G.R.

No. L-15127 May 30, 1961

EMETERIO CUI
vs.
ARELLANO UNIVERSITY

CONCEPCION, J

Facts:
Emeterio Cui enrolled in the defendant university where plaintiff finished his law
studies in the up to and including the first semester of the fourth year. During all
the school years in which plaintiff was studying law in defendant Law College, he
was awarded scholarship grants and his semestral tuition fees were returned to
him after ends of the semester. Plaintiff left the defendant's law college and
enrolled for the last semester of his fourth year law in the college of law of the
Abad Santos University graduating from the college of law of the latter university.
He applied to take the bar examination in which he needed the transcripts of his
records in defendant Arellano University. The defendant refused until after he had
paid back the P1,033 87, noting the contract that he signed which stated that in
consideration of the scholarship granted to him by the University, he waives his
right to transfer to another school without having refunded to the defendant the
equivalent of the scholarship cash and followed by Memorandum No. 38 that the
Director of Private Schools issued.
Issue:
Whether or not the contract between Cui and the respondent university, whereby
the former waives his right to transfer to another school without having refunded
to the defendant the equivalent of the scholarship cash valid or not?
Held:
The contract of waiver between the plaintiff and respondent on September 10,
1951, is a direct violation of Memorandum No. 38 and hence null and void. The
contract was contrary to sound policy and civic honesty. The policy enunciated in
Memorandum No.38, s. 1949 is sound policy. When students are given full or
partial scholarships, it is understood that such scholarships are merited and
earned. The amount in tuition and other fees corresponding to these scholarships
should not be subsequently charged to the recipient students when they decide to
quit school or to transfer to another institution. Scholarships should not be offered
merely to attract and keep students in a school.