to determine. would not contravene the Usury Law. On the contrary. and it was for this advance payment that it was getting a rebate or discount."  It has been held that the elements of usury are (1) a loan.  There is no usury in this case because no money was given by the defendant-appellee to the plaintiffappellant. by any amount." Nowhere in the contract is there any showing that the parties intended a loan rather than a lease. the matter was elevated to the SC for only questions of law was involve. ESSO argued that amount deducted was not usurious interest but rather a discount given to it for paying the rentals in advance. it must be repayable absolutely and in all events. The provision for the payment of rentals in advance cannot be construed as a repayment of a loan because there was no grant or forbearance of money as to constitute an indebtedness on the part of the lessor. nor did it allow him to use its money already in his possession. It is clearly denominated a "LEASE AGREEMENT. or agreed to . (2) an understanding between the parties that the money lent shall or may be returned. the loan must be of money or something circulating as money. The loan or forbearance is subject to repayment and is therefore governed by the laws on usury. "there must be loan or forbearance. that for such loan a greater rate or interest that is allowed by law shall be paid.

ET AL.  petitioner.  RESOLUTION OF SC:  The SC ruled that that the contract between the parties is an aleatoty contract.00 “mickey mouse  ) will  be paid in “the currency  prevailing by the end of the s  tipulated period of one year.00 in Philippine currencywhich was then the prevailing currency at the time of payment.The eventual gain of Gomez is not  “  interest  ”  within the meaning of the Usury law.000.public order and good morals  since his loan then of P4.  respondents. Subsequently. as the case may be. Cristobal Roño received as a loan fromJose L.000. 1944.” The civil cod  e supports such agreement when it says "obligationsarising from contracts shall have the force of law between the contracting parties andmust be performed in accordance with their stipulations" (Article 1091).” .  G. Rono insists that the contract taken in favor of respondent is contrary to law. and (4) a corrupt intent to take more than the legal rate for the use of money loaned.000.In the first place. because on the basis ofcalculations by Government experts he only received the equivalent of P100 Philippinepesos and now he is required to give four thousand pesos or interest greatly in excessof the lawful rates.00 of the Philippine currency which is the prevailing currencyat the time of payment.   CONTENTION OF THE RESPONDENT:  That both parties agreed that the loanedamount of  P4. Such is evidenced by the fact that in hispromissory note. a collection suit was filed by respondent Gomez against petitioner Rono to collect  the latter’s debt.. No. The contractof loan is under the condition that said loan  will not earn interest  and that it will be paid  in the currency then prevailing  one year after the execution of the contract. vs. 1949   CRISTOBAL ROÑO.be paid. Gomez P4.R. GOMEZ.00 “mickey mouse” money  is equivalent only to P100. Contending suchdecision. The courtordered Rono to pay the respondent an amount of P4. Rono is not paying an interest.”  Furthermore.000. both parties clearly agreed at the time of the execution of thecontract that the loaned money (  P4. he  indicated that the money loaned “will not earn any interest.000. it is safe to affirm that no case of usury can be declared. Unless these four things concur in every transaction.00 in Japanese fiat money (mickey mouse money).  *Usurious Transactions #6 (round 2)STATEMENT OF FACTS:  On October 5.00 mickey mouse money be paid in “the currency prevailing by theend of one year.  JOSE L. L-1927 May 31.   CONTENTION OF THE PETITIONER:   Roño asserts that the decision of the trial courtruling in favor of respondent is contrary to the Usury law. After ayear. t  he trial court ruled in favor of Gomez.

