CASE DIGEST

Article 1157

1. PEOPLE OF THE PHILIPPINES vs. REGELIO BAYOTAS Y CORDOVA.

G.R. No. 102007, September 2, 1994

FACTS:

Rogelio Bayotas, accused and charged with Rape, died on February 4, 1992 due to cardio respiratory arrest.
The Solicitor General then submitted a comment stating that the death of the accused does not excuse him from his
civil liability (supported by the Supreme Court’s decision in People vs Sendaydiego). On the other hand, the counsel
of the accused claimed that in the Supreme Court’s decision in People vs. Castillo, civil liability is extinguished if
accused should die before the final judgment is rendered.

ISSUE:

Whether or not the death of the accused pending appeal of his conviction extinguish his civil liability.

RULING:

The Court decided on this case through stating the cases of Castillo and Sendaydiego. In the Castillo case,
the Court said that civil liability is extinguished only when death of the accused occurred before the final judgement.
Judge Kapunan further stated that civil liability is extinguished because there will be “no party defendant” in the
case. There will be no civil liability if criminal liability does not exist. Further, the Court stated “it is, thus, evident
that… the rule established was that the survival of the civil liability depends on whether the same can be predicated
on the sources of obligations other than delict.

In the Sendaydiego case, the Court issued Resolution of July 8, 1977 where it states that civil liability will
only survive if death came after the final judgement of the CFI of Pangasinan. However, Article 30 of the Civil
Code could not possibly lend support to the ruling in Sendaydiego. Civil liability ex delicto is extinguished by the
death of the accused while his conviction is on appeal. The Court also gave a summary on which cases should civil
liability be extinguished, to wit:

Death of the accused pending appeal of his conviction extinguishes his criminal liability as well as the civil
liability based solely thereon. Therefore, Bayotas’s death extinguished his criminal and civil liability based solely on
the act complained of.

2. LYDIA VILLEGAS, MA TERESITA VILLEGAS, ANTONIO VILLEGAS, JR., and ANTONIETTE

VILLEGAS vs. THE COURT OF APPEALS, PEOPLE OF THE PHILIPPINES and ANTONIO V.
RAQUIZA

G.R. No. 82562 April 11, 1997

ANTONIO V. RAQUIZA vs. COURT OF APPEALS, LYDIA A. VILLEGAS, ANTONIO VILLEGAS, JR.,
MA. ANTONETTE VILLEGAS, MA. LYDIA VILLEGAS and ESTATE OF ANTONIO J. VILLEGAS

G.R. No. 82592 April 11, 1997

FACTS: This case originated from a libel suit filed by then Assemblyman Antonio V. Raquiza against then Manila
Mayor Antonio J. Villegas, who allegedly publicly imputed to him acts constituting violations of the Anti-Graft and
Corrupt Practices Act. He did this on several occasions in August 1968. After losing in the 1971 elections, Villegas
left for the United States where he stayed until his death. Nevertheless, trial for libel case proceeded on absentia.
Two months after the prosecution rested its case, the court issued an order dismissing the criminal aspect of the case
but reserving the right to resolve its civil aspect.

Subsequently the Court awarded Raquiza actual, moral, exemplary damages and cost of suit. Ordering the
estate of Antonio J. Villegas, represented herein by his legal heirs to pay plaintiff Antonio V. Raquiza Two Hundred
Million Pesos (P200,000,000.00), itemized as follows:

On appeal, the CA affirmed but reduced the amount of damages to 2 million. Hence, this petition.

ISSUE: WON the death of the accused before final judgment extinguish his civil liability?

HELD:

1. NO, because the source of Villegas’ civil liability in the present case is the felonious act of libel he allegedly
committed. and, this act could also be deemed a quasi-delict within the purview of Article 33 in relation to Article
1157 of the Civil Code.

