UP-Civil-Law-Pre-Week-2017.pdf

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PERSONS AND FAMILY RELATIONS Q1: WITHOUT FIRST CONSULTING HER HUSBAND ABOUT IT, A WOMAN GETS AN ABORTION TWO MONTHS INTO HER PREGNANCY. ENRAGED UPON DISCOVERY OF THE ABORTION, THE HUSBAND, ON BEHALF OF THEIR ABORTED CHILD, NOW SUES THE DOCTOR RESPONSIBLE FOR THE ABORTION FOR DAMAGES. MAY HE RECOVER? A1: No, the husband may not recover damages on this ground. Art. 40 of the Civil Code clearly states that birth determines personality. Art. 41 meanwhile provides that for civil purposes, the fetus is considered born if it is alive at the time it is completely delivered from the mother’s womb. Thus, “birth” contemplates a complete removal of the fetus from the mother’s womb, before which a fetus is still part of the mother’s internal organs. As explained by the Court in Geluz v. CA [G.R. No. L-16439, July 20, 1961], an aborted fetus never acquired legal rights/civil personality because it was not alive at the time of delivery from the mother’s womb. And if it did not acquire personality or capacity to have rights and obligations, then no damages can be claimed on its behalf on account of injury or death suffered by it either. The Court however did add in the same case that the aggrieved parent of an aborted fetus may recover damages, but such damages must be those inflicted directly upon them as distinguished from the injury or violation of the rights of the unborn fetus. Q2: CAUGHT IN THE MIDDLE OF A SHOOTOUT, THE SPOUSES NAZAL AND THEIR SON TAKE SHELTER IN A DILAPIDATED SHELTER. AFTER SOME TIME OF HIDING BEHIND A WALL, MRS. NAZAL AND THE SON DECIDE TO MAKE A RUN FOR IT. A BULLET IMMEDIATELY CATCHES MRS. NAZAL IN THE HEAD. HER SON, HOWEVER, JUMPS TO SAFETY BEHIND ANOTHER WALL JUST IN TIME. HE STAYS HERE FOR ALMOST TWO HOURS WHEN THE DILAPIDATED SHELTER FROM WHICH HE AND HIS MOTHER HAD JUST FLED IS SUDDENLY ENGULFED IN FLAMES. HIS FATHER DOES NOT COME OUT. THREE HOURS LATER, THE SON DECIDES TO TRY TO LOOK FOR THE FATHER IN THE SHELTER, DESPITE THE FIRE. AS HE RUNS FOR THE SHELTER, HOWEVER, HE IS SHOT. THE FIRE CONTINUES FOR ABOUT TWO HOURS MORE BEFORE IT IS EXTINGUISHED. MR. NAZAL’S CHARRED BODY IS FOUND AND IDENTIFIED. A SURVIVOR OF THE SHOOTOUT TESTIFIES AS EYEWITNESS TO ALL THIS. IT IS ALSO ESTABLISHED THAT AT THE TIME OF THE SHOOTOUT, MR. NAZAL WAS 65 Y/O, MRS. NAZAL WAS 70 Y/O, AND THEIR SON, 25 Y/O. IN WHAT ORDER WILL THE DEATHS BE FOUND TO HAVE OCCURRED? A2: The order of deaths is: Mrs. Nazal first, Mr. Nazal second and their son last. There is no question that Mrs. Nazal died first and that both her son and husband were alive when she did. The question arises as between Mr. Nazal—who is caught in the fire that subsequently breaks out— and his son, who dies 3 hours after said fire begins but 2 hours before it is extinguished. Since there is no way of ascertaining when during the 5-hour fire Mr. Nazal died, the statutory presumption of survivorship applies. Art. 43 will apply in case Mr. Nazal and son “are called to succeed each other,” and they will be presumed to have died simultaneously, with no transmission of rights from each other. If, however, survivorship is contested in a case unrelated to succession, the Rules of Court [Rule 131, Sec. 3 (jj)] applies. According to the Rules, if one of the persons whose order of death is in question is over 60, and the other is between 15 and 60, the latter is deemed to have survived. The son is 25 y/o. and therefore deemed to have survived his father, who was well over 60 during the fire. Thus, Mrs. Nazal died first according to the facts of the case; Mr. Nazal died next and the son last according to Rule 131, Sec. 3 (jj) (5).

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Alternatively ratio: In the case of Joaquin v. Navarro [G.R. No. L-5426, May 29, 1953], the Court explained that mere inference when drawn from established facts and common sense, is enough to overcome the statutory presumption of survivorship laid down by Art. 43 of the Civil Code and Rule 131 (jj) of the Rules of Court. In this case, there is no question that Mrs. Nazal died first and that both her son and husband were alive when she did. There is also no question that it took a full two hours—during which the house where Mr. Nazal was admittedly hiding was on fire—before his son came out of hiding and was shot. It can be reasonably inferred from the length of time that had passed, Mr. Nazal’s age (he was 65), and common sense, that Mr. Nazal died within those three hours that his son was safely hiding behind a wall, whether from the fire or from suffocation from the smoke. Where there are facts, known or knowable, from which a rational conclusion can be made, the presumption does not step in, and the rule of preponderance of evidence controls. The statutory presumptions of survivorship thus find no application. By at least a preponderance of evidence, Mrs. Nazal died first, Mr. Nazal died next and the son last. Q3: JACK AND JILL, BOTH FILIPINO CITIZENS, MARRY. THEIR MARRIAGE IS IMMEDIATELY AN UNHAPPY ONE, AND JILL SOON LEAVES FOR THE UNITED STATES, WHERE SHE IS ABLE TO OBTAIN A DIVORCE DECREE. (A) IS THE DIVORCE OBTAINED BY JILL VALID? (B) DOES JILL’S ACT OF “DESERTION AND SECURING A DIVORCE DECREE” ENTITLE JACK TO AN AWARD OF DAMAGES? DECIDE. A3: The divorce decree is of no legal effect, and the valid marriage between Jack and Jill subsists. The prohibition in our jurisdiction against absolute divorce cannot be circumvented by obtaining a divorce decree in a foreign country, when the one who so obtained it is a Filipino citizen (Jill) to whom Art. 15 of the Civil Code applies. Said article states that Philippine laws relating to family rights and duties or to the status of persons are binding upon its citizens, even if living abroad. (b) Jack’s is entitled to damages. Desertion and securing of an invalid divorce decree by one consort entitles the other to recover moral damages. [Tenchavez v. Escaño, G.R. No. L-19671, November 29, 1965] Q4: MARIA, A FILIPINO, MARRIES ANOTHER FILIPINO. LATER, HOWEVER, MARIA IS NATURALIZED AS AN AMERICAN CITIZEN AND OBTAINS A DIVORCE DECREE. WHAT ARE THE EFFECTS, IF ANY, OF SUCH A DIVORCE DECREE (A) ON HERSELF, AND (B) ON HER FILIPINO SPOUSE? EXPLAIN. A4: (a) The divorce decree is valid and binding upon Maria as a U.S. citizen by virtue of Art. 15 of the Civil Code, which states that laws relating to family rights and duties or to the status or legal capacity of persons are binding upon its citizens. Thus the reckoning point is not necessarily the time of her marriage but the time she obtained the divorce decree [Quita v. Dandan, G.R. No. 124862, December 22, 1998]. By then, as established, Maria was already a U.S. citizen, and so the divorce is valid and recognized as such by our jurisdiction. (b) The valid divorce decree is likewise binding upon the Filipino spouse. The Court has time and again ruled that where a foreign court has granted a divorce between an alien spouse and a Filipino, the decree binds the Filipino spouse as well [Pilapil v. Ibay-Somera, G.R. No. 80116, June 30, 1989]. Whether or not the Filipino spouse may now remarry will depend upon (1) the validity of the divorce decree obtained by his/her spouse; and (2) whether the decree is one that legally dissolves the marriage and capacitates the foreign spouse to remarry, according to Art. 26, par. 2 of the Family Code. Q5: IN ORDER TO PROVE THAT HER HUSBAND IS PSYCHOLOGICALLY INCAPACITATED TO COMPLY WITH HIS ESSENTIAL MARITAL OBLIGATIONS IN A PETITION FOR THE DECLARATION OF NULLITY OF MARRIAGE, NORMA TESTIFIED THAT HER HUSBAND IS A PATHOLOGICAL LIAR WHO SPREADS

