THI

RDDI
VISI
ON

G.
R.No.
115838 
   
  J
uly18,
2002

CONSTANTEAMORDECASTROandCORAZONAMORDECASTRO,
 
pet
iti
oner
s, 

vs
.

COURTOFAPPEALSandFRANCI
SCOARTI
GO,
 
res
pondent
s.

CARPI
O, 
J.
:

TheCas
e

Beforeusi saPet i
ti
onforRevi
ewonCer t
ior
ari
1 seeki
ngtoannultheDecis
ionoftheCour tof
Appeal s
2 datedMay4,1994inCA-
G.R.
CVNo. 37996,whichaf
fir
med i
ntot
o thedec
isi
on3 ofthe
RegionalTr i
alCourtofQuezonCit
y,Branch80,inCivilCas
eNo.Q- 89-
2631.Thet r
ialcourt
di
spos edasfollows:

"
WHEREFORE,theCourtfi
ndsdef
endant
sCons
tant
eandCor
azonAmordeCas
troj
oint
lyand
s
oli
dar
il
yli
abl
et opl
aint
if
fthes
umof:

a)
 P303,
606.
24r
epr
esent
ingunpai
dcommi
ssi
on;

b)
 P25,
000.
00f
orandbywayofmor
aldamages
;

c
) P45,
000.
00f
orandbywayofat
tor
ney'
sfees
;

d)Topayt
hec
ostoft
hiss
uit
.
Quez
onCi
ty,
Met
roMani
la,
Dec
ember20,
1991.
"

TheAnt
ecedentFac
ts

OnMay29,1989,pr i
vat
er espondentFr anc
iscoArti
go( "Ar
tigo"forbrevi
ty)suedpetit
ioners
Const
anteA.DeCast
ro("
Cons t
ante"forbrevi
ty)andCorazonA. DeCast
ro("Coraz
on"forbrevit
y)
tocoll
ectt
heunpaidbalanceofhi sbroker'
sc ommissi
onf r
om t heDeCas tr
os.4 
TheCour tof
Appeal
ssummariz
edthefactsinthi
swi s
e:

"xxx. Appellants
5 wereco-owner soff our(4)l otslocatedatEDSAc or
nerNewYor kandDenver
Street
si nCubao,Quez onCity.Inal etterdatedJ anuary24,1984( Exhibit"A-1,p.144,Records),
appell
ee6  wasaut hor
izedbyappel l
antst oac tasr eales tat
ebr okeri nt hes al
eoft hese
propertiesfortheamountof  P23,
000, 000.00,f i
veper cent( 5%)ofwhi chwi llbegiventot he
agentasc ommi ssi
on.Itwasappel leewhof ir
s tfoundTi mesTr ansi
tCor porat
ion, r
epresent
edby
it
spr esidentMr .Rondar i
s,aspr ospec t
ivebuyerwhi ch desir
ed tobuyt wo( 2)lotsonl y,
specif
icall
yl ot
s14and15.Event ually,somet imei nMayof1985,t hesaleofl ots14and15was
consummat ed.Appell
eereceivedfromappel lants  
P48,893.
76asc ommi s si
on.

Itwast hent hatther i

ftbetweent hecont
endingpar t
iessoonemer ged.Appelleeappar entl
yf elt
shor tchangedbec auseaccordingtohim,histotalcommi ssi
ons houldbe P352,500.00whi chi s
fiveper cent( 5%)oft heagr eedpr i
ceof P7,
050,000.00pai dbyTi mesTr ansitCor porati
ont o
appel l
antsfort het wo(2)lots,andthatitwashewhoi ntroducedt hebuyert oappel l
antsand
unc easi
nglyf aci
li
tatedt henegotiati
onwhi chulti
mat el
yl edt othec ons
ummat ionoft hes ale.
Henc e,hes uedbel owt ocoll
ectthebalanceof P303,606.24afterhavingreceived P48,893.76in
advanc e.
1âwphi 1.nêt

Ont heotherhand,appel l
antscompletelytraverseappellee'
sc l
aimsandes senti
all
yar guet hat
appelleei
sselfi
shlyas kingformorethanwhathet rul
ydes ervedasc ommi s
s i
ontothepr ejudice
ofot heragentswhower emor einstrument alint hec ons ummat ionoft hes al
e.Al though
appellant
sreadil
yc onc edethati
twasappel leewhof i
rsti
ntroduc edTimesTransitCorp.tothem,
appelleewasnotdes ignatedbythem ast heirexclusi
vereales t
ateagentbutt hatinfactt here
weremor eorlessei ghteen(18)otherswhos ec ol
lecti
veeffortsint helongrundwar f
edt hos eof
appellee'
s,consi
der ing thatthef i
rstnegot iati
on forthes al
ewher eappelleet ookac t
ive
parti
ci
pat i
onf ai
ledandi twast heseot heragentswhos ucces
s f
ullybr oker
edi nt hes econd
negoti
ation.But des pitethis and out ofappel l
ants'" purel iber al
ity,beneficence and
magnanimi ty",appelleenever thel esswasgivent helargestcutint hec ommi s
sion(P48,893.76),
alt
houghont hepr i
nc i
pleof quant um meruit
 hewoul dhavec ertainlybeenent it
ledt oless.So
appell
ees houl dnothavebeenhear dtocompl ai
nofget ti
ngonl yapi t
t ancewhenheac t
uallygot
theli
on'sshar eoft hec ommi ssi
onandwor se,heshouldnothavebeenal l
owedt ogett heent ir
e
commi s
s i
on. Furthermor e,t
hepur c has
epr i
ceforthet wolotswasonl y P3.6milli
onasappear i
ng
inthedeedofs al
eandnot  
P7. 05mi l
li
onasal legedbyappel lee.Thus ,evenas sumingt hat
appell
eei sent it
ledtot heent i
r ec ommi ssi
on,hewoul donlybeget t
ing5% oft heP3. 6mi l
lion,
or 
P180,000.00. "