Hence this petition.000. petitioners contend that the ruling of she Appellate Court departs from the consistent rulings of this court that the award of the legal rate of interest should be computed from the promulgation of the decision of the tonal court. 13 4           We hold that the legal interest of six percent (6) on the amounts adjudged in favor of petitioners should start from the time of the rendition of the trial court's decision on December 27. The assignment of errors raised the following issues. he can do so only to 6 sustain the judgment on other grounds but not to seek modification or reversal thereof. are now precluded from questioning the ruling of the Court of Appeals. the promulgation of the decision of the Court of Appeals. the date of the decision of the Court of Appeals. for in 7 such case he must appeal. However. the subject decision is modified in that the legal interest on the damages awarded to petitioners commences from the date of the decision of the court a quo until actual payment while the civil indemnity for the death of Petra de la Cruz is increased to P 30. the effectivity of 5 the interest should not be rolled back to the time the decision of the court a quo was rendered. Petitioner potenciano Requijo as heir of the deceased Petra de la Cruz further sought an increase in the civil indemnity of P3. Court will start to run from the date of the decision of the trial court on December 27. that the increased intrinsic value and purchasing power of the current moneyis consequence of an event (change of currency) which at the time of the contractneither party knew would certainly happen within the period of one year. erred in granting legal interest on damages to start only from the date of its decision instead of from the date of the trial court's decision. 1963 instead of January 31.000. if any.000.00 to P 12. and while he may make counter assignment of errors. which step was obviously dilatory and oppressive of the rights of the said claimants: that the case had been pending in court for about 30 years from the date of the accident in 1958 so that as an exception to the general rule aforestated. should 12 be afforded equitable relief by the courts as it must be vigilant for their protection. We find merit in the petition. The Appellate Court denied the motion for reconsideration holding that since the plaintiffs did not appeal from the failure of the court a quo to award interest on the damages and that the court on its own discretion awarded such interest in view of Art.   The devaluation of the Mickey mouse money is due to an event unforseable byany man.000. whose decision is brought up on appeal. 2210 of the Civil Code. 1972. . Moreover.000 to P12. to wit: 1) Whether or not the Court of Appeal. It is true that the rule is well-settled that a party cannot impugn the correctness of a judgment not appealed from by him.00. the said heirs who did not appeal the judgment. Under the first issue. The claim for legal interest and increase in the indemnity should be entertained in spite of the failure of the claimants to appeal the judgment. the petition is hereby GRANTED. SP-240) from P3.00. under the circumstances of this case where the heirs of the victim in the traffic accident chose not to appeal in the hope that the transportation company will pay the damages awarded by the lower court but unfortunately said company still appealed to the Court of Appeals. 1963 instead of January 31. Thus.00. the contract inquestion is legal and obligatory and is not subject to the operation of the Usury law DELIMA VS LAGUNA TAYABAS Petitioners moved for a reconsideration of this decision seeking its modification so that the legal interest awarded by the Appellate. 1972. bothparties subjected their rights and obligations to that contingency. WHEREFORE. Respondents counter that petitioners having failed to appeal from the lower court's decision they. A party who does not appeal from the decision may not obtain any affirmative relief from the appellate court other than what he has obtained from the lower court. 2) Whether or not the Court of Appeals erred in not increasing the indemnity for the death of Petra de La Cruz (in Civil Case No.

