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I

Yes, Ildefonso must respect the lease contracts between Jude and his tenants. While it is true that the said lease
contracts were not registered and annotated on the title to the property, Ildefonso is still not an innocent purchaser for
value. He ought to know the existence of the lease because the building was already occupied by the tenants at the time
he bought it. Applying the principle of caveat emptor, he should have checked and known the status of the occupants of
their right to occupy the building before buying it.

II

Yes, Rommel may be held liable for damages if he fails to prove that he exercised the diligence of a good father of a
family (Art. 2180, par 5, NCC) in selecting and supervising his family driver. The owner is presumed liable unless he
proves the defense of diligence. If the driver was performing his assigned task when the accident happened, Rommel
shall be solidarily liable with the driver. In case the driver is convicted of reckless imprudence and cannot pay the civil
liability, Rommel is subsidiarily liable for the damage awarded against the driver and the defense of diligence is not
available.

Yes, my answer would be the same. Rommel, who was in the car, shall be liable for damages if he could have prevented
the misfortune by the use of due diligence in supervising his driver but failed to exercise it (Art. 2184, NCC). In such case,
his liability is solidary with his driver.

III

The case must be dismissed. Julian, who is a naturialized Filipino citizen and to whom the property was allocated in a n
extra-judicial partition of the estate, is now the owner of the property. The defect in ownership of the property of
Julian’s alien father has already been cured by its transfer to Julian. It has been validated by the transfer of the property
to a Filipino citizen. Hence, there is no more violation of the Constitution because the subject real property is now
owned by a Filipino citizen (Halili v. CA, 287 SCRA 465, [1998]). Further, after the lapse of 35 year, laches has set in and
the motion to dismiss may be granted, for the failure of Luciano to question the ownership of Chua before its transfer of
ownership to Julian.

IV

Yes, the action of for rescission of the contract of lease and for damages will prosper. Under Article 1659 of the Civil
Code, "if the lessor or the lessee should not comply with the obligations set forth in Articles 1654 and 1657, the
aggrieved party may ask for rescission of the contract and indemnification for damages, or only the latter, allowing the
contract to remain in force." Article 1649 of the same Code provides that "the lessee cannot assign the lease without the
consent of the lessor, unless there is a stipulation to the contrary."
Consent is necessary because assignment would cause novation by the substitution of one of the parties. (Bangayan v.
Court of Appeals, G.R. No. 123581, August 29, 1997) However, the rule is different in the case of subleasing. When there
is no express prohibition in the Contract of Lease, the lessee may sublet the thing leased. (Art. 1650, Civil Code). In the
given case, when Joel assigned the lease to Ernie, the same was done without the consent of Victor. The assignment is
void. However, there is no indication that in the written contract of lease between Victor and Joel, that subleasing the
premises is prohibited. Hence, the sublease of Joel with Conrad is valid. In view of the foregoing, Victor can file the case
of rescission and damages only against Joel and Ernie but he cannot include Conrad.

Rescission of the lease necessarily requires the return of the thing to the lessor. Hence, the judgment granting rescission
of the contract should also order the lessee to vacate and return the leased premises to the lessor. However, since the
sublessee can invoke no right superior to that of his sublessor, the moment the sublessor is duly ousted from the
premises, the sublessee has no leg to stand on. The sublessee's right, if any, is to demand reparation for damages from
his sublessor, should the latter be at fault. (Heirs ofSevilla v. Court of Appeals G.R. No. 49823, February 26, 1992).

V
No, the agency in the case presented is one which is coupled with an interest. As a rule, agency is revocable at will
except if it was established for the common benefit of the agent and the principal. In this case, the interest of the
lawyer is not merely limited to his commission for the sale of the property but extends to his right to collect his unpaid
professional fees. Hence, it is not revocable at will. (Article 1927)

Vi

No. Atty. Cruz is not correct. At first glance, it may appear that Atty. Cruz is the one who has the better right because he
first took possession of the property. However, a lawyer is prohibited under Art 1491 of the Civil Code from acquiring
the property and rights which may be the object of any litigation in which they may take part by virtue of their
profession. While the suit is for annulment of MARRIAGE (FAMILY CODE) and it may be urged that the land itself is not
the object of the litigation, the annulment of MARRIAGE (FAMILY CODE), if granted, will carry with it the liquidation of
the absolute community or conjugal partnership of the spouses as the case may be (Art. 50 in relation to Art 43 of the
Family Code). Richard purchased the land with his lotto winnings during the pendency of the suit for annulment and on
the assumption that the parties are governed by the regime of absolute community or conjugal partnership, winnings
from gambling or betting will form part thereof. Also, since the land is part of the absolute community or conjugal
partnership of Richard and Rica, it may not be sold or alienated without the consent of the latter and any disposition or
encumbrance of the property of the community or the conjugal property without the consent of the other spouse is void
(Art 96 and Art 124, Family Code).

