Angeles University Foundation

School of Law
A.Y. 2020-2021

JUCO, APRIL ELENOR C.

JD4

1. Can you file an independent civil action without making any

reservation?

YES, an independent civil action can be filed without making any

reservation.

Under Article 31 of the Civil Code, when the civil action is based on an
obligation not arising from the act or omission complained of as a felony, such
civil action may proceed independently of the criminal proceedings and
regardless of the result of the latter. Section 1 of the present Rule 111 of the
Revised Rules of Criminal Procedure provides that what is “deemed instituted”
with the criminal action is only the action to recover civil liability arising from
the crime or ex-delicto. All the other civil actions under Articles 32, 33, 34 and
2176 of the New Civil Code are no longer “deemed instituted,” and may be filed
separately and prosecuted independently even without any reservation in the
criminal action. The failure to make a reservation in the criminal action is not a
waiver of the right to file a separate and independent civil action based on
these articles of the Civil Code.

Other special laws also recognize the right to initiate independent civil
actions without making reservation such as Article 35 of the Labor Code,
Section 5 of the Anti-Sexual Harassment Act of 1995 and Section 45 of the
Philippine Competency Act. The only limitation is that the offended party
cannot recover twice for the same act or omission of the defendant. This is
because Article 2177 of the Civil Code bars a party from recovering damages
twice upon the same act or omission.

Based on the above discussion, reservation is no longer required since

simultaneous filing is allowed for independent civil actions under Articles 32,
33, 34, and 2176 of the Civil Code and other special laws.

2. If the accused died in an obligation arising from delict, will there be

civil liability? If yes, who will be civilly liable?

NO, the death of the accused extinguished his civil liability arising from
crime.
 Angeles University Foundation
School of Law
A.Y. 2020-2021

Under Article 89 of the Revised Penal Code, the death of the accused
totally extinguishes his criminal liability at any stage of the proceeding. His
civil liability arising from the crime, being civil liability ex delicto, is likewise
extinguished by his death. Section 4 of Rule 111 of the Rules of Criminal
Procedure provides that the death of the accused after arraignment and during
the pendency of the criminal action shall extinguish the civil liability arising
from delict.

In People v. Bayotas, which was cited in a catena of cases, had laid

down the following guidelines:

1. Death of the accused pending appeal of his conviction extinguishes his

criminal liability as well as the civil liability based solely thereon. As opined by
Justice Regalado, in this regard, the death of the accused prior to final
judgment terminates his criminal liability and only the civil liability directly
arising from and based solely on the offense committed, i.e., civil liability ex
delicto in senso strictiore.

2. Corollarily, the claim for civil liability survives notwithstanding the death of
the accused, if the same may also be predicated on a source of obligation other
than delict.

3. Where the civil liability survives, as explained in Number 2 above, an action

for recovery therefor may be pursued but only by way of filing a separate civil
action and subject to Section 1, Rule 111 of the 1985 Rules on Criminal
Procedure as amended. This separate civil action may be enforced either
against the executor/administrator or the estate of the accused, depending on
the source of obligation upon which the same is based as explained above.

4. Finally, the private offended party need not fear a forfeiture of his right to file
this separate civil action by prescription, in cases where during the prosecution
of the criminal action and prior to its extinction, the private-offended party
instituted together therewith the civil action. In such case, the statute of
limitations on the civil liability is deemed interrupted during the pendency of
the criminal case, conformably with [the] provisions of Article 1155 of the Civil
Code, that should thereby avoid any apprehension on a possible privation of
right by prescription.

Only civil liability predicated on a source of obligation other than the

delict survived the death of the accused, which the offended party can recover
by means of a separate civil action. The independent civil actions separately
instituted under Arts. 32, 33, 34 and 2176 of the Civil Code, or those instituted
to enforce liability arising from other sources of obligation may be continued
against the estate or legal representative of the accused after proper
substitution or against his estate.

Based on the foregoing provision of law, death of the accused before final
judgment relieves the accused of both criminal and civil liability arising from
 Angeles University Foundation
School of Law
A.Y. 2020-2021

crime. Corollarily, the claim for civil liability arising from other sources of
obligation other than delict survives notwithstanding the death of the accused.

3. If the transaction is usurious, can you invoke Usury Law? If not, what
can be the remedy of an aggrieved person?

No, if the transaction is usurious, the Usury Law cannot be invoked.