00 in favor of the PBA (L. UNITED's Brief as Petitioner. PBA's No. p. Vol. 19). PBA's No. (UCI). as We do hereby impose.000.47851. al. PBA filed a complaint for damages and thus was appealed to the CA where judgment was modified as what the RTC rendered in favor of the plaintiff. August 2. Commissioner sustained that the building was caused directly by the earthquake and maintained that the specification were not followed. PBA constructed a building whereby the construction was undertaken by United Construction Inc. 1723. 92). p. Civil Code.00 inasmuch as it was not initially a total loss. therefore there should be no question that NAKPIL and UNITED are liable for damages because of the collapse of the building. The PBA in its brief insists that the proper award should be P1. vs. 6. the decision appealed from is hereby MODIFIED and considering the special and environmental circumstances of this case. plus unrealized rental income for onehalf year. Therefore. Supra. earthquake hit Manila and thus damaging properties where the building of PBA was one of which. 19). In the RTC.000.671. Approved by the president of PBA. The PBA further urges that the unrealized rental income awarded to it should not be limited to a period of one-half year but should be computed on a continuing basis at the rate of P178. November 29 of that same year. 10) indemnity in favor of the . However. 1968. plaintiff PBA filed suit for recovery of damages against the UCI. We deem it reasonable to render a decision imposing. Consolidated Case Nakpil & Sons et. the plans and specification were prepared by Nakpil & Sons.000. 1986 160 SCRA 334 Ponented: Justice Paras Facts: In the RTC of Manila. WHEREFORE. 1 Assignment of Error.000. 25). thus if in the concurrence of such event there be fraud. delay in the performance of the obligation. p.76 a year until the judgment for the principal amount shall have been satisfied L. while the trial court awarded the PBA said amount as damages. Issue(SC issue): Whether or not an Act of God-fortuitous event. Court of Appeals October 3. p. The negligence of the defendant was shown when and proved that there was an alteration of the plans and specification that had been so stipulated among them. p. p. exempts liability from parties who are otherwise liable because of their negligence? Held: Although the general rule for fortuitous events stated in Article 1174 of the Civil Code exempts liability when there is an Act of God. 1970 (L-47896. The Court of Appeals affirmed the finding of the trial court based on the report of the Commissioner that the total amount required to repair the PBA building and to restore it to tenantable condition was P900. the obligor cannot escape liability therefore there can be an action for recovery of damages. by which in March 3.00 representing the damage suffered by the PBA building as a result of another earthquake that occurred on April 7.47896. 1969 filed their written stipulation. while both the NAKPILS and UNITED question the additional award of P200. the Court of Appeals modified the amount by awarding in favor of PBA an additional sum of P200. I.830. technical issues were submitted to Commissioner Hizon and as for other issues the Court resolved. The UCI in turned filed suit against Nakpil & Sons. 11 Assignment of Errors. NAKPIL's Brief as Petitioner. negligence.00 representing the total value of the building (L-47896. upon the defendant and the third-party defendants (with the exception of Roman Ozaeta) asolidary (Art.This judgment is immediately executory and no motion for extension of time to file motion for reconsideration shall be entertained.

400. therefore. where both parties prevaricated. A provision of a contract which calls for an increase in price in the event of an increase in certain costs. We are convinced that the trial court erred in finding that the loan was P1.400.000. the enforcement of such stipulations are subject to certain conditions. But neither do We believe the plaintiff Evelyn Sangrador's allegation that besides the sum of P1. Solidary costs against the defendant and third-party defendants (except Roman Ozaeta).Philippine Bar Association of FIVE MILLION (P5. Insular Bank of Asia and AmericaVs.000 as stated in the promissory note (Exh. B) and deed of mortgage.000 that was added to the principal represents a hidden interest charge for the promissory note contains no express provision fixing the rate of interest on the loan.00) Pesos as and for attorney's fees. Obviously. the P400. she also gave them P400.000. SANGRADOR VS VALDERAMA After carefully reviewing the evidence. Like the trial court.00) Pesos to cover all damages (with the exception of attorney's fees) occasioned by the loss of the building (including interest charges and lost rentals) and an additional ONE HUNDRED THOUSAND (P100.000.000. opposite of de-escalation clause. This is a case. We do not believe defendant Valderrama's allegation that he did not notice that the amount stated in the promissory note was P1. For example.000. the total sum being payable upon the finality of this decision.00 in cash without receipt. an escalation clause may specify that rent due will increase with inflation.000 admittedly received by the defendants and evidenced by checks and receipts.000. until demands for payment were sent to him by the plaintiffs' counsel. Upon failure to pay on such finality.000. . instead of only P1. However. twelve (12%) per cent interest per annum shall be imposed upon afore-mentioned amounts from finality until paid.000. Spouses Salazar (159 SCRA 133)I t i s t h e r u l e t h a t e s c a l a t i o n c l a u s e s a r e v a l i d s t i p u l a t i o n s i n commercial contracts to maintain fiscal stability and to retain the valueof money on long term contracts.

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