Rul
ingoft
heCour
tofAppeal
s

TheCour
tofAppeal
saf
fi
rmed 
i
ntot
o t
hedec
isi
onoft
het
rialc
our
t.

Fir
s t
. 
TheCour tofAppeal sfoundt hatConstanteauthori
zedAr ti
gotoac tasagenti nthes aleof
twol otsinCubao, Quez onCity.Thehandwr i
ttenauthori
zati
onl ett
ersignedbyCons t
ant ec learl
y
establis
hedac ontractofagenc ybetweenCons tanteandArtigo.Thus,Arti
gos oughtpr ospec ti
ve
buyer sandf oundTi mesTr ansitCorporati
on( "
TimesTransit
"f orbrevit
y).Arti
gof aci
litatedt he
negot i
ationswhi chevent uall
yl edtothes aleofthet wolots.Therefore,theCour tofAppeal s
decidedt hatAr t
igoisent it
ledt othe5% c ommi ss
ionont hepur chasepriceaspr ovidedi nt he
contractofagenc y.

Second. 
TheCourtofAppeal sruledthatAr t
igo'
scompl ainti
snotdismiss
ibl
eforfai
lur
eto
i
mpl eadasindis
pensableparti
est heotherco-ownersoft hetwolots
.TheCourtofAppeal
s
explai
nedthati
tisnotnec es
sarytoimpleadtheotherco-ownerss
incetheacti
oni
sexcl
usi
vel
y
basedonac ont
ractofagencybetweenAr t
igoandConstante.

Thi
rd. 
TheCourtofAppealslikewisedec laredthatthet rialcour
tdi dnoterri
nadmi tti
ngpar ol
evi
dencetoprovet hetr
ueamountpai dbyTi mesTransitt ot
heDeCas tr
osforthet wol ot
s.The
CourtofAppeal sruledthatevidenc e ali
unde couldbepr esentedt oprovet hatt heac tual
purc
hasepr i
cewas  
P7.
05 mi l
li
on and notP3. 6 mi l
li
on asappear i
ng inthedeed ofs ale.
Evi
dence 
ali
unde isadmiss
ibl
ec onsideri
ngt hatArti
goisnotapar ty,butamer ewi tnessinthe
deedofsalebet weentheDeCas t
rosandTi mesTransit.TheCour tofAppealsexpl ai
nedt hat,
"t
herulethatoralevi
denceisinadmi s
siblet ovarythetermsofwr it
teninst
rument sisgenerally
appli
edonlyinsui
tsbet
weenpartiestotheins
trumentandstr
angerstothec ontr
actarenot
boundbyit.
"Besi
des,
Arti
gowasnots ui
ngunderthedeedofs
ale,butsol
elyunderthecontr
act
ofagenc
y.Thus,
theCour
tofAppealsupheldt
hetrialc
our
t'
sfi
ndingthatt
hepurc has
epric
ewas
P7.05mil
li
onandnotP3.
6mill
ion.

Henc
e,t
hei
nst
antpet
iti
on.

TheI
ssues

Ac
cor
dingt
opet
iti
oner
s,t
heCour
tofAppeal
ser
redi
n-

I
.NOT ORDERING THE DISMISSAL OF THE COMPLAI
NT FOR FAI
LURE TO I
MPLEAD
I
NDI
SPENSABLEPARTI
ES-
IN-
INTEREST;

I
I.NOTORDERI
NGTHEDISMI
SSALOFTHECOMPLAINTONTHEGROUNDTHATARTI
GO'
SCLAI
M
HASBEENEXTI
NGUI
SHEDBYFULLPAYMENT,
WAIVER,ORABANDONMENT;

I
II
.CONSI
DERI
NGI
NCOMPETENTEVI
DENCE;

I
V.GI
VINGCREDENCETOPATENTLYPERJ
UREDTESTI
MONY;

V.
SANCTI
ONI
NGANAWARDOFMORALDAMAGESANDATTORNEY'
SFEES;

VI.NOTAWARDI
NGTHEDECASTRO'
SMORALANDEXEMPLARYDAMAGES,ANDATTORNEY'
S
FEES.