VII

The two remaining partners, A and B, are liable. When any partner dies and the business is continued without any
settlement of accounts as between him or his estate, the surviving partners are held liable for continuing the business
despite the death of C (Art 1841, 1785, par 2, and Art 1833 of NCC).

VIII

Yes, Tony may file an action against Premium Bank for damages under Art. 2176. Even if there exists a contractual
relationship between Tony and Premium Bank, an action for quasi-delict may nonetheless prosper. The Supreme Court
has consistently ruled that the act that breaks the contract may also be a tort. There is a fiduciary relationship between
the bank and the depositor, imposing utmost diligence in managing the accounts of the depositor. The dishonor of the
check adversely affected the credit standing of Tony, hence, he is entitled to damages (Singson v. BPI, G.R. No. L-24932,
June 27, 1968; American Express International, Inc. v. IAC, G.R. No. 72383, November 9, 1988;Consolidated Bank and
Trust v. CA, G.R. No. L-70766 November 9, 1998).

IX

Yes, the action will prosper. Article 2201 of the Civil Code entitles the person to recover damages which may be
attributed to non-performance of an obligation. In Alitalia Airways v. Court of Appeals (G.R. No. 77011, July 24, 1990),
when an airline issues ticket to a passenger confirmed on a particular flight, a contract of carriage arises and the
passenger expects that he would fly on that day. When the airline deliberately overbooked, it took the risk of having to
deprive some passengers of their seat in case all of them would show up. For the indignity and inconvenience of being
refused the confirmed seat, said passenger is entitled to moral damages. In the given problem, spouses Almeda had a
booked roundtrip business class ticket with Pinoy Airlines. When their tickets were upgraded to first class without their
consent, Pinoy Airlines breached the contract. As ruled in Zulueta v. Pan American (G.R. No. L-28589, January 8, 1973), in
case of overbooking, airline is in bad faith. Therefore, spouses Almeda are entitled to damages. The action may or may
not prosper. Moral damages include physical suffering, mental anguish, fright, serious anxiety, besmirched reputation,
wounded feelings, moral shock, social humiliation, and similar injury. Although incapable of pecuniary computation,
moral damages may be recovered if they are the proximate result of the defendant's wrongful act or omission. Moral
damages predicated upon a breach of contract of carriage are recoverable only in instances where the carrier is guilty of
fraud or bad faith or where the mishap resulted in the death of a passenger. (Cathay Pacific Airways,
Ltd. v. Court of Appeals, G.R. No. 60501, March 5, 1993) Where there is no showing that the airline acted fraudulently or
in bad faith, liability for damages is limited to the natural and probable consequences of the breach of the contract of
carriage which the parties had foreseen or could have reasonably foreseen. In such a case the liability does not include
moral and exemplary damages.
In the instant case, if the involuntary upgrading of the Almedas' seat accommodation was not attended by fraud or bad
faith, the award of moral damages has no leg to stand on.
Thus, spouses would not also be entitled to exemplary damages. It is a requisite in the grant of exemplary damages that
the act of the offender must be accompanied by bad faith or done in wanton, fraudulent or malevolent manner. (Morris
v. Court of Appeals, G.R. No. 127957, February 21, 2001) Moreover, to be entitled thereto, the claimant must first
establish his right to moral, temperate, or compensatory damages. (Art. 2234, Civil Code) Since the Almedas are not
entitled to any of these damages, the award for exemplary damages has no legal basis. Where the awards for moral and
exemplary damages are eliminated, so must the award for attorney's fees be eliminated. (Orosa v. Court of Appeals, G.R.
No. 111080, April 5, 2000; Morris v. Court of Appeals, G.R. No.
127957, February 21, 2001) The most that can be adjudged in their favor for Pinoy Airlines' breach of contract is an
award for nominal damages under Article 2221 of the Civil Code.
(Cathay Pacific Airways v. Sps. Daniel & Maria Luisa Vasquez, G.R. No. 150843, March 14, 2003)
However, if spouses Almeda could prove that there was bad faith on the part of Pinoy Airlines when it breached the
contract of carriage, it could be liable for moral, exemplary as well as attorney's fees.