2. Article 33 of the Civil Code provides Raquiza’s right to recover damages arose from this article not from delict.

3. Also, Article 1157 of the Civil Code enumerates these other sources of obligation from which the civil liability
may arise as a result of the same act or omission:

a) Law d) Act or omissions punished by law

b) Contracts e) Quasi-delicts

c) Quasi-contracts

4. Now, If the court ruled in People v. Bayotas that the death of an accused during the pendency of his appeal
extinguishes not only his criminal as well as the civil liability unless the latter can be predicated on a source of
obligation other than the act or omission complained, with more reason should it apply to the case at bar where the
accused died shortly after the prosecution rested its case and before he was able to submit his memorandum and all
this before any decision could even be reached by the trial court.

5. The Bayotas ruling, however, makes the enforcement of a deceased accused’s civil liability dependent on two
factors, namely, that it be pursued by filing a separate civil action and that it be made subject to the Rules on
Criminal Procedure.

6. Obviously, in the case at bar, the civil action was deemed instituted with the criminal. There was no waiver of the
civil action and no reservation of the right to institute the same, nor was it instituted prior to the criminal action.

7. What then is the recourse of the private offended party in a criminal case such as this which must be dismissed in
accordance with the Bayotas doctrine, where the civil action was impliedly instituted with it?

8. The answer is likewise provided in Bayotas, thus:

Assuming that for lack of express reservation, Belamala’s civil action for damages was to be considered
instituted together with the criminal action still, since both proceedings were terminated without finals adjudication,
the civil action of the offended party under Article 33 may yet be enforced separately.

9. Hence, logically, the court should have dismissed both actions against Villegas which dismissal will not however,
bar Raquiza as the private offended party from pursuing his claim for damages against the executor or administrator
of Villegas estate. Notwithstanding the fact that he did not reserve the right to institute a civil action based on Article
33 of the Civil Code.
 Article 1158

1. ARTURO PELAYO VS. MARCELO LAURON ET. AL.

GR No. L-4089, January 12, 1909

FACTS:

Petitioner Pelayo, a physician, rendered a medical assistance during the child delivery of the daughter-in-
law of the defendants. The just and equitable value of services rendered by him was P500.00 which the defendants
refused to pay without alleging any good reason. With this, the plaintiff prayed that the judgment be entered in his
favor as against the defendants for the sum of P500.00 and costs.

The defendants denied all of the allegation of the plaintiff, contending that their daughter-in-law had died in
consequence of the child-birth, and that when she was alive, she lived with her husband independently and in a
separate house, that on the day she gave birth she was in the house of the defendants and her stay there was
accidental and due to fortuitous circumstances.

ISSUE:

Whether or not the defendants are obliged to pay the petitioner for the medical assistance rendered to their
daughter-in-law.

HELD:

According to Article 1089 of the Old Civil Code (now 1157), obligations are created by law, by contracts,
by quasi-contracts, by illicit acts and omissions or by those which any kind of fault or negligence occurs.
Obligations arising from law are not presumed. Those expressly determined in the Code or in special law, etc., are
the only demandable ones.

The rendering of medical assistance in case of illness is comprised among the mutual obligations to which
the spouses are bound by way of mutual support as provided by the law or the Code. Consequently, the obligation to
pay the plaintiff for the medical assistance rendered to the defendant’s daughter-in-law must be couched on the
husband.

In the case at bar, the obligation of the husband to furnish his wife in the indispensable services of a
physician at such critical moments is especially established by the law and the compliance therewith is unavoidable.

2. LEUNG BEN VS. P.J. OBRIEN

G.R. No. L-13602 April 6, 1918

FACTS:

Upon December 12, 1917, an action was instituted in the Court of First Instance of the city of Manila by P.
J. O'Brien to recover of Leung Ben the sum of P15,000 alleged to have been lost by the plaintiff to the defendant in
a series of gambling, banking and percentage games conducted ruing the two or three months prior to the institution
of the suit. In his verified complaint the plaintiff asked for an attachment, under section 424, and 412 (1) of the Code
of Civil Procedure, against the property of the defendant, on the ground that the latter was about to depart from the
Philippine islands with intent to defraud his creditors. This attachment was issued; and acting under the authority
thereof, the sheriff attached the sum of P15,000 which had been deposited by the defendant with the International
Banking Corporation.
ISSUE:

Whether or not Leung Ben has the legal basis to recover the money he lost to O’brien in a series of
gambling, banking and percentage games.