TheCour
t'
sRul
ing
Thepet
iti
oni
sber
eftofmer
it.

Firs
tIssue:whet
herthec
ompl
aintmer
itsdi
smi
ssalf
orf
ail
uret
oimpl
eadot
herc
o-owner
sas
indi
spensabl
eparti
es

TheDeCas t
rosarguethatAr t i
go'scompl
aintshouldhavebeendi smissedforfai
luretoimplead
allt
hec o-ownersofthetwol ots.
TheDeCas tr
osc l
aimthatAr t
igoalwaysknewt hatthet wol
ots
werec o-ownedbyCons tanteandCor az
onwi tht hei
rot hersi
bli
ngsJ oseandCar melawhom
Constante merelyr epresent ed.The De Cas tros contend that fail
uret oi mplead such
indi
spensableparti
esisfat altot hecomplai
ntsinceAr t
igo,asagentofal lt
hef ourco-owners
,
wouldbepai dwithfundsc o-ownedbyt hefourco-owners.

TheDeCas
tros
'cont
ent
ionsar
edevoi
dofl
egalbas
is.

Ani ndispensabl
epar tyisonewhos eint
er estwillbeaf fectedbyt hec ourt'
sac t
ioni nt he
li
ti
gation,andwi thoutwhom nof i
naldeterminati
onoft hec asecanbehad. 7 
Thejoinderof
i
ndispens able parties i s mandatory and c ourt
s c annot pr oc
eed wi thout t heir
presence.8 Wheneveritappearstot
hecourti nthecourseofapr oceedi
ngthatani ndispensable
part
yhasnotbeenj oined,i
tisthedut
yoft hec our
tt ostopt hetri
alandor dertheinclusi
onof
suchpart y.
9

However
,ther
uleonmandat
oryj
oinderofi
ndi
spens
abl
epar
tiesi
snotappl
icabl
etot
hei
nst
ant
cas
e.

Thereisnodisput
et hatCons
tanteappoi
ntedArti
goinahandwr i
ttennotedatedJ
anuary24,
1984tos el
ltheproperti
esoftheDeCas t
rosforP23milli
onata5per c
entcommiss
ion.The
author
itywasonafir
s tc
ome,fi
rstser
vebasi
s.Theaut
hor
ityreadsi
nfull
:

"
24J
an.
84

ToWhomI
tMayConc
ern:
Thi
sistost
atethatMr.Franci
scoArt
igoi
saut
hori
zedasourr
ealest
atebrokerinconnect
ion
wit
hthesal
eofourproper
tylocat
edatEds
aCor
nerNewYork&Denver
,Cubao,QuezonCit
y.

As
kingpr
ice 
P 23,
000,
000.
00wi
th5% c
ommi
ssi
onasagent
'sf
ee.

C.
C.deCas
tro

owner&r
epr
esent
ing

c
o-owner
s

Thi
saut
hor
ityi
sonaf
irs
t-c
ome

Fi
rsts
ervebas
is–CAC"

Constantesignedt henot easownerandasr epresentat i

veoft heotherco-owners.Underthis
note,ac ontractofagenc ywasc l
ear
lyc onstit
utedbet weenCons tant
eandAr ti
go.Whet her
Constanteappoi ntedAr t
igoasagent,inCons tante'sindivi
dualorr epres
entati
vec apaci
ty,or
both,theDeCas trosc annotseekthedismiss
aloft hec aseforfail
uretoimpleadt heotherco-
ownersasi ndispens ableparti
es.
 TheDeCas t
r osadmi tt hattheotherco-ownersar esoli
dari
ly
li
ableundert hec ontractofagency,
10 
ci
tingAr ti
cle1915oft heCivi
lCode,whichreads:

Art.1915.Iftwoormoreper s
onshaveappoi
ntedanagentforacommont r
ans
acti
onor
undertaki
ng,t
heys
hal
lbesol
idari
lyl
iabl
etot
heagentf
oral
lthec
ons
equenc
esoft
heagency.

Thes ol
idar
yliabil
it
yofthef ourco-
owners
,however,mil
it
atesagai
nsttheDeCast
ros
'theory
thattheotherco-ownersshouldbeimpl
eadedasindis
pensabl
eparti
es.Anot
edcommentator
explai
nedArti
c l
e1915thus–

"
Ther
ulei
nthi
sar
tic
leappl
iesevenwhent
heappoi
ntment
swer
emadebyt
hepr
inc
ipal
sin
separateact s
,pr ovidedt hatt heyar eforthesamet ransac
tion.
 
Thes ol
idari
tyari
sesfrom t
he
commoni nterestoft hepr i
ncipal s,andnotf r
om theactofconsti
tuti
ngtheagency.Byvirt
ueof
thi
ss ol
idari
ty ,t
heagentc anr ec overf r
om anyprinc
ipalthewholecompens ati
onandindemnit
y
owingt ohi m byt heot hers. Thepar t
ies,however,may,byexpr essagreement,negatethis
soli
daryr es
pons ibi
lity.Thes olidaritydoesnotdisappearbyt hemerepar t
iti
oneff
ectedbythe
pri
ncipalsaftertheac compl i
s hmentoft heagency.