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BASELESS RUMORS ABOUT THEIR FAMILY. SHE TESTIFIED THAT HE WAS UNBEARABLY JEALOUS AND HOT-TEMPERED. SHE SHOWED LETTERS WRITTEN TO HER BY HER HUSBAND UNDER VARIOUS PSEUDONYMS, PRETENDING TO BE HER PAST LOVERS OR FICTITIOUS ILLEGITIMATE CHILDREN SEEKING RECOGNITION. SHE ALSO TESTIFIED THAT SHE HAD TO SLEEP IN HER PARENTS’ HOUSE ON MORE THAN ONE OCCASION BECAUSE OF HIS VIOLENT TANTRUMS. HER HUSBAND DENIES THESE ALLEGATIONS AND POINTS OUT THAT ABSENT AN ACTUAL MEDICAL EXAMINATION CONCLUDING THAT HE ACTUALLY SUFFERS FROM SOME PSYCHOLOGICAL ILLNESS, NORMA’S CASE CANNOT PROSPER. IS HE CORRECT? A5: No, Norma’s husband is not correct. The past years have seen a decreasingly restrictive construction of the standards of psychological incapacity under Art. 36 of the Family Code, with the Court relying on the facts on a case-by-case basis. In Marcos v. Marcos [G.R. No. 136490, October 19, 2000] and succeeding cases, the Court in particular ruled that if the totality of evidence presented is enough to sustain a finding of psychological incapacity, there is even no need to resort to the actual medical examination of the person concerned, as such is not a condition sine qua non to a finding of psychological incapacity. The same would, however, strengthen the petitioner’s claim. That said, the Court is also not quick to conclude the psychological incapacity of a validly married spouse. Although medical examination is not an absolute requisite, incapacity must nevertheless be proved from a totality of sufficient evidence rather than from the petitioner spouse’s lone testimony, as ruled in the case of Republic v. Melgar [G.R. No. 139676, March 31, 2006]. Q6: WHAT CHARACTERIZES THE PSYCHOLOGICAL INCAPACITY CONTEMPLATED BY ART. 36 OF THE FAMILY CODE? ARE THERE DEFINITE STANDARDS THAT MUST BE MET IN ORDER FOR A PETITION TO DECLARE NULLITY OF MARRIAGE ON THIS GROUND TO PROSPER? A6: In the case of Santos v. Bedia-Santos [G.R. No. 112019, January 4, 1995], the Court lists three main characteristics of psychological incapacity. The first is gravity, which differentiates total inability to comply with the basic duties of marriage from mere refusal to do so. The second is antecedence; the incapacity contemplated by Art. 36 is and has been deeply ingrained in the person, typically as early as in his/her adolescence, and is already present at the time of celebration of marriage, even though it may manifest only later on. The third characteristic is its incurability. This does not mean that the incapacity need be medically untreatable. It is enough that such treatment, though it exists, is inaccessible or beyond the means of the spouses. These standards put together refer to no less than a mental—rather than merely physical—incapacity to understand and discharge his marital obligations. Although Republic v. Molina [G.R. No. 108763, February 13, 1997] laid down the famous Molina guidelines in interpreting and applying Art. 36 of the Family Code, the same are guidelines not necessarily binding upon the Court. In fact, as can be gleaned by the cases subsequent to it, the Court has favoured a more case-to-case perception of every situation under Art. 36, interpreting this to be more in line with the legislative intent behind the provision. The Committee drafting the Family Code intended for the term “not to be cast in intractable specifics” but be informed by “evolving standards” [Antonio v. Reyes, G.R. No. 155800, March 10, 2006]. Resort to an actual medical examination of the spouse concerned is not even a condition sine qua non to a finding of psychological incapacity, if the totality of evidence convinces the Court that the finding of psychological incapacity can be sustained [Marcos v. Marcos, G.R. No. 136490, October 19, 2000]. Q7: LIZA WAS FOUND ABANDONED AS A NEW BORN INFANT IN OLONGAPO CITY BY SPOUSES DELA CRUZ, A FILIPINO COUPLE. UNABLE TO LOCATE LIZA'S PARENTS, SPS. DELA CRUZ OBTAINED A FOUNDLING CERTIFICATE IN FAVOR OF LIZA. AFTER 2 YEARS, THEY LEGALLY ADOPTED THE BROWN-HAIRED AND BLUE-EYED BABY GIRL. WHEN LIZA WAS 15, SHE WAS ISSUED A PHILIPPINE

