64. Spouses Chin Kong Wong Choi and Ana O. Chua vs.

UCPB
Gr. No. 207747, March 11, 2015

Facts: A Contract to Sell involving a condominium unit in Kiener Hills Cebu was entered into by petitioner spouses and
Primetown. A down payment of P100,000.00 was given by petitioners while the remaining balance became payable in
40 equal monthly instalments from January 16, 1997 to April 16, 2000. In the meantime, on April 23, 1998, a
Memorandum of Agreement and Sale of Receivables and Assignment of Rights and Interests were executed by and
between respondent UCPB and Primetown. In 2006, a complaint for refund with interest and damages against
Primetown and UCPB was instituted by petitioners for failure of Primetown to finish the construction and to deliver the
subject condominium unit despite full payment of contract price. The Office of the President likewise ruled that UCPB
was jointly and severally liable with Primetown. The CA reversed the OP’s decision and reinstated HLURB RFO reinstated
in another aspect.

Issue :Whether respondent UCPB is solidarily liable with Primetown.

Ruling: No. Sc held that as for UCPB’s alleged solidary liability, there is no merit in the instant case, there is failure to
comply with Sections 17, 18 and 25 of Presidential Decree No. 957, which made the banks in those cases solidarily liable.
A solidary obligation cannot be inferred lightly, but exists only when expressly stated, or the law or nature of the
obligation requires it. Since there is no other ground to hold UCPB solidarily liable with Primetown and there is no
reason to depart from the ratio decidendi in  UCPB v. Ho, UCPB is only liable to refund Spouses Choi the amount it
indisputably received, which is P26,292.97 based on the evidence presented by Spouses Choi.

65. The Bachrach Motor Co v. Espiritu

G.R. No. L-28497    November 6, 1928

Facts:    This is a consolidated case involving two separate sale transactions. One made in Feb. 18, 1925, when the
defendant earlier bought a truck on installment from the petitioner and said truck was mortgaged together with the two
others in the subsequent sale transaction. The said two of the other trucks were also purchased (but already paid
previously) from the plaintiff.  The defendant failed to pay the balance. In July 1925, defendant again purchased another
truck from Bachrach. The said truck, together with the 3 other vehicles were mortgaged to the plaintiff to secure the
remaining balance. The defendant failed to pay the balance for the latest truck obtained. The defendant also signed a
promissory note solidarily with his brother Rosario (acting as intervenor), the sums secured by the mortgages.

Issue: W/N the 25% penalty upon the debt in addition to the 25% p.a. is usurious

Ruling: No, Article 1152 of the Civil Code permits the agreement upon a penalty apart from the interest. Should there be
such an agreement, the penalty, as was held in the case of Lopez vs. Hernaez (32 Phil., 631), does not include the
interest, and which may be demanded separately. The penalty is not to be added to the interest for the determination
of whether the interest exceeds the rate fixed by the law, since said rate was fixed only for the interest. But considering
that the obligation was partly performed, and making use of the power given to the court by article 1154 of the Civil
Code, this penalty is reduced to 10 per cent of the unpaid debt. The penalty is however reduced from 25 % upon the
sum owed, the defendants need pay only 10 % thereon as penalty. (Judgment appealed from is affirmed in all other
respects)

66. ROBES-FRANCISCO REALTY & DEVELOPMENT CORP. VS. CFI

G.R. No. L-41093, October 30, 1978

Facts:  In May 1962, Robes Corporation entered into a contract of sale with Millan for a parcel of land in the amount of
3,864.00 payable in installments.  Millan complied with her obligation and made her final payment on December 22,
1971 for a total payment of P5,193.63 including interests and expenses for registration of title.  On March 2, 1973 the
deed of absolute sale was executed but the transfer certificate of title could not be executed because the parcel of land
conveyed to Millan was included among other properties of the corporation mortgaged to GSIS to secure an obligation
of P10 million, hence, the owner’s duplicate certificate of title of the subdivision was in the possession of the GSIS.