I
ftheundert
akingisoneinwhichs everalareinter
ested,butonl ysomec reatetheagenc y,onl
y
t
helatt
eraresoli
dari
lyl
iabl
e,withoutpr ej
udicetotheeffectsof 
negotiorumges ti
o withrespec
t
t
ot heothers.Andifthepowergr antedi ncl
udesvar i
oust ransact
ionss omeofwhi chare
c
ommonandot her
sarenot,onl
yt hoseinterest
edineac htransacti
onshallbeliabl
ef orit
."11

Whent helaw expr es

slypr
ovi
desforsol
idari
tyoftheobli
gati
on,asi nthel i
abi
li
tyofc o-
pri
ncipalsinac ontr
actofagency,each obli
gormay be compelled t
o pay the enti
re
obl
igation.
12 Theagentmayrec
overthewholecompens
ati
onfrom anyoneoftheco-
princi
pals
,
asinthiscase.

I
ndeed,Art
icl
e1216oft heCi
vilCodepr
ovi
dest
hatac
redi
tormays
ue 
any 
oft
hes
oli
dar
y
debt
ors.
Thi
sarti
cler
eads
:

Art.1216.Thecredi
tormayproceedagai
nstanyoneoft hesoli
darydebtorsorsomeorallof
them simult
aneousl
y.Thedemandmadeagainstoneofthem shallnotbeanobstacl
etothose
whichmays ubsequentl
ybedir
ectedagai
nsttheother
s,solongast hedebthasnotbeenful
ly
coll
ected.

Thus
,theCour
thasr
uledi
n Oper
ator
sInc
orpor
atedvs
.Amer
icanBi
scui
tCo.
,I
nc.
13 
that–

"
xxx soli
dari
tydoesnotmakeas ol
idar
yobligorani ndis
pensabl
epartyinasuitfi
ledbythe
c
redi
tor.Art
icl
e1216oftheCivi
lCodesaysthatt hecredit
or`mayproceedagains
tanyoneof
t
hesoli
darydebtor
sorsomeoral
lofthemsimultaneously'
.
"(Emphasi
ssuppli
ed)

Second I
ssue:whet
herAr
tigo'
scl
aim hasbeen ext
ingui
shed byf
ullpayment
,wai
veror
abandonment
TheDeCas trosclaimthatAr t
igowasfullypaidonJ une14,1985,thatis,Art
igowasgi ven"his
propor
tionateshareandnol ongerentit
ledtoanybal ance.
"Accordi
ngt othem,Ar t
igowasj ust
oneoftheagent sinvolvedint hesal
eandent i
tledtoa"propor
tionateshare"i
nt hecommi ss
ion.
TheyassertthatAr ti
godi dabs ol
utel
ynot hi
ngdur i
ngt hesecondnegot i
ati
onbutt osignasa
witnes
si nthedeedofs ale.Hedi dnotevenpr eparethedocument sforthet r
ansact
ionasan
acti
verealestat
ebr okerus ual
lydoes.

TheDeCas
tros
'ar
gument
sar
efl
ims
y.

Ac ontr
actofagencywhichisnotc ontrar
ytol aw,publ
icor
der,publ
icpol
icy,moralsorgood
custom isavalidcont
rac
t,andc ons t
itut
est helaw bet
weent hepart
ies
.14 Thecontr
actof
agencyenteredint
obyConstantewi t
hAr ti
goi st
helawbetweenthem andbot har
eboundt o
complywi t
hitst
ermsandcondit
ionsingoodf ai
th.

Themer efactthat"ot
heragent s
"inter
venedi nthec onsummat i
onoft hesaleandwerepaid
thei
rrespecti
vecommi s
s i
onscannotvarythetermsoft hecontractofagencygrant
ingArt
igoa
5per centcommi s
sion basedon thes el
lingprice.These" ot
heragent s"turnedouttobe
employeesofTimesTrans i
t,t
hebuyerAr t
igointroducedtotheDeCas tr
os.Thi
spromptedthe
tri
alcourtt
oobserve:

"Thealleged` secondgroup'ofagent scamei ntothepictureonl yduringtheso-call

ed`second
negotiati
on'andi ti
samus i
ngt onotet hatt
hes e(s
ic)secondgr oup,prominentamongwhomar e
Atty.DelCas t
illoandMs .Prudencio,happenedt obeempl oyeesofTi mesTransi
t,thebuyerof
theproper t
ies.Andt hei
reffortswer elimi
tedt oconvincingCons tanteto'partaway'withthe
properti
esbec ausetheredempt ionper i
odoft heforecl
osedpr operti
esisaroundt hecor
ner,so
tospeak.(tsn.June6,1991).

xxx

ToacceptCons
tante'
sversi
onofthestoryi
stoopenthefl
oodgatesoffraudanddecei
t.As
ell
er
coul
dalwayspret
endr ej
ect
ionoftheoff
erandwaitf
orsometimeforotherstorenewi
twhoare
muchwi l
li
ngtoac ceptacommi s
sionfarl
essthantheorigi
nalbroker. 
Theimmoral
it
yinthe
i
nstantcaseeas
ilypr
esentsit
sel
fifonehast
oc ons
idert
hatt
heall
eged`s
econdgroup'ar
ethe
employeesofthebuyer,TimesTransi
tandtheyhavenotbett
eredtheoff
ersec
ur edbyMr.
Art
igofor 
P7mill
ion.