HELD:

YES. As a general rule, money lost in gaming and voluntarily paid by the loser to the winner cannot in the
absence of statue, be recovered in a civil action. But Act No. 1757 of the Philippine Commission, which defines and
penalizes several forms of gambling, contains numerous provisions recognizing the right to recover money lost in
gambling or in the playing of certain games (secs. 6, 7, 8, 9, 11). The original complaint in the action in the Court of
First Instance is not clear as to the particular section of Act No. 1757 under which the action is brought, but it is
alleged that the money was lost at gambling, banking, and percentage game in which the defendant was banker. It
must therefore be assumed that the action is based upon the right of recovery given in Section 7 of said Act, which
declares that an action may be brought against the banker by any person losing money at a banking or percentage
game.

Is this a cause arising upon contract, express or implied, as this term is used in section 412 of the Code of
Civil Procedure?

In the case now under consideration the duty of the defendant to refund the money which he won from the
plaintiff at gaming is a duty imposed by statute. It therefore arises ex lege (as a matter of law). Furthermore, it is a
duty to return a certain sum which had passed from the plaintiff to the defendant. By all the criteria which the
common law supplies, this a duty in the nature of debt and is properly classified as an implied contract. It is well-
settled by the English authorities that money lost in gambling or by lottery, if recoverable at all, can be recovered by
the loser in an action of indebitatus assumpsit for money had and received. This means that in the common law the
duty to return money won in this way is an implied contract, or quasi-contract.

Article 1159

1. ROMAN CATHOLIC OF MALOLOS VS. IAC

FACTS:

The property subject matter of the contract consists of a parcel of land in the Province of Bulacan, issued
and registered in the name of the petitioner which it sold to the private respondent.

On July 7, 1971, the subject contract over the land in question was executed between the petitioner as
vendor and the private respondent through its then president, Mr. Carlos F. Robes, as vendee, stipulating for a
downpayment of P23,930.00 and the balance of P100,000.00 plus 12% interest per annum to be paid within four (4)
years from execution of the contract. The contract likewise provides for cancellation, forfeiture of previous
payments, and reconveyance of the land in question in case the private respondent would fail to complete payment
within the said period.

After the expiration of the stipulated period for payment, Atty. Adalia Francisco (president of the company
who bought land) wrote the petitioner a formal request that her company be allowed to pay the principal amount of
P100,000.00 in three (3) equal installments of six (6) months each with the first installment and the accrued interest
of P24,000.00 to be paid immediately upon approval of the said request.

The petitioner formally denied the said request of the private respondent, but granted the latter a grace
period of five (5) days from the receipt of the denial to pay the total balance of P124,000.00. The private respondent
wrote the petitioner requesting an extension of 30 days from said date to fully settle its account but this was still
denied. Consequently, Atty. Francisco wrote a letter directly addressed to the petitioner, protesting the alleged
refusal of the latter to accept tender of payment made by the former on the last day of the grace period. But the
private respondent demanded the execution of a deed of absolute sale over the land in question

Atty. Fernandez, wrote a reply to the private respondent stating the refusal of his client to execute the deed
of absolute sale so the petitioner cancelled the contract and considered all previous payments forfeited and the land
as ipso facto reconveyed. From a perusal of the foregoing facts, we find that both the contending parties have
conflicting versions on the main question of tender of payment.

According to the trial court:

. . . What made Atty. Francisco suddenly decide to pay plaintiff’s obligation on tender her payment, when
her request to extend the grace period has not yet been acted upon? Atty. Francisco’s claim that she made a tender of
payment is not worthy of credence.

The trial court considered as fatal the failure of Atty. Francisco to present in court the certified personal
check allegedly tendered as payment or, at least, its xerox copy, or even bank records thereof.

Not satisfied with the said decision, the private respondent appealed to the IAC. The IAC reversed the
decision of the trial court. The IAC, in finding that the private respondent had sufficient available funds, ipso facto
concluded that the latter had tendered payment.

ISSUE:

Whether or not the finding of the IAC that Atty. Francisco had sufficient available funds did tender
payment for the said obligation.

Whether or not an offer of a check is a valid tender of payment of an obligation under a contract which
stipulates that the consideration of the sale is in Philippine Currency.