ISSUE:   Is the 4% interest provision of the contract a penal clause?

RULING:  No.  Said clause does not convey any penalty, for even without it, pursuant to Article 2209 of the Civil Code,
the vendee would be entitled to recover the amount paid by her with legal rate of interest which is even more than the
4% provided for in the clause.   Unfortunately, Millan failed to show the actual damages she suffered as a result of the
nonperformance.  Nonetheless, the facts show that the right of the vendee was violated and this entitles her at the very
least to nominal damages.
regard.  Hence, the sum of ten thousand pesos by way of nominal damages is fair and just.

67. SAURA VS. DBP 

G.R. No. L-24968 April 27, 1972

FACTS: Plaintiff Saura, Inc. applied to the Rehabilitation Finance Corporation (RFC), before its conversion into DBP, for an
industrial loan. It was also stated in the loan, among others, that China Engineers, Ltd. will be one of the joint signatories
of the loan, and Saura, Inc. will use local raw materials in the manufacture of jute sacks.   Saura, Inc. had already
purchased the jute mill machinery on the strength of the letter of credit extended by Prudential Bank and Trust
Co.  However, RFC reduced the said loan from Php500,000.00 to Php300,000.00 despite the formal execution of the loan
agreement.  Then, China Engineers, Ltd. withdrew its signature to the said loan.  Thereafter, Saura, Inc. demanded the
release of the originally approved loan. Due to Saura, Inc.’s failure to proceed with the said loan with RFC, Prudential
Bank and Trust Co. sued them for their failure to pay its obligation with said bank.  The trial court rendered judgment for
the plaintiff.  Hence this petition.  

 ISSUE: Was there a perfected contract between Saura, Inc. and RFC?

RULING: Yes.  However, when RFC turned down the request in its letter, the negotiations which had been going on for
the implementation of the agreement reached an impasse. Saura, Inc. obviously was in no position to comply with RFC's
conditions. So instead of doing so and insisting that the loan be released as agreed upon, Saura, Inc. asked that the
mortgage be cancelled. The action thus taken by both parties was in the nature of mutual desistance, what Manresa
terms "mutuo disenso", which is a mode of extinguishing obligations. It is a concept that derives from the principle that
since mutual agreement can create a contract, mutual disagreement by the parties can cause its extinguishment.  All
these circumstances demonstrate beyond doubt that the said agreement had been extinguished by mutual desistance,
and that on the initiative of the plaintiff-appellee itself.

68. NETLINK COMPUTER INCORPORATED vs. ERIC DELMO

G.R. NO. 160827, June 18, 2014

Facts:
On November 3, 1991, Netlink Computer, Inc. Products and Services (Netlink) hiredEric S. Delmo (Delmo) as account
manager tasked to canvass and source clients and convince them to purchase the products and services of Netlink.
Delmo worked in the field most of the time. He and his fellow account managers were not required toaccomplish time
cards to record their personal presence in the office of Netlink. He was able to generate sales worth P35,000,000.00,
more or less, from which he earned commissions amounting to P993,558.89 and US$7,588.30.Later on Netlink issued
several memoranda detailing his supposed infractions of the company’s attendance policy. Despite the memoranda,
Delmo continued to generate huge sales for Netlink. Despite Delmo’s Sales performance he was illegally and unjustly
dismissed. NLRC ruled that Delmo was legally dismissed due to just and valid cause. CA upholds NLRC’s ruling with
modification with the awarding of the commission and 13thmonth pay

Issue: WON the payment of the commissions should be in US dollars

Held: No. The appeal lacks merit. As a general rule, all obligations shall be paid in Philippine currency. However, the
contracting parties may stipulate that foreign currencies may be used for settling obligations. This is pursuant to
Republic Act No. 8183.which provides as follows: Section 1. All monetary obligations shall be settled in the Philippine
currency which is legal tender in the Philippines. However, the parties may agree that the obligation or transaction shall
be settled in any other currency at the time of payment.2.)Finally, we affirm the following justification of the CA in
granting attorney's fees to Delmo, viz:

69. .M. TUASON & CO., INC. VS. JAVIER

G.R. NO. L-28569 February 27, 1970

 FACTS: Petitioner J.M. Tuason & Co., Inc. entered a contract to sell with respondent Ligaya Javier a parcel of land with
10% interest per annum.  It was further stipulated in the contract that upon failure to pay the monthly installment, she is
given a one month grace period to pay such installment together with the monthly installment falling on the said grace
period.  Upon the execution of the contract, respondent religiously paid the monthly installment until January 5,
1962.  Respondent, however, was unable to the pay the monthly installments within the grace period which petitioner,
subsequently, sent a letter to respondent on May 22, 1964 that the contract has been rescinded and asked the
respondent to vacate the said land.  So, upon failure of respondent to vacate the said land, petitioner filed an action to
the Court of First Instance of Rizal for the rescission of the contract. The CFI rendered a decision in favor of.

ISSUE:  Did the CFI erroneously apply Article 1592 of the New Civil Code?

 RULING:  Yes.  Regardless, however, of the propriety of applying Article 1592, petitioner has not been denied substantial
justice under Article 1234 of the New Civil Code.  In this connection, respondent religiously satisfied the monthly
installments for almost eight (8) years or up to January 5, 1962.   Thus, petitioner will be able recover everything that
was due thereto.  Under these circumstances, the SC feel that, in the interest of justice and equity, the decision
appealed from may be upheld upon the authority of Article 1234 of the New Civil Code.

70. ANGELES VS. CALASANZ

G.R. No. L-42283, March 18, 1985

FACTS: On December 19, 1957, defendants-appellants Calasanz and plaintiffs-appellees Angeles and Juani entered into a
contract to sell a piece of land plus 7% interest per annum. The plaintiffs-appellees made a down payment upon the
execution of the contract. They promised to pay the balance in monthly installments until fully paid, the installment
being due and payable on the 19th day of each month. The plaintiffs-appellees paid the monthly installments until July
1966.  On January 28, 1967, the defendants-appellants cancelled the said contract because the plaintiffs failed to meet
subsequent payments. The plaintiffs’ letter with their plea for reconsideration of the said cancellation was denied by the
defendants.  The plaintiffs-appellees filed a case before the Court of First Instance to compel the defendant to execute in
the final deed of sale .The Court of First Instance rendered judgment in favor of the plaintiffs, hence this appeal.  

ISSUE: Has the Contract to Sell been automatically and validly cancelled by the defendants-appellants?

RULING: No. The contract to sell, being a contract of adhesion, must be construed against the party causing it. The
Supreme Court agree with the observation of the plaintiffs-appellees to the effect that the terms of a contract must be
interpreted against the party who drafted the same, especially where such interpretation will help effect justice to
buyers.Thus, since the principal obligation under the contract is only P3,920.00 and the plaintiffs-appellees have already
paid an aggregate amount of P4,533.38, the courts should only order the payment of the few remaining installments but
not uphold the cancellation of the contract. Upon payment of the balance of P671.67 without any interest thereon, the
defendant must immediately execute the final deed of sale in favor of the plaintiffs and execute the necessary transfer
of documents, as provided in par.12 of the contract.
71 Rivelisa Realty Inc. vs. First Santa Clara Builders
G.R. No. 189618, January 15, 2014

Facts: A contract to sell covering one residential condominium unit of the Palace of Makati, was entered into by
petitioner and respondent which has been fully paid by the latter on September 24, 1997. Notwithstanding full payment
of the contract price, petitioner failed to complete and deliver the subject unit on time thereby prompting respondent to
file a Complaint for Rescission of Contract with Damages before the HLURB Expanded National Capital Region Field
Office (ENCRFO) which dismissed the complaint. Upon elevation, the HLURB Board of Commissioners reversed and set
aside the HLURB ENCRFO decision and ordered the rescission of the Contract to Sell. Aggrieved, the case was elevated to
the Office of the President until it reached the CA and SC.