Iti
st obenotedals
ot hatwhil
eCons t
antewast oopart
icularabouttheunrenewedrealestat
e
broker'
sli
censeofMr.Arti
go,hedidnotbot heratal
ltoinquir
east otheli
censesofPrudenci
o
andCastil
lo.
(ts
n,Apri
l11,1991,pp.
39-40).
"15 (
Emphasi
ss uppli
ed)

I
nanyevent,wef
indthatthe5percentrealestat
ebroker'
scommissi
onisreas
onabl
eandwi
thi
n
t
hestandar
dprac
tic
eint hereales
tatei
ndus t
ryfort
ransacti
onsoft
hisnat
ure.

TheDeCastr
osals
ocont
endthatArt
igo'si
nact
ionaswel
lasf
ail
uretopr
otestes
topshi
mfrom
rec
over
ingmorethanwhatwasact
uallypai
dhim.TheDeCast
rosci
teArt
icl
e1235oftheCivi
l
Codewhic
hreads
:

Art.1235.When t
he obli
gee ac
cept
sthe per
for
mance,knowing i
tsincomplet
enes
sand
i
rregul
ari
ty,andwi
thoutexpr
essi
nganypr
otestorobj
ect
ion,t
heobligat
ionisdeemedful
ly
compli
edwith.

TheDeCas tr
os'r
eli
anceonAr t
icl
e1235oft heCivilCodeismi s
placed.Art
igo'
saccept
anceof
par
tialpaymentofhi
scommi ss
ionneitheramountstoawai verofthebalancenorputshi
mi n
est
oppel.Thi
sist
heimportofArti
cle1235whic
hwasexpl ai
nedint hi
swise:

"Theword accept
,asusedi nArticl
e1235oft heCivilCode,meanstotakeass at
isf
actor
yor
suff
ici
ent,oragreetoani ncompleteorirr
egularperformance.
 
Hence,themerer ecei
ptofa
part
ialpaymenti snotequi valenttot he r
equir
ed ac cept
ance ofperf
ormance aswould
exti
nguis
ht hewholeobl
igati
on."
16 (Emphas
issuppl
ied)

Thereist husacl
eardist
inct
ionbet
weenac cept
anc
eandmer e 
rec
eipt
. 
Inthi
scase,itisevi
dent
thatArtigomerelyrec
eivedthepart
ialpaymentwi
thoutwai
vingthebalanc
e.Thus,therei
sno
estoppeltospeakof
.
TheDeCas t
rosfurt
herarguethatl
achesshouldapplybecauseArti
godidnotfi
lehi
scompl
aint
incourtunt
ilMay29,1989,oralmostfouryearsl
ater.Hence,Ar
tigo'
scl
aimforthebal
anc
eof
hiscommiss
ionisbarr
edbylaches.

Lachesmeanst hefail
ureorneglect
,foranunreasonabl
eandunexplainedlengthofti
me,todo
thatwhichbyexercis
ingduedil
igencecouldorshouldhavebeendoneearli
er.Iti
snegl
igenc
eor
omissiontoassertar i
ghtwit
hinar easonabl
et i
me,war r
anti
ngapr esumptionthatthepart
y
enti
tledtoass
er ti
teit
herhasabandoneditordecli
nedtoasserti
t.
17

Ar t
igodisputesthec l
aimt hatheneglec
tedtoasserthisri
ght s
.Hewasappoi ntedasagenton
January24, 1984.Thet wolotswerefi
nall
ysoldi
nJ une1985. Asfoundbythet r
ialcourt
,Arti
go
demandedi nApr ilandJ ul
yof1985thepaymentofhi scommis s
ionbyConstanteont hebasi
sof
thes el
li
ngpr ic
eof  
P7.05mi l
li
onbuttherewasnor esponsefrom Const
ante.18 
Afteritbec
ame
clearthathisdemandsf orpaymenthavefal
lenondeafear s,Arti
godecidedtos ueonMay29,
1989.