HELD:

1. No. Tender of payment involves a positive and unconditional act by the obligor of offering legal tender currency
as payment to the obligee for the former’s obligation and demanding that the latter accept the same. Thus, tender of
payment cannot be presumed by a mere inference from surrounding circumstances. At most, sufficiency of available
funds is only affirmative of the capacity or ability of the obligor to fulfill his part of the bargain. The respondent
court was therefore in error.

2. No. In the case of Philippine Airlines v. Court of Appeals:

Since a negotiable instrument is only a substitute for money and not money, the delivery of such an
instrument does not, by itself, operate as payment. A check, whether a manager’s check or ordinary check, is not
legal tender, and an offer of a check in payment of a debt is not a valid tender of payment and may be refused receipt
by the obligee or creditor. The tender of payment by the private respondent was not valid for failure to comply with
the requisite payment in legal tender or currency stipulated within the grace period.

The DECISION of the IAC is hereby SET ASIDE and ANNULLED and the DECISION of the trial court
is REINSTATED.

2. OLLENDORF VS ABRAHAMSON

38 Phil. 585

FACTS: The record discloses that Ollendorf is and for a long time past has been engaged in the city of Manila and
elsewhere in the Philippines in the business of manufacturing ladies' embroidered underwear for export. Ollendorf
imports the material from which this underwear is made and adopts decorative designs which are embroidered upon
it by Filipino needle workers from patterns selected and supplied by him. Most of the embroidery work is done in
the homes of the workers. The embroiderers employed by plaintiff are under contract to work for plaintiff
exclusively. 

On September 1915, plaintiff and defendant entered into a contract. Under the terms of this, agreement
defendant entered the employ of plaintiff and worked for him until April 1916, when defendant, on account of ill
health, left plaintiff's employ and went to the United States. While in plaintiff's employ defendant had access to all
parts of plaintiff's establishment, and had full opportunity to acquaint himself with plaintiff's business methods and
business connections. The duties performed by him were such as to make it necessary that he should have this
knowledge of plaintiff s business. Defendant had a general knowledge of the Philippine embroidery business before
his employment by plaintiff, having been engaged in similar work for several years. 

Some months after his departure, defendant returned to Manila as the manager of the Philippine Underwear
Company, a corporation. This corporation does not maintain a factory in the Philippine Islands, but sends material
and embroidery designs from New York to its local representative here who employs Filipino needle workers to
embroider the designs and make up the garments in their homes. The only difference between plaintiff's business
and that of the firm by which the defendant is employed, is the method of doing the finishing work — the
manufacture of the embroidered material into finished garments. 

Shortly after defendant's return to Manila and the commencement by him of the discharge of the duties of
his position as local manager of the Philippine Embroidery Company, plaintiff commenced this action, the principal
purpose of which is to prevent, by injunction, any further breach of that part of defendant's contract of employment
by plaintiff, by which he agreed that he would not "enter into or engage himself directly or indirectly . . . in a similar
or competitive business to that of (plaintiff) anywhere within the Philippine Islands for a period of five years . . ."
from the date of the agreement. 

ISSUE: Whether or not the said contract is valid. 

RULING: The contract is a valid one. The only limitation upon the freedom of contractual agreement is that the
pacts established shall not be contrary to "law, morals or public order." (Civil Code, art. 1255.) 

Public welfare is first considered, and if it be not involved, and the restraint upon one party is not greater
than protection to the other party requires, the contract may be sustained. The question is whether, under the
particular circumstances of the case and the nature of the particular contract involved in it the contract is, or is not,
unreasonable. 

The Courts adopt the modern rule that the validity of restraints upon trade or employment is to be
determined by the intrinsic reasonableness of the restriction in each case, rather than by any fixed rule, and that such
restrictions may be upheld when not contrary to the public welfare and not greater than is necessary to afford a fair
and reasonable protection to the party in whose favor it is imposed. 