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PASSPORT. AFTER FINISHING COLLEGE, LIZA MARRIED AN AMERICAN SOLDIER AND IMMIGRATED TO AMERICA WHERE SHE WAS NATURALIZED AS A US CITIZEN. A FEW YEARS LATER, LIZA WENT BACK TO THE PHILIPPINES FOR GOOD AND BUILT A HOUSE IN OLONGAPO. LIZA NOW WANTS TO RUN AS REPRESENTATIVE OF ZAMBALES. SHE REACQUIRED HER FILIPINO CITIZENSHIP PURSUANT TO RA 9225 AND RENOUNCED HER US CITIZENSHIP. SHE THEN FILED HER CERTIFICATE OF CANDIDACY. LODIE REMA WHO IS ALSO RUNNING FOR THE SAME OFFICE, FILED A PETITION TO CANCEL LIZA'S COC WITH THE COMELEC ON THE GROUND THAT LIZA IS NOT A NATURAL-BORN FILIPINO CITIZEN TO BEGIN WITH AND, THUS, DID NOT RE-ACQUIRE THE SAME WHEN SHE WAS REPATRIATED PURSUANT TO RA 9225. LODIE, IN SUPPORT OF HER CLAIM, POINTS TO LIZA'S FEATURES AND THE FACT THAT SHE WAS FOUND NEAR AN AMERICAN NAVAL BASE. THUS, FOLLOWING THE PRINCIPLE OF JUS SANGUINIS, LIZA CANNOT BE CONSIDERED AS A NATURAL-BORN FILIPINO. WILL LODIE REMA'S PETITION PROSPER? A7: No. The case of Poe Llamanzares v. COMELEC [G.R. No. 221697, March 8, 2016]controls. As in the 1935 Constitution, which was the law applicable to the abovementioned case, the 1987 Philippine Constitution may not expressly mention foundlings as natural-born Filipino citizens, but it shows no discriminatory intent to exclude foundlings either. This is in keeping with the Constitutional mandate to guarantee the basic right to equal protection of the laws. Under Article IV, Section 2 of the 1987 Constitution, "Natural-born citizens are those who are citizens of the Philippines from birth without having to perform any act to acquire or perfect their Philippine citizenship." "Having to perform an act" requires that the act must be personally done by the citizen. In this instance, the determination of foundling status is done not by the child but by the authorities. Further, through the doctrine of incorporation, generally accepted principles of international law form part of the law of the land. The Universal Declaration of Human Rights, UN Convention on the Rights of the Child (UNCRC) and 1966 International Covenant on Civil and Political Right recognize the right of every child to have a nationality at birth and ensure that no child is stateless. The 1930 Hague Convention on Certain Questions Relating to the Conflict of Nationality Laws also states that a foundling is presumed to have the "nationality of the country of birth". Thus, since Liza's parentage cannot be ascertained through no fault of her own, she must be enjoy the presumption of being a natural born Filipino as she was found in the Philippines. This, being a disputable presumption, must be overcome by those who want to prove otherwise. It may also be noted that our laws do not provide that adoption confers citizenship upon the adoptee. Rather, the adoptee must be a Filipino to be adopted, which assumes that Liza was already a citizen when she was adopted by Sps. Dela Cruz. Q8: WHAT ARE THE GROUNDS FOR ANNULMENT OF MARRIAGE? A8: Art. 4 of the Family Code states that a defect in any of the essential requisites for a marriage renders the marriage voidable—or annullable—as provided for in Art. 45. Under the latter provision, annulment may therefore be availed of if any of the following causes existed at the time of marriage: (1) That the party in whose behalf it is sought to have the marriage annulled was 18 years of age or over but below 21, and the marriage was solemnized without the consent of the parents, guardian or person having substitute parental authority over the party, in that order, unless after attaining the age of 21, such party freely cohabited with the other and both lived together as husband and wife; (2) That either party was of unsound mind, unless such party after coming to reason, freely cohabited with the other as husband and wife;

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(3) That the consent of either party was obtained by fraud, unless such party afterwards, with full knowledge of the facts constituting the fraud, freely cohabited with the other as husband and wife; (4) That the consent of either party was obtained by force, intimidation or undue influence, unless the same having disappeared or ceased, such party thereafter freely cohabited with the other as husband and wife; (5) That either party was physically incapable of consummating the marriage with the other, and such incapacity continues and appears to be incurable; or (6) That either party was afflicted with a STD found to be serious and appears to be incurable. It should further be noted that the fraud of which Art. 45 (3) speaks is limited to the cases enumerated in Art. 46 of the Family Code. Q9: WHAT IS THE EFFECT OF THE ABSENCE OF A MARRIAGE LICENSE ON A MARRIAGE AND WHEN IS A MARRIAGE LICENSE UNNECESSARY FOR THE VALIDITY OF A MARRIAGE? A9: The marriage license being a formal requisite under Art. 3 of the Family Code, its absence will, as a general rule, render the marriage void ab initio (Art. 4, FC), so that not even the securing of a license subsequent to the marriage may “cure” such a defect. Chapter 2 of the Family Code also enumerates the 4 instances in which a marriage license becomes unnecessary. Under Art. 27, marriages in articulo mortis may be solemnized without necessity of a marriage license and shall remain valid even if the ailing party subsequently survives. Under Art. 28, a license is not required if the residence of either party is so located that there is no means of transportation to enable such to appear before the local civil registrar. Marriages among Muslims or among members of the ethnic cultural communities may be performed validly without the necessity of marriage license under Art. 33, provided they are solemnized in accordance with their customs, rites or practices. And under Art. 34, no marriage license shall be necessary for the marriage of a man and a woman who have lived together as husband and wife for at least 5 years and without any legal impediment to marry each other. Q10: DISTINGUISH BETWEEN THE RULES OF LEX REI SITAE AND LEX NATIONALI AS APPLIED IN THE PHILIPPINE JURISDICTION. A10: The first paragraph of Art. 16 of the Civil Code embodies the principle of lex rei sitae—real and personal property are subject to the law of the country (situs) where they are situated. The exception lies in the second paragraph, which states that properties subject to intestate and testate succession are governed by the national law of the person whose succession is under consideration. This follows the nationality principle, or what is also known as lex nationali. This principle on the other hand can be found in Art. 15 of the Civil Code, which states that laws relating to family rights and duties, or to the status, condition and legal capacity of persons are binding upon citizens of the Philippines though living abroad.