Issue: Whether the rescission of the Contract to Sell is proper.

Ruling: Yes, the rescission is proper, Article 1191 of the Civil Code is predicated on a breach of faith by the other party
who violates the reciprocity between them. The breach contemplated in the said provision is the obligor’s failure to
comply with an existing obligation. Incontrovertibly, petitioner had incurred delay in the performance of its obligation
amounting to breach of contract as it failed to finish and deliver the unit to respondent within the stipulated period. The
delay in the completion of the project as well as of the delay in the delivery of the unit are breaches of statutory and
contractual obligations which entitle respondent to rescind the contract, demand a refund and payment of damages.

72. Azcona v. Jamandre

G.R. No. L-30597

Facts Guillermo Azcona leased 80 hectares out of his 150 hectare share in Hacienda Sta. Fe in Negros Occidental to Cirilo
Jamandre. The agreed yearly rental was P7200 and the term was for 3agricultural years beginning 1960. On March 30,
1960, when the first annual rent was due, petitioner was not able to deliver possession of the leased property thus he
“waived” payment of that rental. Respondent only entered the premises on October 26, 1960 after paying P7000, which
was acknowledged by the petitioner in the receipt. On April 6, 1961, the petitioner notified respondent that the contract
of lease was deemed cancelled for violation of the conditions of the contract. Earlier, in fact, the respondent had been
ousted from the possession of the 60 hectares of the leased premises and let with only 20 hectares of the original area.

Issues WON the lease contract is deemed cancelled upon failure of the respondent to Attach the parcelary plan

Ruling No. Art 1235provides that When the obligee accepts the performance, knowing its incompleteness or
irregularity,and without expressing any protest or objection, the obligation is deemed fully complied with. The correct
view is that there was an agreed subject-matter, although it was not expressly defined because the plan was
not annexed and never approved. There was still an ascertainable object because the leased premises were sufficiently
delineated and identified. Failure to attach the plan was imputable to the petitioner himself because he was supposed to
prepare the said plan. Nevertheless, the identification of the lease area rendered the plan unnecessary and its absence
did not nullify the agreement.

73. SPOUSES MINIANO B. DELA CRUZ VS. CONCEPCION

G.R. No. 172825               October 11, 2012

FACTS: On March 25, 1996, petitioners entered into a Contract to Sell with respondent (involving a house and lot for a
consideration of P2,000,000.00 subject to the terms and conditions. Respondent made the payments total of
P2,000,000.00. Meanwhile, the title to the property was transferred to respondent. Petitioners later reminded
respondent to pay P209,000.00 within three months. They claimed that the said amount remained unpaid, despite the
transfer of the title to the property to respondent. Several months later, petitioners made further demands stating the
supposed correct computation of respondent’s liabilities. Despite repeated demands, petitioners failed to collect the
amounts they claimed from respondent.
ISSUE: w/n the trial court erred in dismissing the complaint on the ground that plaintiff failed to formally offer their
evidence.
HELD: No.The petition is without merit. It is undisputed that the parties entered into a contract to sell a house and lot
for a total consideration of P2 million. Considering that the property was payable in installment, they likewise agreed on
the payment of interest as well as penalty in case of default. It is likewise settled that respondent was able to pay the
total purchase price of P2 million ahead of the agreed term. After which, they agreed on the remaining balance by way
of interest and penalties which is P200,000.00. Considering that the term of payment was not strictly followed and the
purchase price had already been fully paid by respondent, the latter presented to petitioners her computation of her
liabilities for interests and penalties which was agreed to by petitioners. Petitioners also manifested their conformity to
the statement of account prepared by respondent