A business enterprise may and often does depend for its success upon the owner's relations with other
dealers, his skill in establishing favorable connections, his methods of buying and selling — a multitude of details,
none vital if considered alone, but which in the aggregate constitute the sum total of the advantages which are the
result of the experience or individual aptitude and ability of the man or men by whom the business has been built up.
Failure or success may depend upon the possession of these intangible but all-important assets, and it is natural that
their possessor should seek to keep them from falling into the hands of his competitors. 

It is with this object in view that such restrictions as that now under consideration are written into contracts
of employment. Their purpose is the protection of the employer, and if they do not go beyond what is reasonably
necessary to effectuate this purpose they should be upheld. We are of the opinion, and so hold, that in the light of the
established facts the restraint imposed upon defendant by his contract is not unreasonable.
 3. THE CITY OF CEBU VS. SPOUSES APOLONIO OF BLASA DEDAMO

GR No. 142971, 5-7-2002

FACTS:

On 17 September 1993, Petitioner City of Cebu filed a complaint for eminent domain against respondent
spouses Apolonio and Blasa Dedamo. 

The petitioner alleged therein that it needed the land for a public purpose, i.e., for the construction of a
public road which shall serve as an access/relief road of Gorordo Avenue to extend to the General Maxilum Avenue
and the back of Magellan International Hotel Roads in Cebu City. 

The lower court fixed the amount of just compensation at P20,826,339.50. Petitioner alleged that the lower
court erred in fixing the amount of just compensation at P20, 826,339.50. 

The just compensation should be based on the prevailing market price of the property at the
commencement of the expropriation proceedings. The petitioner did not convince the Court of Appeals, which
affirmed the lower court’s decision in toto.

Hence, this petition for review on certiorari,

ISSUE: Whether or not just compensation should be determined as of the date of the filing of the complaint.

HELD:

1. No. In the case at bar, the applicable law for the determination of just compensation is Section 19 of R.A. No.
7160, which expressly provides that just compensation shall be determined as of the time of actual taking.

2. The petitioner has misread the ruling in The National Power Corp. vs. Court of Appeals that just compensation
should be determined as of the date of the filing of the complaint.

3. The Court of Appeals did not err in affirming the decision of the trial court because the trial court decided the case
on the basis of the agreement of the parties that just compensation shall be fixed by commissioners appointed by the
court.

4. Also, the parties, by a solemn document freely and voluntarily agreed upon by them, agreed to be bound by the
report of the commission and approved by the trial court.

5. The agreement is a contract between the parties. It has the force of law between them and should be complied
with in good faith.

6. Article 1159 and 1315 of the Civil Code explicitly provides:

7. Art. 1159. Obligations arising from contracts have the force of law between the contracting parties and should be
complied with in good faith.

8. and, Art. 1315. Contracts are perfected by mere consent, and from that moment the parties are bound not only to
the fulfilment of what has been expressly stipulated but also to all the consequences which, according to their nature,
may be in keeping with good faith, usage and law.

9. Furthermore, during the hearing petitioner did not interpose a serious objection and Records show that petitioner
consented to conform with the valuation recommended by the commissioners.

10. It is therefore too late for petitioner to question the valuation now without violating the principle of equitable
estoppel. Estoppel in pais arises when one, by his acts, representations or admissions, or by his own silence when he
ought to speak out, intentionally or through culpable negligence, induces another to believe certain facts to exist and
such other rightfully relies and acts on such belief, so that he will be prejudiced if the former is permitted to deny the
existence of such facts.

11. Finally, while Section 4, Rule 67 of the Rules of Court provides that just compensation shall be determined at
the time of the filing of the complaint for expropriation,13 such law cannot prevail over R.A. 7160, which is a
substantive law.14

WHEREFORE, finding no reversible error in the assailed judgment on the Court of Appeals in CA-G.R. CV No.
59204, the petition in this case is hereby DENIED.No pronouncement as to costs.

Article 1163

1. THE ROMAN CATHOLIC BISHOP OF JARO vs. GREGORIO DELA PEÑA

GR. No. L-6913, 11-21-1913

FACTS: In 1898 Fr. De la Peña assigned as trustee of the sum of P6,641, collected by him for the charitable
purposes he deposited in his personal account P19,000 in the Hongkong and Shanghai Bank at Iloilo. During the war
of the revolution, Father De la Peña was arrested by the military authorities as a political prisoner. The arrest of
Father De la Peña and the confiscation of the funds in the bank were the result of the claim of the military authorities
that he was an insurgent and that the funds deposited had been collected by him is for revolutionary purposes. The
money was taken from the bank by the military authorities by virtue of such order, was confiscated and turned over
to the Government.