Ac t
ionsuponawr it
tenc ontrac t,
suchasac ontrac
tofagency,mustbebr oughtwit
hintenyear
s
from thetimet herightofac tionaccrues
.19 Therightofac
tionacc
r uesfrom t
hemomentt he
breac hofri
ghtordut yoc c
urs .From t
hismoment ,t hecr
edi
torcaninsti
tutetheacti
onevenas
thet en-
yearprescr
iptiveperiodbeginstorun.20

TheDeCas trosadmi tt hatArti

go'scl
aim wasfiledwi t
hinthet en-yearpresc
riptiveper i
od.The
DeCastros,however ,stil
lmaintai
nthatArti
go'sc auseofactionisbarredbylaches .Lachesdoes
notapplybec auseonl yf ouryearshadlapsedf rom thetimeoft hes al
einJ une1985.Ar ti
go
madeademandi nJ uly1985andf il
edtheac t
ioni ncourtonMay29,1989,wel lwithintheten-
yearprescr
ipti
veper iod.Thisdoesnotconsti
tuteanunr easonabledelayinasser t
ingone'sright.
TheCour thasr uled, "
adel aywithi
nt heprescripti
veper i
odi ss ancti
onedbyl aw andi snot
consi
deredt obeadel ayt hatwouldbarreli
ef."
21 Inexplainingthatlachesappl i
esonl yinthe
absenceofas tat
utor yprescri
pti
veperi
od,theCour thasstated-

"
Lachesi srecours
ei n equi
ty.
 Equi
ty,however ,i
sapplied onl
yi nthe abs
ence,neverin
c
ontraventi
on,ofst
atutoryl
aw.Thus,lac
hes,cannot
,asarule,
beus edt
oabateacoll
ect
ionsui
t
f
il
edwi t
hintheprescr
ipti
veperi
odmandat edbytheCivi
lCode.
"22
Cl
ear
ly,
theDeCas
tros
'def
ens
eofl
achesf
indsnos
uppor
tinl
aw,
equi
tyorj
uri
spr
udenc
e.

Thi
rdi
ssue:whet
hert
hedet
ermi
nat
ionoft
hepur
chas
epr
icewasmadei
nvi
olat
ionoft
heRul
es
onEvi
dence

TheDeCas t
roswanttheCour ttore-examinetheprobati
vevalueoftheevidenceadducedinthe
tr
ialcourtt
odet ermi
newhet hert heactualsel
li
ngpr i
ceofthet wolotswas P7.05mill
ionand
not 
P3.6mill
ion.TheDeCas tr
osc ontendthatiti
ser r
oneoustobaset he5per centcommissi
on
onapur c
hasepr i
ceof 
P7.05mill
ionasor deredbythetri
alcourtandtheappellatecour
t.TheDe
Castr
osinsi
stthatthepur c
hasepr i
ceisP3.6mill
ionasexpresslyst
atedinthedeedofs ale,t
he
dueexecuti
onandaut henti
cit
yofwhi chwasadmi tt
edduringthetri
al.

TheDeCas trosbelievethatthet ri
alandappel lat
ec ourtscommi tt
edami st
akei nc onsidering
incompetentevi denceanddi s
regardingthebes tevi
denc eandpar ol
eevi dencerules .Theyc lai
m
thatt heCour tofAppeal ser roneousl
yaf fi
rmed subs i
lenti
o thetrialc ourt
'srelianceont he
variouscorrespondencesbet weenCons tanteandTi mesTr ansitwhichwer emer ephot ocopies
thatdo nots ati
sfythe bestevi dencer ule.Further,thesel ett
er sc overed onlyt he f irs
t
negot i
ati
onsbet weenCons tanteandTi mesTr ansi
twhichf ai
led;henc e,theseareimmat erialin
determiningt hefi
nalpurchasepr i
ce.

TheDeCas trosfurtherar guethatiftherewasanunder valuation,Ar ti

gowhos i
gnedaswi t
ness
benefi
tedt herefrom,andbei ngequal l
ygui lt
y,shouldbel eftwher ehepr esentl
ystands .They
li
kewiseclaimt hatt heCour tofAppeal serredinrelyi
ngonevi denc ewhichwer enotofferedfor
thepurpos ec onsideredbyt het r
ialcourt.Specif
ical
ly,Exhibits" B","C"
,"D"and" E"wer enot
off
eredtopr ovethatt hepur chasepricewasP7. 05Mi ll
ion.Finally,theyarguethat 
thec ourts 
a
quo 
erredingi vingc redencetot heperjuredtesti
monyofAr ti
go. Theywantt heentir
et esti
mony
ofArti
gor ejec t
edasaf als
ehoodbec ausehewasl yingwhenhec laimedatt heoutsetthathe
wasalicens edreales tatebrokerwhenhewasnot .

Whet
hertheactualpurchasepr
icewas 
P7.05Mil
li
onasfoundbyt het
rialcour tandaff
irmedby
t
heCourtofAppeals
, or
 P3.
6Mil
lionascl
aimedbytheDeCastros
,isaquestionoff ac
tandnotof
l
aw.I
nevit
ably,
thiscall
sforani
nquiryi
ntothef
actsandevi
denceonrecord. Thiswecannotdo.