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AGENCY AND PARTNERSHIP Q11. WHAT ARE THE ELEMENTS OF AGENCY? A11: The following are the essential elements of agency: a) There is consent, express or implied, of the parties to establish the relationship of agency b) The object is the execution of a juridical act in relation to a third person c) The agent acts as a representative and not for himself; and d) The agent acts within the scope of his authority [Rallos v. Felix Go Chan & Sons, G.R. No. L24332, January 31, 1978] Q12: X TELLS HIS AGENT Y THAT HE IS AUTHORIZING HIM TO SELL A PARCEL OF LAND. IF Y EXECUTES A DEED OF SALE WITH A THIRD PARTY, IS THE SALE VALID? A12: No, the sale is not valid. When a sale of a piece of land or any interest therein is through an agent, the authority of the latter shall be in writing; otherwise, the sale shall be void [Art. 1874]. Q13: Y IS AN AGENT OF X. IS Y ALLOWED TO APPOINT Z AS HIS SUBSTITUTE? IF SO, WHO WOULD BE LIABLE FOR THE ACTS OF Z? A13: Y is allowed to appoint Z as his substitute only if X has not prohibited him from doing so. If Y so appoints Z as his substitute, Y shall be responsible for the acts of Z: (1) When Y was not given the power to appoint one; (2) When Y was given such power, but without designating the person, and Z was notoriously incompetent or insolvent. [Article 1892] Q14: DEAN NAMED SAM AS HIS AGENT IN ALL OF HIS TRANSACTIONS. AS SUCH, SAM ATTENDED A MEETING WHEREIN HE RESOLVED, AS DEAN’S AGENT, TO FOREGO CASTIEL’S DEBT TO DEAN OF P50,000 SINCE HE OVERHEARD DEAN SAY THAT HE WAS PLANNING ON DOING THIS HIMSELF. WAS SAM’S ACT VALID? A14: No. Their relationship was essentially an agency couched in general terms. As such, this only covered acts of administration no matter how broad the power seems. Additionally, Sam’s act of waiving Castiel’s obligation was one of the specific acts stated in the New Civil Code which needs a special power of attorney. Therefore, the action was invalid. [Art. 1877, Art. 1878] Q15: WHO IS A COMMISSION AGENT AND WHAT IS A GUARANTEE COMMISSION? A15: A commission agent is engaged in selling goods for others and as a result, this agent receives an amount (called commission) as payment for his or her services. A guarantee commission is that received on top of the commission and is an additional compensation for risks of collection. The commission agent may take this but he or she shall bear the risk of collection and he or she must also pay the principal the proceeds of the sale on the same terms agreed upon with the purchaser. [Article 19031908] Q16: MARY KATE AND ASHLEY OLSEN WERE SISTERS AND CO-OWNERS OF A REGISTERED LOT. ON APRIL 21, 1954, THE SISTERS EXECUTED A SPECIAL POWER OF ATTORNEY (SPA) IN FAVOR OF THEIR BROTHER TRENT AUTHORIZING HIM TO SELL IN THEIR BEHALF THE LOT. MARY KATE DIED ON Page 7 of 40

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MARCH 3, 1955. TRENT, DESPITE KNOWING THAT MARY HAD ALREADY DIED, SUBSEQUENTLY SOLD THE LOT TO DUFF & DUFF CO. ON SEPT. 12, 1995. THE DEED OF SALE WAS REGISTERED WITH THE REGISTRY OF DEEDS AND A NEW TCT WAS ISSUED TO DUFF & DUFF CO. AFTER THE ORIGINAL ONE WAS CANCELED. ON MAY 18, 1956, JAKE OLSEN, THE ADMINISTRATOR OF THE INTESTATE ESTATE OF MARY KATE, FILED A COMPLAINT PRAYING THAT THE SALE OF MARY KATE'S UNDIVIDED SHARE BE DECLARED UNENFORCEABLE AND SAID SHARE BE RECONVEYED TO THE ESTATE. IS THE SALE BY TRENT OF MARY KATE'S SHARE AFTER THE LATTER’S DEATH ENFORCEABLE? A16: No. By reason of the very nature of the relationship between principal and agent, agency is extinguished ipso jure upon the death of either principal or agent. Article 1931 is the applicable law. Under this provision, an act done by the agent after the death of his principal is valid and effective only under two conditions, viz: (1) that the agent acted without knowledge of the death of the principal AND (2) that the third person who contracted with the agent himself acted in good faith. Good faith here means that the third person was not aware of the death of the principal at the time he contracted with said agent. These two requisites must concur and the absence of one will render the act of the agent invalid and unenforceable. [Art. 1919; Rallos vs. Felix Go Chan, G.R. No. L-24332, January 31, 1978] Q17: HOW MUST A PARTNERSHIP BE CONSTITUTED? A17: The general rule is that it may be constituted in any form. However, when immovable property and real rights are contributed, a public instrument and an inventory of the properties contributed must be attached to the public instrument in order for the partnership to be valid. [Article 1771] Q18: X AND Y FORMED A PARTNERSHIP, X BEING THE INDUSTRIAL PARTNER AND Y BEING THE CAPITALIST PARTNER. IF X ENGAGES IN BUSINESS FOR HIMSELF, AND Y OBJECTS, WHAT ARE THE REMEDIES AVAILABLE TO Y? A18: The general rule is that an industrial partner cannot engage in business for himself, unless the partnership expressly permits him to do so. If the industrial partner fails to comply with this obligation, the capitalist partner may either: (1) exclude him from the firm; or (2) avail himself of the benefits which the industrial partner may have obtained. In either case, the capitalist partner has a right to damages. [Article 1789] Q19: X AND Y FORMED A PARTNERSHIP, X BEING THE INDUSTRIAL PARTNER AND Y BEING THE CAPITALIST PARTNER. IS Y ALLOWED TO ENGAGE FOR HIS OWN ACCOUNT IN OTHER BUSINESSES? A19: The capitalist partner cannot engage for their own account in any operation which is the kind of business in which the partnership is engaged, unless there is a stipulation to the contrary. [Article 1808] Q20: HARVEY SPECTER ASSOCIATED HIMSELF WITH JESSICA PEARSON AND LOUIS LITT TO FORM A LAW FIRM. AFTER SEVERAL YEARS, SPECTER WROTE A LETTER TO PEARSON AND LITT STATING THAT HE IS WITHDRAWING AND RETIRING FROM THE FIRM AND ASKING FOR A MEETING WITH THE LATTER TO DISCUSS THE MECHANICS OF THE LIQUIDATION. HE SUBSEQUENTLY FILED A PETITION WITH THE SECURITIES AND EXCHANGE COMMISION'S (SEC) SECURITIES INVESTIGATION AND CLEARING DEPARTMENT FOR THE FORMAL DISSOLUTION AND LIQUIDATION OF THE PARTNERSHIP. THE HEARING OFFICER RENDERED A DECISION RULING THAT THE WITHDRAWAL OF SPECTER HAS NOT DISSOLVED THE PARTNERSHIP. ON APPEAL, THE SEC EN BANC REVERSED THE DECISION AND SUCH DECISION AFFIRMED BY THE COURT OF APPEALS. DID THE CA ERR IN ITS DECISION?

