NON-IMPAIRMENT

CLEMONS VS NOLTING
FACTS

 On June 18, 1920, the acting governor general of the Philippines cabled the Secretary of
War of the US appointing Clemons as an electrical engineer with corresponding salary
and privileges.
 On February 1, 1921, the chief accountant of the Bureau of Public Works gave Clemons
666 pesos as hi salary. Clemons refused, insisting that his salary is 333 US Dollars,
equivalent to 739 pesos. Clemons demanded that he be paid an additional 73 pesos so
that his salary would be equivalent to the peso amount of 333 US Dollars.
 on August 8, 1921, the chief accountant issued in P’s favor a warrant for 73 pesos
 P presented this warrant to Nolting for audit but the latter refused. P claims that unless
the defendant countersigns the said warrant, the same will not be paid by the Treasurer
of the Philippine Islands, and plaintiff will be unable to collect and receive the said sum
of P73.33
ISSUE
WON a contract that promised to pay in “dollars” can be reimbursed in “peso” at a rate of 2 to 1,
is this violative of the rule against non-impairment of contracts
HELD
Yes, violative. Act 2657 initially stated that the silver Philippine peso, authorized by this Act,
shall be legal tender in the Philippine Islands for all debts, public and private, unless otherwise
specifically provided by contract." However, when it was amended by Act No. 2776, it omitted
the phrase which was found in the former legislation "unless otherwise specially provided by
contract."
Did the omission of that provision in Act No. 2776 make the tender of the Philippine silver peso,
at the rate provided for in defining the unit of value, a legal tender for the payment of debts,
public and private, when the contract expressly provided for payment of other specie? No. The
right of the legislative department of the state to adopt legislation changing or altering the
obligation of contract has been answered in the negative so many times
The contention on the part of the respondent that the Philippine paper peso is a legal tender for
the payment of a contract debt, when some other specie has not been provided, is not tenable
for the reason that it violates the terms of the express contracts. A contract to pay a certain sum
in money, without any stipulation as to the kind of money in which it shall be paid, may always
be satisfied by payment of that sum in any currency which is lawful money at the place and time
at which payment is to be made. That is the general rule. But when the contract stipulates the
specie or kind or character of money for the performance of the contract, it must be satisfied in
the medium of payment mentioned in the contract.
It would be ruinous to the commercial interests of the Philippine Islands to declare that the
payment of debts of money could be made in other specie than that stipulated in the contract.
NON-IMPAIRMENT

PRESLEY VS BELAIR
FACTS
A complaint for specific performance and damages with preliminary injunction was filed by
plaintiff-appellee, Bel-Air Village Association, Inc. (BAVA for short) against Teofilo Almendras
and Rollo Almendras (now both deceased and substituted by defendant-appellant Enedina
Presley) for violation of the Deed Restrictions of Bel-Air Subdivision that the subject house and
lot shall be used only for residential and not for commercial purposes and for non-payment of
association dues. Presley, as lessee of the property, used the residence to operate 'Hot Pan de
Sal Store'. The trial court aand CA ruled in favor of Bel Air
In the instant petition, BAVA assails the Court's decision in the Sangalang case, more
specifically the Court's interpretation of Ordinance No. 81-01 passed by the Metro Manila
Commission (MMC) on March 14, 1981. It avers that due to the multitude of issues raised and
the numerous pleadings filed by the different contending parties, the Court was misled and
unfortunately erred in concluding that Jupiter Street was reclassified as a "high density
commercial (C-3) zone" when in fact, it is still considered as a "(R-1) residential zone."
ISSUE

HELD
The respondent court in the case at bar was not at all entirely wrong in upholding the Deed of
Restrictions annotated in the title of the petitioners. It held that the provisions of the Deed of
Restrictions are in the nature of contractual obligations freely entered into by the parties.
Undoubtedly, they are valid and can be enforced against the petitioner. However, these
contractual stipulations on the use of the land even if said conditions are annotated on the
torrens title can be impaired if necessary to reconcile with the legitimate exercise of police
power.
Our jurisdiction guarantees sanctity of contract and is said to be the 'law between the
contracting parties,' (Civil Code, supra, art. 1159) but while it is so, it cannot contravene 'law,
morals, good customs, public order, or public policy.' (supra, art. 1306). Above all, it cannot be
raised as a deterrent to police power, designed precisely to promote health, safety, peace, and
enhance the common good, at the expense of contractual rights, whenever necessary.
Jupiter Street has been highly commercialized since the passage of Ordinance No. 81-01. The
records indicate that commercial buildings, offices, restaurants, and stores have already
sprouted in this area. We, therefore, see no reason why the petitioner should be singled out and
prohibited from putting up her hot pan de sal store. Thus, in accordance with the ruling in the
Sangalang case, the respondent court's decision has to be reversed.