I
tisnott
hef
unc
tionoft
hisCour
ttor
e-exami
net
heevi
denc
esubmi
ttedbyt
hepar
ties
,or
analyzeorweightheevidenceagai n.
23 
ThisCourtisnotthepropervenuetocons
iderafact
ual
is
sueasi tisnotatri
eroffacts.Inpetit
ionsforrevi
ewonc er
tior
ariasamodeofappealunder
Rule45, apeti
ti
onercanonlyraisequestionsofl
aw. Ourpronouncementi
nthecaseof 
Cormero
vs.CourtofAppeal
s24 bear
sreiterati
on:

"Att heout s
et,itisevi dentf r om theer ror sas s i
gnedt hatt hepet i
tioni sanc horedonapl eat o
reviewt hef actualc onc l
usionr eachedbyt her es pondentc ourt. Suc ht as khoweveri sf oreclosed
byt her ulethatinpet i
tionsf orc ertiorariasamodeofappeal ,li
ket hisone, onlyques t i
onsofl aw
distinctl
ys etfor t
hmayber aised.Thes eques t i
onshavebeendef i
nedast hoset hatdonotc all
foranyexami nationoft hepr obat i
veval ueoft heevi dencepr es entedbyt hepar ties.(Uniland
Res ourcesvs .Devel opmentBankoft hePhi lippines,200SCRA751[ 1991]c it
ingGoduc ovs .
Cour tofappeal s
,etal .,119Phi l
.531;Her nandezvs .CourtofAppeal s
,149SCRA67) .Andwhen
thisc ourtisaskedt ogoovert hepr oofpr es ent edbyt hepar t
ies , andanal yze,asses sandwei gh
them t oas certainift het ri
alc ourtandt heappel latecour twer ec orrec tinac cordings uper ior
credi ttot hi
sort hatpi eceofevi denc eandevent uall
y,tot het ot ali
tyoft heevi denc eofone
partyort heot her,thec our tc annotandwi llnotdot hesame.( El aydavs .Cour tofAppeal s
,199
SCRA349[ 1991]).Thus ,int heabs enceofanys howingt hatt hef i
ndi ngsc ompl ainedofar e
totallydevoi dofs uppor tint her ecor d,ort hatt heyares ogl aringl yer r oneousast oc onsti
tut e
seriousabus eofdi scretion,s uc hfindingsmus ts tand,forthisc our tisnotexpec tedorr equired
toexami neorc ont r
as ttheor alanddoc ument ar yevidences ubmi ttedbyt hepar ti
es .(Mor al
esvs .
Cour tofAppeal s,
197SCRA391[ 1991]c itingSant aAnavs .Her nandez , 18SCRA973[ 1966]).
"

Wef i
ndnor eas
ont odepartfrom t
hispri
nci
ple.Thetri
alandappel
lat
ec our
tsarei
namuc h
bett
erpos
iti
ontoevaluateproper
lytheevi
dence.Henc
e,wefindnoot
herrecours
ebuttoaf
fi
rm
thei
rfi
ndi
ngont heactualpur
chasepri
ce.
1âwphi1.
nêt

Four
thI
ssue:whet
herawar
dofmor
aldamagesandat
tor
ney'
sfeesi
spr
oper

TheDeCas trosc l
aimthatArt
igofai
ledtopr ovethathei sentit
ledtomoraldamagesand
att
orney'
sfees.TheDeCastr
os,
however,c
itenoc onc
retereasonexceptt
osaythattheyar
ethe
onesenti
tl
edt odamagessi
ncethec
asewasf i
ledtoharassandextortmoneyf
romt hem.

Law andjuris
prudenc
es upporttheawardofmor aldamagesandat t
orney'
sfeesinfavorof
Art
igo.Theawardofdamagesandat tor
ney'sfeesislef
ttothesounddis
c r
eti
onofthecour
t,and
ifs
uchdi s
creti
oniswellexerc
ised,asinthiscase,itwil
lnotbedisturbedonappeal
.25 
Mor al
damagesmaybeawar dedwheni nabr eachofc ontr
ac tthedef endantactedinbadf aith,or 
in
want on di s
regard ofhi sc ontract
ualobl i
gation.
26 On t he ot herhand,at torney'sf eesar e
awar dedi ninstanceswher e"thedef endantac tedingr ossandevi dentbadf aithinr ef usi
ngt o
satisf
yt hepl ai
ntiff
'splai
nl yval i
d,j
us tanddemandabl ec lai
m. "27 Ther
ei snor easont odisturb
thet ri
alc ourt'
sf i
ndingt hat" thedef endants'lackofgoodf aithandunki ndt reatmentoft he
plainti
ffinr efusingt ogi vehi sduec ommi ssiondes ervec ens ure.
"Thiswar rant st heawar d
of 
P25, 000.00inmor aldamagesand  P 45,000.00inattorney'sfees .Theamount sar e,inourvi ew,
fairandr easonable.Havingf oundabuyerf orthet wolots ,
Ar t
igohadal readyper formedhi spart
oft hebar gai
nundert hec ontractofagenc y.TheDeCas tross houldhaveexer cisedf airnessand
goodj udgmenti ndealingwi t
hAr ti
gobyf ulf
ill
ingtheirownpar tofthebargain-payi ngAr tigo
his5per centbr oker'
sc ommi ssionbasedont heac t
ualpur chasepr iceofthetwol ots.