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A20: No. Any one of the partners may cause the dissolution of the partnership when no express term was specified for its existence. The birth and life of a partnership at will is predicated on the mutual desire and consent of the partners. The right to choose with whom a person wishes to associate himself is the very foundation and essence of that partnership. Its continued existence is, in turn, dependent on the constancy of that mutual resolve, along with each partner's capability to give it, and the absence of a cause for dissolution provided by the law itself. Verily, any one of the partners may, at his sole pleasure, dictate a dissolution of the partnership at will. He must, however, act in good faith, not that the attendance of bad faith can prevent the dissolution of the partnership, but that it can result in a liability for damages. [Art. 1830(1)(b); Ortega vs. CA, G.R. No. 109248, July 3, 1995] Q21: RIA ASSIGNED HER WHOLE INTEREST IN THE PARTNERSHIP TO JO. JO NOW WISHES TO TAKE PART IN THE DECISION-MAKING AND ADMINISTRATIVE ACTIVITIES OF THE PARTNERSHIP. MAY SHE DO SO? A21: No. The conveyance of a partner of his or her interest does not make the assignee a partner. She cannot interfere in the management or administration of the partnership nor can she require information or inspect the partnership books. She may only receive profits originally allocated for the assignor, avail of the usual remedies in case of fraud and, require an accounting in case of dissolution from the date of the last account agreed to by all the partners. [Article 1813]

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CREDIT TRANSACTIONS Q22: DIFFERENTIATE BETWEEN COMMODATUM AND MUTUUM. A22: Commodatum involves non-consumable things while mutuum involves money or other consumable things. In commodatum, ownership of the thing loaned is retained by the lender, while in mutuum, ownership is transferred to the borrower. Commodatum is essentially gratuitous, while mutuum can be gratuitous or onerous, i.e. with stipulated interest. In commodatum, borrower must return the same thing loaned, while in mutuum, borrower need only pay an equal amount of the same kind and quality. Commodatum is a loan for permissive or temporary use, while mutuum is a loan for consumption. In commodatum, the bailor may demand the return of the thing loaned before the expiration of the term in case of urgent need. Bailor suffers the loss of the subject since he is the owner. In mutuum, the lender may not demand its return before the lapse of the term agreed upon. Borrower suffers the loss even if caused exclusively by a fortuitous event, and he is not discharged from his duty to pay. Commodatum is purely personal in character while mutuum is not. Q23: WHO BEARS THE ORDINARY EXPENSES AND EXTRAORDINARY EXPENSES IN A COMMODATUM? A23: The bailee is obliged to pay for the ordinary expenses for the use and preservation of the thing loaned. [Art. 1941] The bailor shall refund the extraordinary expenses during the contract for the preservation of the thing loaned, provided that the bailee brings the same to the knowledge of the bailor before incurring them, except when they are so urgent that the reply to the notification cannot be awaited without danger. If the extraordinary expenses arise on the occasion of the actual use of the thing by the bailee, even though he acted without fault, they shall be borne equally by both the bailor and the bailee, unless there is a stipulation to the contrary. [Art. 1949] Q24: WHAT ARE THE RULES FOR AWARD OF INTEREST IN THE CONCEPT OF ACTUAL AND COMPENSATORY DAMAGES? A24: (1) When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 6% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Art. 1169 of the Civil Code. (2) When an obligation, not constituting a loan or forbearance of money, is breached, an interest on the amount of damages awarded may be imposed at the discretion of the court at the rate of 6% per annum. No interest, however, shall be adjudged on unliquidated claims or damages, except when or until the demand can be established with reasonable certainty. Accordingly, where the demand is established with reasonable certainty, the interest shall begin to run from the time the claim is made judicially or extrajudicially [Art. 1169], but when such certainty cannot be so reasonably established at the time the demand is made, the interest shall begin to run only from the date the judgment of the court is made (at which time the quantification of damages may be deemed to have been reasonably ascertained). The actual base for the computation of legal interest shall, in any case, be on the amount finally adjudged. (3) When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, whether the case falls under paragraph 1 or paragraph 2, above, shall be 6% per annum from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit. [Nacar v. Gallery Frames, G.R. No. 189871, August 13, 2013, modifying Eastern Page 10 of 40

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Shipping Lines vs. CA, G.R. No. 97412, July 12, 1994, in light of BSP-MB Circular No. 799] Q25: X ENTERED INTO A CONTRACT WITH Y FOR THE CONSTRUCTION OF A BUILDING TO BE FINISHED AT A STIPULATED TIME. THUS, Y HAD CERTAIN CONSTRUCTION MATERIALS DEPOSITED IN THE WAREHOUSE OWNED BY C. THE BUILDING WAS NOT FINISHED AT THE STIPULATED TIME SO X SUED Y FOR BREACH OF CONTRACT. IN THE MEANTIME, X DEMANDED FROM C THE RETURN OF THE MATERIALS DEPOSITED BY Y, BUT C CANNOT PRODUCE THE SAID MATERIALS FOR Y ALREADY WITHDREW THEM AT AN EARLIER TIME. X NOW COMMENCES AN ACTION AGAINST C FOR BREACH OF CONTRACT OF DEPOSIT. WILL IT PROSPER? EXPLAIN. A25: No. In order for C to be held liable for breach of contract of deposit, X must prove (1) the existence of any contract of deposit between him and C, or between C and some other person in X’s favor, and (2) that the objects which are the subject of the deposit is in C’s possession at the time of demand to return the same. In this case, he failed to prove the existence of any contract of deposit. If at all, it was only between C and Y. And even if there was indeed a contract of deposit between C and Y, X has to prove its existence and that it was executed in his favor, which he failed to do. He also failed to prove that there were construction materials and equipment in C’s warehouse at the time he made a demand for their return. [Chan v. Maceda, Jr., G.R. No. 142591, April 25, 2003] Q26: WHAT IS THE NATURE OF BANK DEPOSITS? A26: Fixed, savings, and current deposits of money in banks and similar institutions shall be governed by the provisions concerning simple loan. [Art. 1980] Bank deposits are in the nature of irregular deposits; they are really loans because they earn interest. The relationship then between a depositor and a bank is one of creditor and debtor. [Serrano v. Central Bank of the Phil., G.R. No. L-30511, February 14, 1980] The general rule is that a bank can compensate or set off the deposit in its hands for the payment of the indebtedness to it on the part of the depositor. [Gullas v. PNB, G.R. No. L-43191, November 13, 1935] Q27: WHAT IS THE NATURE OF A CONTRACT FOR THE RENT OF A SAFETY DEPOSIT BOX WITH A BANK? A27: It is a special kind of deposit. It cannot be characterized as an ordinary contract of lease because the full and absolute possession and control of the safety deposit box was not given to the renters. The guard key of the box remained with the bank; without this key, the renters could not open the box. On the other hand, the bank could not likewise open the box without the renter's key. [CA Agro-Industrial Development Corp. v. CA, G.R. No. 90027, March 3, 1993] Q28: DISTINGUISH THE RIGHT OF A DEPOSITARY UNDER THE CIVIL CODE AND THAT OF A WAREHOUSEMAN UNDER THE WAREHOUSE RECEIPTS LAW (ACT NO. 2137) AS REGARDS THE COMMINGLING OF GOODS. A28: Under Art. 1976 of the Civil Code, as a general rule, a depositary may commingle grain or other articles of the same kind and quality, unless there is a stipulation to the contrary. As for a warehouseman, under Sec. 22 of the Warehouse Receipts Law, a warehouseman shall keep the goods so far separate from goods of other depositors and from other goods of the same depositor for which a separate receipt has been issued, as to permit at all times the identification and redelivery of the goods deposited. The exception, found in Sec. 23, is, if authorized by agreement or by custom, the warehouseman may mingle fungible goods with other goods of the same kind and grade.