Under Article 1175 of the New Civil Code, usurious transactions shall be
governed by special laws. The Usury Law, a special law, which regulates the
amount of interest that can be charged on a loan was suspended by virtue of
Central Bank Circular No. 905 effective Jan. 1, 1983, which grants parties to a
loan agreement were given wide latitude to agree on any interest rate. With the
suspension of the Usury Law and the removal of interest ceilings, the parties
are generally free to stipulate the interest rates to be imposed on monetary
obligations. As a rule, the interest rate agreed by the creditor and the debtor is
binding upon them. This rule, however, is not absolute. The Supreme Court
has declared that nothing in the said circular grants lenders carte blanche
authority to raise interest rates to levels which will either enslave their
borrowers or lead to a hemorrhaging of their assets. The stipulated interest
rates are considered illegal if they are unconscionable.

The aggrieved party may invoke the authority of the Court in order for
the usurious interest be declared void. In the case of Trade & Investment
Development Corporation of the Philippines vs. Roblett Industrial Construction
Corporation (G.R. No. 139290, 9 May 2006), the Supreme Court dealt with the
validity of an interest rate agreed upon by the parties. According to the
Supreme Court, stipulated interest rates are illegal if they are unconscionable
and the Court is allowed to temper interest rates when necessary. In exercising
this vested power to determine what is iniquitous and unconscionable, the
Court must consider the circumstances of each case. What may be iniquitous
and unconscionable in one case, may be just in another. However,
notwithstanding
stipulations of usurious interest, the debtor must still pay the principal debt.

4. Can you consider corona virus as a fortuitous event? What can be its
effect to a contract?

By its very nature, COVID-19 and the resulting ECQ may fall under the
general definition of force majeure. Under Article 1174 of the New Civil Code,
no person shall be responsible for those events which, could not be foreseen, or
which, though foreseen, were inevitable except in cases expressly specified by
the law, or when otherwise stipulated or the nature of the obligation requires
the assumption of risk. Fortuitous event or force majeure refers to
 Angeles University Foundation
School of Law
A.Y. 2020-2021

extraordinary events not foreseeable or avoidable, events that could not be

foreseen, or which, though foreseen, are inevitable. Justice Jurado, opined that
the definition of fortuitous event is “broad enough to comprehend “acts of God”
or those which are absolutely independent of human intervention, such as
rains, typhoons, floods, cyclones, earthquakes or any other similar calamity
brought about by natural forces. It is also broad enough to include “force
majeure or events” which arise from legitimate or illegitimate acts of persons
other than the obligor, such as commotions, riots, wars, robbery and similar
acts.

Generally, no person shall be liable in cases of fortuitous event provided

that the following elements are present:
1. The cause of the breach of the obligation must be independent of the will
of the debtor;
2. The event must either be unforeseeable or unavoidable;
3. The event must be such as to render it impossible for the debtor to fulfill
his obligation in a normal manner; and
4. The debtor must be free from any participation in, or aggravation of the
injury.

Parenthetically, the debtor is responsible for a fortuitous event:

1. When expressly declared by law;
2. When expressly declared by stipulation or contract; and
3. When the nature of the obligation requires the assumption of risk.

Parties, by stipulation or contract, may expand or restrict the ambit of

what constitutes a fortuitous event. In certain cases, the contract may provide
for a stipulation imposing liability even in cases of fortuitous events and the
same shall be binding upon the parties. The contract may likewise provide for a
particular procedure to be observed once an alleged fortuitous event occurs.
The prerequisites to be satisfied in the event of force majeure may differ from
one contract to another in line with the principle that parties are free to enter
into agreements and stipulate as to the terms and conditions of their contract.

Consequently, in order to ascertain whether the COVID-19 pandemic is

considered as a fortuitous event, and whether a party is still liable, an
examination of the contract, specifically the force majeure clause, is imperative.

If the contract fails to address the respective liabilities of the parties in

case of fortuitous event, the provisions of the New Civil Code of the Philippines
will apply as it is a basic rule in contracts that the law is deemed written into
the contract between the parties. However, the application of the legal concept
of fortuitous event may no longer be necessary for some contracts such as
contracts of lease and loan. Republic Act No. 11469, also known as the
 Angeles University Foundation
School of Law
A.Y. 2020-2021

“Bayanihan to Heal as One,” directs all financial institutions, both public and
private, to implement a minimum of a 30-day grace period for the payment of
all loans falling due within the period of the ECQ without incurring interests,
penalties, fees, or other charges. The said law also provides for a minimum of
30-day grace period, without incurring interests, penalties, fees and other
charges, on residential rents falling due within the period of the ECQ.

While the government seems to lean towards considering the COVID-19

pandemic as a fortuitous event, it may, however, be more prudent for affected
businesses to examine their existing contracts and determine the effect of the
current situation on their obligations and the procedures to be followed to
invoke exemptions.