WHEREFORE,thepeti
ti
oni
sdeni
edforlackofmeri
t.TheDec
isi
onoft
heCour
tofAppeal
sdat
ed
May4,1994i
nCA-G.R.CVNo.
37996is
 AFFIRMED 
i
nt oto.

SOORDERED.

Puno,
andPangani
ban,
JJ.
,
 conc
ur.

Sandoval
-Gut
ier
rez
,J.
,
 nopar
tduet
ocl
osef
ami
lyr
elat
ionwi
thapar
ty.

Foot
not
e

1 
UnderRul
e45oft
heRul
esofCour
t.

2 
SeventhDi
vis
ionc
ompos
edofJust
icesRi
cardoJ
.Fr
anc
isc
o(Chai
rmanandPonent
e);Sal
omeA.
MontoyaandRamonA.
Barcel
ona(
Member s
).

3 
PennedbyJ
udgeBeni
gnoT.
Dayaw.
4 
Whenr
efer
redt
ocol
lec
tivel
y.

5 
Ref
err
ingt
otheDeCas
tros
.

6 
Ref
err
ingt
oAr
tigo.

7 Rule 3,Sect
ion 7 ofthe Rules ofCour
t;Seno 
vs.Mangubat,156 SCRA 113 (
1987)
;
Quisumbing 
vs.
 Cour
tofAppeals
,189SCRA325( 1990)
;Loz
ano 
vs. 
Bal
les
teros
,195SCRA681
(1991).

8 
I
bid.

9 
Vic
ent
eJ.
Franc
isc
o,TheRevi
sedRul
esofCour
t,Vol
.1,
p.271,
1973ed.

10 
Memor
andumofPet
iti
onerdat
edApr
il23,
1997,
p.8;Rol
lo,
p.175.

11 
Art
uroM.Tolent
ino,Comment
ari
esandJ
uri
spr
udenc
eont
heCi
vilCodeoft
hePhi
li
ppi
nes
,
Vol
.5,pp.
.428-
429,
1992ed.

12 Art.1207oft heCivi
lCodepr ovi
desasfoll
ows:"Art.1207.Thec oncurrenceoftwoormor e
credit
or soroftwoormor edebtorsi
noneandt hesameobl igat
iondoesnoti mplythateachone
ofthef ormerhasar i
ghttodemand,ort hateachoneoft helat
terisboundt orender
,enti
re
compl i
anc ewit
ht heprest
ati
on.Thereissol
idaryl
iabi
li
tyonl ywhent heobl i
gati
onexpress
lyso
states
, orwhent helaworthenatureoftheobli
gat
ionrequiressol
idari
ty."

13 
154SCRA738(
1987)
,rei
ter
atedi
nRepubl
ic 
vs.
 
Sandi
ganbay
an,
173SCRA72(
1989)
.

14 
SanAndr
es 
vs.
 
Rodr
iguez
,332SCRA769(
2000)
.
15 
Dec
isi
ondat
edDec
ember20,
1991ofRTCJ
udgeBeni
gnoT.
Dayan,
Rol
lo,
pp.
33-
34.

16 
Tol
ent
ino,
 
supr
a,s
eenot
e11,
Vol
.4,
p.279.

17 
Republ
ic 
vs.
 Cour
tofAppeal
s,301SCRA366(
1999)
;Oc
hagabi
a vs
.Cour
tofAppeal
s,304
SCRA587(1999).

18 
RTCDec
isi
on,
p.7;
 Rol
lo,
pp.
20-
36,
seep.
35.

19 Art
icl
e1144oftheCivilCodeprovi
desasfol
lows:"
Art.1144.Thefol
lowi
ngac
tionsmustbe
broughtwit
hintenyear
sf rom t
hetimetheri
ghtofacti
onac c
rues:(
1)Uponawri
ttencont
ract
;
(2)Uponanobli
gati
oncreatedbylaw;(
3)Uponajudgment."

20 
Tol
ent
ion,
 
supr
a,s
eenot
e16,
p.44.

21 
Agr
a vs
. 
Phi
li
ppi
neNat
ionalBank,
309SCRA509(
1999)
.

22 
I
bid.

23 
MoombaMi
ningExpl
orat
ionCompany
 vs
. 
Cour
tofAppeal
s,,
317SCRA388(
1999)
.

24 
247SCRA291(
1995)
.

25 
Bar
zaga 
vs.
 
Cour
tofAppeal
s,268SCRA105(
1997)
.

26 
Jos
eC.
Vit
ug,
Compendi
umofCi
vilLawandJ
uri
spr
udenc
e,p.
841,
1993Ed.
27 
Art
.2208,
Civi
lCodeoft
hePhi
li
ppi
nes
.

TheLawphi
lPr
ojec
t-Ar
ell
anoLawFoundat
ion