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Q29: DIFFERENTIATE BETWEEN GUARANTOR AND SURETY. A29: A guarantor is subsidiarily liable while a surety is primarily liable. A guarantor must pay if the principal debtor cannot (benefit of excussion) while a surety must pay if the principal debtor does not. A guarantor is an insurer of the principal debtor’s solvency, while a surety is an insurer of the debt. [Art. 2047] Q30: WHAT IS THE BENEFIT OF EXCUSSION AND HOW IS IT EXERCISED? A30: Under the benefit of excussion, the guarantor cannot be compelled to pay the creditor unless the latter has: (1) exhausted all of the property of the debtor; and (2) resorted to all the legal remedies against the debtor. [Art. 2058] In order that the guarantor may make use of the benefit of excussion, he must: (a) set it up against the creditor upon the latter’s demand for payment from him; and (b) point out to the creditor available property of the debtor within the Philippine territory and sufficient to cover the amount of the debt. [Art. 2060] Q31: WHAT ARE THE REQUISITES OF PLEDGE? A31: (1) Constituted to secure a principal obligation; (2) pledgor must be the absolute owner; (3) pledgor must have free disposal of the thing pledged; (4) when the principal obligations becomes due, the thing pledged may be alienated to satisfy payment of such obligation; (5) the subject matter of the contract must be a movable property; and (6) the thing pledged must be placed in the possession of the pledgee. Q32: WHAT ARE THE REQUISITES OF REAL ESTATE MORTGAGE? A32: (1) Constituted to secure fulfillment of an obligation in a manner prescribed by law; (2) mortgagor must be the absolute owner of property mortgaged; (3) mortgagor must have free disposal of the property mortgaged, or legally authorized to do so; (4) when the principal obligation becomes due, the property mortgaged may be alienated to satisfy payment of such obligation; and (5) the subject matter of the contract must be an immovable property or an alienable real right upon immovable property. Q33: WHAT IS PACTUM COMMISSORIUM? A33: Pactum commissorium is a stipulation that allows the creditor to appropriate the collateral, or dispose of it, in contravention of the provisions on foreclosure. Hence, it is considered null and void. It has two elements: (1) there is property pledged/mortgaged by way of security for the payment of the principal obligation; and (2) there is a stipulation for automatic appropriation by the creditor of the thing mortgaged/pledged in case of non-payment of the principal obligation within the stipulated period. Q34: IS REGISTRATION IN THE REGISTRY OF PROPERTY NECESSARY FOR THE VALIDITY OF A CONTRACT OF REAL ESTATE MORTGAGE? A34: No. However, it is necessary for the purpose of binding third persons. Consequently, whether registered or not, the contract is binding upon the parties [Samanilla v. Cajucom, G.R. No. L-13683, March 28, 1960]. This is clear from Art. 2126 of the Civil Code which declares that “in addition to the requisites stated in Art. 2085, it is indispensable, in order that a mortgage may be validly constituted, that the document in which it appears be recorded in the Registry of Property. If the instrument is not recorded, the mortgage is nevertheless binding between the parties. x x x”

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Q35: DISTINGUISH BETWEEN EQUITY OF REDEMPTION AND RIGHT OF REDEMPTION. A35: Equity of redemption refers to the right of the mortgagor in case of a judicial foreclosure to redeem the mortgaged property after his default in the performance of the conditions of the mortgage but before confirmation of the sale of the mortgaged property. The period for equity of redemption is 90120 days after entry of judgment requiring the debtor to pay. [Rules of Court, Sec. 2, Rule 68] On the other hand, right of redemption refers to the right of the mortgagor in case of extrajudicial foreclosure to redeem the mortgaged property within a certain period from and after it was sold for the satisfaction of the mortgage debt. The period for its exercise is within twelve (12) months from the time of the registration of the sale in the Office of the Register of Deeds [Sec. 6, Act. No. 3135]. An exception is found in Sec. 47 of the General Banking Law, which provides that notwithstanding Act 3135, juridical persons whose property is being sold pursuant to an extrajudicial foreclosure, shall have the right to redeem the property in accordance with this provision until, but not after, the registration of the certificate of foreclosure sale with the applicable Register of Deeds which in no case shall be more than three (3) months after foreclosure, whichever is earlier [Goldenway Merchandising Corp. v. Equitable PCI Bank, G.R. No. 195540, March 13, 2013]. Q36: WHAT IS THE OBJECT OF A CONTRACT OF CHATTEL MORTGAGE? A36: Chattel mortgage covers only movable property. However, parties may treat as movable that which by its nature is an immovable property but such contract of chattel mortgage is binding only between them and not to third persons. [Evangelista v. Alto Surety Inc., G.R. No. L-11139, April 23, 1958] Q37: WHERE IS A CHATTEL MORTGAGE RECORDED? A37: The mortgage is recorded in the office of the register of deeds of the province in which the mortgagor resides at the time of making the same, or, if he resides without the Philippine Islands, in the province in which the property is situated. If the property is situated in a different province from that in which the mortgagor resides, the mortgage shall be recorded in the office of the register of deeds of both the province in which the mortgagor resides and that in which the property is situated, and for the purposes of this Act, the city of Manila shall be deemed to be a province. [Sec. 4, Act No. 1508] Q38: WHAT IS ANTICHRESIS? A38: By the contract of antichresis, the creditor acquires the right to receive the fruits of an immovable of his debtor, with the obligation to apply them to the payment of the interest, if owing, and thereafter to the principal of his credit. [Art. 2132] Q39: IS THERE A SPECIFIC FORM REQUIRED FOR A CONTRACT OF ANTICHRESIS TO BE VALID? A39: Yes. The amount of the principal and of the interest shall be specified in writing; otherwise, the contract of antichresis shall be void. [Art. 2134] Q40: C BOUGHT CERTAIN SHARES OF STOCK FROM PF CORP. THE SHARES OF STOCK WERE DELIVERED TO CUSTODIAN BANKS WHO HELD SUCH ON C’S BEHALF. WHEN PF CORP. WAS PLACED UNDER RECEIVERSHIP BY THE SEC, THE RECEIVER WITHDREW THE SHARES FROM THE CUSTODIAN BANKS AND WERE SOLD WITHOUT HIS KNOWLEDGE AND WITHOUT AUTHORITY FROM THE SEC. THE PROCEEDS WERE COMMINGLED WITH PF CORP.’S OTHER ASSETS. UPON LEARNING OF THIS, HE Page 13 of 40