74. Aranas v Tutaan

127 SCRA 828

Facts: The stocks of Universal Textile Mills (UTEX) were issued to co-defendants Manuel and Castaneda. Subsequently, in
1971, the lower court declared that Luisa Aranas is the rightful owner of the 400 shares of stocks at Universal Textile
Mills. UTEX then filed a motion to clarify the phrase in said decision, The said motion was granted, where the court
ordered UTEX to pay the plaintiff the cash dividends which accrued to the stocks in question after the current decision
was rendered but the cash dividends already paid to the co-defendants before the court decision may not be claimed by
the plaintiffs. The co-defendants filed for a new trial  and the decision was the same as the 1971 ruling. Upon appeal to
the CA, the said ruling was affirmed.

ISSUE: Whether or not there was valid payment

RULING: No. It is elementary that payment made by a judgment debtor to a wrong party cannot extinguish the
obligation of such debtor to its creditor. It was clear in the motion for clarification that all dividends accruing to the said
shares after the rendition of judgment belonged to the Aranas. When UTEX paid the wrong parties, despite its
knowledge and understanding of the final judgment, it is still liable to pay Aranas as the lawful declared owners of the
said shares. The burden to recover the wrong payment is on UTEX and cannot be passed on to the Aranas as the
innocent parties.

75. Allied Banking Corp. V. Lim Sio Wan (2008)

G.R. No. 133179, March 27, 2008

FACTS:  Lim Sio Wan deposited with Allied Banking Corporation (Allied) a money market placement of P 1,152,597.35 for
a term of 31 days. December 5, 1983: a person claiming to be Lim Sio Wan called up Cristina So, an officer of Allied, and
instructed the latter to pre-terminate Lim Sio Wan’s money market placement, to issue a manager’s check representing
the proceeds of the placement, and to give the check to Deborah Dee Santos who would pick up the check.  Lim Sio Wan
described the appearance of Santos. Santos arrived at the bank and signed the application form for a manager’s check to
be issued. The bank issued Manager’s Check representing the proceeds of Lim Sio Wan’s money market placement in
the name of Lim Sio Wan, and Upon the presentment of the check, Allied funded the check even without checking the
authenticity.

ISSUE: W/N Allied should be solely liable to Lim Sio Wan.

HELD: YES. CA affirmed.  Modified Producers Bank to reimburse Allied and Metrobank. Art. 1953. A person who receives
a loan of money or any other fungible thing acquires the ownership thereof, and is bound to pay to the creditor an equal
amount of the same kind and quality. Given the relative participation of Allied and Metrobank to the instant case, both
banks cannot be adjudged as equally liable. Hence, the 60:40 ratio of the liabilities of Allied and Metrobank, as ruled by
the CA, must be upheld.
76. NAPOCOR vs. Lucman Ibrahim et al
G.r. No. 175963, February 18, 2015

Facts: On November 23, 1994, respondent Ibrahim, in his personal capacity and in behalf of his co-heirs instituted an
action against petitioner National Power Corporation (NAPOCOR) for recovery of possession of land and damages before
the Regional Trial Court (RTC) of Lanao del Sur. On September 19, 1992, respondent Omar G. Maruhom requested the
Marawi City Water District for a permit to construct and/or install a motorized deep well but his request was turned
down. respondents demanded that NAPOCOR pay damages and vacate the sub-terrain portion of their lands but the
latter refused to vacate much less pay damages.

Issue: w/n respondents are entitled to just compensation which hinges upon who owns the sub-terrain area occupied
by petitioner.

Held: Yes. In the present case, petitioner failed to point to any evidence demonstrating grave abuse of discretion on the
part of the CA or to any other circumstances which would call for the application of the exceptions to the above
rule. Consequently, the CAs findings which upheld those of the trial court that respondents owned and possessed the
property and that its substrata was possessed by petitioner since 1978 for the underground tunnels, cannot be
disturbed. Moreover, the Court sustains the finding of the lower courts that the sub-terrain portion of the property
similarly belongs to respondents.