ISSUES: Whether or not Father De la Peña is liable for the loss of the funds?

RULING: No, he is not liable because there is no negligent act on the part of Fr. De la Peña. It was so happened
that during that time the money was taken from him by the U.S. military forces which is unforeseen event. Although
the Civil Code states that “a person obliged to give something is also bound to preserve it with the diligence
pertaining to a good father of a family”, it also provides, following the principle of the Roman law that “no one shall
be liable for events which could not be foreseen, or which having been foreseen were inevitable, with the exception
of the cases expressly mentioned in the law or those in which the obligation so declares.”

2. ENGRACIO OBEJERA and MERCEDES INTAK VS. IGA SY

C.A. No. 34, April 29, 1946

FACTS:

1. This case is an appeal filed against the decision of the Court of First Instance of Batangas annulling, on the
ground of force and intimidation, the deed of transfer, whereby the plaintiffs agreed to transfer to the defendant their
property in case they failed to return to the defendant the balance and pieces of jewelry allegedly deposited with the
plaintiffs during the Japanese invasion.

2. During the Japanese invasion plaintiffs and defendant sought refuge in the house of Leon Villena, barrio
lieutenant of Batangas and after consultation with their host Leon Villena, they decided to hide their things and
valuables in a dug-out belonging to Leon Villena.

3. After a month the defendant who desired to move to another house, they went back to the dug-out to take out the
defendant's container and discovered, that their money and things, except for a few papers, had been lost.

4. In this case the defendant (Iga Sy) contends that she deposited her money and jewelry with the plaintiffs and that
the plaintiffs, acknowledging liability for the loss of her money and jewelry, offered to transfer their property.
5. On the other hand, the plaintiffs deny the alleged deposit, deny knowledge of the loss of the defendant's money
and jewelry, and claim that their consent to the deed of transfer was obtained through violence and intimidation.

ISSUE: WON the plaintiffs (OBEJERA and INTAK) are liable for the loss of the defendant's money and jewelry?

HELD:

1. No, under Article 1163 of the Civil Code states that "a person obliged to give something is also bound to preserve
it with the diligence pertaining to a good father of a family"

2. After a careful consideration of the evidences of this case, the contention of the defendant (Iga Sy) cannot be
sustained. The alleged deposit cannot be believed and is contrary to the ordinary course of nature and the ordinary
habits of life.

3. It should also be considered, that the dug-out into which the plaintiffs and the defendant hid their money and
valuables belongs to Leon Villena;

4. that the plaintiffs and the defendant only sought refuge in his house; that neither the plaintiffs nor the defendant
had, therefore, control over, or absolute and exclusive access, to the dug-out

5. It is hard to believe that plaintiff Engracio Obejera would assume responsibility over the defendant's things hidden
in a place not belonging to him but to Leon Villena, in whose house they only sought refuge.

6. and especially at a time when the confusion and fear resulting from the Japanese invasion that nobody could be
sure of his own things and even of his life.

7. The more natural conclusion is that plaintiffs and defendant decided to hide their things in the dug-out of their
host Leon Villena, thinking it to be the safest place, and that they might recover them after the confusion and
uncertainty.

8. Even Leon Villena did not offer to his guests to take care of their things by hiding them in his dug-out.

9. Even if the defendant's theory of deposit were sustained, any obligation arising was extinguished upon the loss,
without the fault of the depositee and under circumstances which at the time were inevitable.

10. The evidence of record, shows that the plaintiffs were not in any way responsible for the loss of the defendant's
money and jewelry.

11. It necessarily follows that the deed of transfer, is null and void for lack of cause or consideration. Also the two
documents are also null and void upon the other ground that the consent of the plaintiffs therein was obtained
through duress and intimidation.

Wherefore, the decision of the court a quo is hereby affirmed in toto with costs against the defendant and
appellant. So ordered.