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FILED A CLAIM FOR PAYMENT OF THE VALUE OF THE STOCKS IN THE RECEIVERSHIP PROCEEDINGS. A 15% RATE OF RECOVERY WAS APPROVED FOR PF CORP.’S CREDITORS AND INVESTORS. C CLAIMS THAT HE IS ENTITLED TO THE ENTIRE MONETARY VALUE OF THE SHARES OF STOCK, ARGUING THAT HE IS A PREFERRED CREDITOR UNDER ART. 2241 (2) OF THE CIVIL CODE SINCE HIS CLAIM FOR THE MONETARY VALUE OF THE SHARES AROSE FROM THE UNAUTHORIZED SALE OF SUCH HIS STOCKS. IS C CORRECT? EXPLAIN. A40: No. Under Art. 2241 (2), claims arising from misappropriation, breach of trust, or malfeasance by public officials committed in the performance of their duties, on the movables, money or securities obtained by them, are preferred with reference to specific movable property of the debtor. While C’s shares were specific movable property, the money raised from them after their sale is a generic thing. C’s claim is for the payment of the monetary value of the shares, thus it does not fall under Art. 2241 (2). At most, C is deemed an ordinary creditor whose credit, along with other ordinary credits, shall be paid pro rata [Art. 2251(2)]. [Cordova v. Reyes Daway Lim Bernardo Lindo Rosales Law Offices, G.R. No. 146555, July 3, 2007]. Q41: WHAT IS THE DIFFERENCE BETWEEN MORTGAGE CREDITS AND UNPAID VENDOR’S LIENS WITH RESPECT TO PREFERRED CREDITS WITH REFERENCE TO THE DEBTOR’S SPECIFIC IMMOVABLE PROPERTY AND REAL RIGHTS? A41: While Art. 2242 specifically requires mortgage credits to be recorded in the Registry of Property in order to be given preference, no such requirement is made with respect to the vendor's lien for the unpaid price of real property sold. The law does not make any distinction between a registered and unregistered vendor's lien. Any lien of that kind enjoys the preferred credit status. [De Barretto v. Villanueva, G.R. No. L-14938, January 28, 1961] Q42: EXPLAIN THE ORDER OF PREFERENCE AND CONCURRENCE OF CREDITS PROVIDED IN THE CIVIL CODE. A42: The Civil Code establishes a two-tier order of preference among the enumerated special preferred credits: taxes come first, and all other claims come after. Only taxes, duties, and fees due on the movable or immovable properties enjoy preference among the special preferred credits in Arts. 2241 and 2242. All other claims in the said articles are not preferred over any other, as there is only a concurrence of credits among them.

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LAND TITLES AND DEEDS Q43: PEDRO AND HIS PREDECESSORS-IN-INTEREST HAVE BEEN IN OPEN, CONTINUOUS, EXCLUSIVE AND NOTORIOUS POSSESSION AND OCCUPATION OF A PARCEL OF LAND SINCE 1942. THE LAND APPLIED FOR WAS DECLARED ALIENABLE AND DISPOSABLE ON OCTOBER 15, 1980. IN 1993, PEDRO FILED A PETITION FOR REGISTRATION OF TITLE OF THE SAID PARCEL OF LAND. THE REPUBLIC OPPOSED ON THE GROUND THAT THE LAND MUST HAVE BEEN DECLARED ALIENABLE AND DISPOSABLE SINCE JUNE 12, 1945 PURSUANT TO SECTION 14(1) OF PD 1529. IS THE REPUBLIC CORRECT? EXPLAIN. A43: No. The Supreme Court, in the case of Republic v. CA and Naguit, G.R. No. 144057, January 17, 2005, held that Section 14(1) merely requires the property sought to be registered as already alienable and disposable at the time the application for registration of title is filed. This was reiterated in Malabanan v. Republic, G.R. No. 179987, September 3, 2013. Q44: IN 1978, X AND Y, FILIPINO CITIZENS, BOUGHT A PARCEL OF LAND FROM C, WHO HAS COMPLIED WITH THE REQUIREMENTS FOR REGISTRATION UNDER THE PUBLIC LAND ACT. A YEAR AFTER THE SALE, A AND B WENT ABROAD AND SUBSEQUENTLY ACQUIRED CANADIAN CITIZENSHIP. WHEN THEY RETURNED TO THE PHILIPPINES, THEY FILED AN APPLICATION FOR THE REGISTRATION OF SAID LOTS. THE GOVERNMENT OPPOSED THEIR APPLICATION ON THE GROUND THAT THEY ARE ALIENS. THE TRIAL COURT ALLOWED THE REGISTRATION. IS THE TRIAL COURT CORRECT? EXPLAIN. A44: Yes. The Supreme Court held in the case of Republic v. CA and Lapiña, G.R. No. 108998, August 24, 1994, that even if X and Y were already Canadian citizens at the time they sought registration, what is important is at the time they bought the land, the land was already private land. Hence, they already acquired a vested right, consisting of an imperfect title, over the property, before they lost their Philippine citizenship. Q45: JUAN IS THE REGISTERED OWNER OF A PARCEL OF LAND. THE NORTHEASTERN BOUNDARY WAS A RIVER. FOR MANY YEARS, A GRADUAL ACCRETION TOOK PLACE BY ACTION OF THE CURRENT OF THE SAID RIVER, SO MUCH SO THAT AN ALLUVIAL DEPOSIT OF AROUND 20,000 SQUARE METERS HAD BEEN ADDED TO THE REGISTERED AREA. IN THE MEANTIME, JOSE ENTERED UPON THE PORTION OF LAND FORMED BY ACCRETION UNDER CLAIM OF OWNERSHIP. JUAN FILED AN ACTION AGAINST JOSE TO QUIET TITLE TO SAID PORTION, ALLEGING THAT HE AND HIS PREDECESSORS-IN-INTEREST WERE FORMERLY IN PEACEFUL AND CONTINUOUS POSSESSION THEREOF, UNTIL THE TIME WHEN JOSE ENTERED THE LAND. WILL JUAN’S ACTION PROSPER? EXPLAIN. A45: No. The Supreme Court held in the case of Grande v. CA, G.R. No. L-17652, June 30, 1962, that accretion does not automatically become registered land just because the lot which receives such accretion is covered by a Torrens title. Therefore, the increment never became registered property, and hence is not entitled to the protection enjoyed by registered property. Consequently, it was subject to acquisition through prescription by third persons. Q46: MARIO APPLIED FOR REGISTRATION OF A PARCEL OF LAND CONTAINING 1,000 SQUARE METERS. DURING THE PENDENCY OF THE CASE, HE BOUGHT THE ADJOINING PORTION OF 200 SQUARE METERS. CAN THE ADDITIONAL PORTION BE INCLUDED IN THE ORIGINAL APPLICATION?

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A46: Yes, by amendment of the original application pursuant to Sec. 19, PD 1529 (Property Registration Decree). However, amendments which consist in the inclusion of additional land shall be subject to the same requirements of publication and notice as in an original application. Q47: THE GOVERNMENT ATTEMPTED TO SELL THE ROPPONGI PROPERTY IN TOKYO, WHICH WAS ACQUIRED BY THE PHILIPPINE GOVERNMENT FOR USE AS THE CHANCERY OF THE PHILIPPINE EMBASSY. THIS WAS AFTER THE CHANCERY TRANSFERRED TO ANOTHER LOCATION. CAN THE GOVERNMENT VALIDLY SELL THE ROPPONGI PROPERTY SINCE IT IS NOT BEING USED ANYMORE? EXPLAIN. A47: No. In Laurel v Garcia, G.R. No. 92013, July 25, 1990, the Court ruled that property of public domain retains such character until formally declared otherwise. The Roppongi property is a property for public service, therefore, it is outside the commerce of man. The fact that the Roppongi property has not been used for a long time for actual Embassy service does not automatically convert it to patrimonial property. Q48: PEDRO AND MARIA FILED A COMPLAINT AGAINST JOSE FOR QUIETING OF TITLE AND DAMAGES. IN HIS ANSWER, JOSE AVERRED, BY WAY OF AFFIRMATIVE DEFENSE, THAT THE LOT IN QUESTION WAS A PORTION OF A PARCEL OF LAND SOLD TO HIM BY A CERTAIN JUAN. HE INTERPOSED A COUNTERCLAIM THAT GREGORIO, PEDRO AND MARIA’S PREDECESSOR, OBTAINED HIS TITLE THROUGH FRAUD. PEDRO AND MARIA COUNTERED THAT JOSE’S COUNTERCLAIM CONSTITUTED A COLLATERAL ATTACK ON THE TITLE OF GREGORIO. ARE THEY CORRECT? EXPLAIN. A48: No. The Supreme Court in Leyson v. Bontuyan held that an action is a direct attack on a title if its object is to nullify the same, and thus challenge the proceeding pursuant to which the title was issued. A direct attack on a title may be in an original action or in a counterclaim assailing it as void. Q49: THE MUNICIPALITY OF CABANATUAN EXPROPRIATED THE LAND OF MARIA FOR THE PURPOSE OF A PUBLIC MARKET SITE. THE COURT GRANTED THE EXPROPRIATION WITHOUT CONDITION. SUBSEQUENTLY, MARIA FILED AN ACTION SEEKING THE RETURN OF THE LAND TO HER ALLEGING THAT THE MUNICIPALITY HAS ABANDONED THAT PURPOSE AND THEREBY LOST ITS RIGHT TO THE PARCEL OF LAND SO EXPROPRIATED. IS THE ACTION LEGALLY VIABLE? A49: No. The municipality had acquired a fee simple title to the land in question, without any condition. When the land has been acquired for public use in fee simple, unconditionally, either by the exercise of eminent domain or by purchase, the former owner retains no rights in the land, and the public use may be abandoned, or the land may be devoted to a different use, without any impairment of the estate or title acquired, or any reversion to the former owner. [Fery v. Municipality of Cabanatuan, G.R. No. 17540, July 23, 1921] Q50: F AND G WERE OWNERS OF A PARCEL OF LAND COVERED BY A TCT. THEY ALLOWED THEIR FIRST COUSIN, N, TO USE THE LAND, BUT ARE NOW DEMANDING THAT THE COUSIN VACATE IT. N CLAIMS POSSESSORY RIGHTS BECAUSE HE AND HIS PREDECESSORS-IN-INTEREST HAVE BEEN CONTINUOUSLY, PUBLICLY AND ADVERSELY POSSESSING THE LAND FOR MORE THAN 59 YEARS AFTER HIS FATHER RECEIVED THE LAND BY A DONATION PROPTER NUPTIAS FROM THE ORIGINAL OWNER, HIS GRANDFATHER, E. ON THE OTHER HAND, F AND G CLAIM THAT THEIR PARENTS PURCHASED THE PROPERTY FROM THE GRANDFATHER, E, IN 1941 AND HAD THE LAND REGISTERED UNDER A TCT AND THEY SUBSEQUENTLY INHERITED THE SAME. WHEN THEIR PARENTS DIED, THEY HAD THE LAND REGISTERED IN THEIR NAMES BEFORE ALLOWING N FREE USE OF THE LAND. WHO HAS RIGHTFUL POSSESSION OF THE PARCEL OF LAND? Page 16 of 40

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A50: F and G are entitled to possess the land. It is a fundamental principle in land registered under the Torrens system that a certificate of title serves as evidence of an indefeasible and incontrovertible title to the property in favor of the person whose name appears therein. The certificate becomes the best proof of ownership of a parcel of land; hence, anyone who deals with property registered under the Torrens system may rely on the title and need not go beyond it (doctrine of indefeasibility of title). F and G have the preferential right because they hold a Torrens title in their name and may enjoy possession of the thing to the exclusion of any other person. N’s manner of attacking the title was a collateral one, which is prohibited under Sec. 48 of PD 1529. [Abobon v. Abobon, G.R. No. 155830, August 15, 2012; J. Bersamin] Q51: L BROUGHT A PETITION FOR CANCELLATION OF OCT OF A PARCEL OF LAND (APPROXIMATELY 14,310 HA) BEFORE THE LRC, IMPLEADING THE REPUBLIC, FDC AND FAI. THE LAND WAS THE SUBJECT OF AN OCT ISSUED IN THE NAME OF THE REPUBLIC, AND A PORTION OF IT WAS SEGREGATED, FOR WHICH A TCT WAS ISSUED AND SUBSEQUENTLY TRANSFERRED TO FDC AND FAI. WHEN A MTD WAS FILED, ALLEGING FAILURE TO COMPLY WITH REQUISITES OF AN INITIATORY PLEADING, L CLAIMED THAT THE PETITION FOR CANCELLATION WAS NOT AN INITIATORY PLEADING BUT A MERE INCIDENT OF A PAST REGISTRATION PROCEEDING (WON BY THE REPUBLIC). WAS THE ACTION PROPER? A51: No. Under Sec. 108 of PD 1529, there are seven specific grounds1 for the alteration, amendment, or cancellation of a title and the instant case is not one of them. L is clearly seeking reconveyance of the property, not cancellation of a certificate, which is not permissible considering that the one-year period to reopen a decree of registration had lapsed. The OCT had already been subdivided into smaller lots which had passed onto third persons, making this petition violative of the proviso in Sec. 108. L’s claim that the petition was a mere continuation is incorrect as what he seeks is a distinct and independent action for reconveyance; he must comply with the requisites of an action for reconveyance in order that it may prosper. [Paz v. Republic, G.R. No. 157367, November 23, 2011; J. Bersamin] Q52: A VACANT LAND IN WHITE PLAINS WAS COVERED BY A TCT IN THE NAME OF D, WHO LATER LEARNED THAT CONSTRUCTION ACTIVITIES WERE BEING UNDERTAKEN ON HER PROPERTY WITHOUT HER CONSENT. UPON INVESTIGATION, SHE FOUND OUT THAT S REPRESENTED HERSELF AS THE OWNER OF THE PROPERTY AND PETITIONED THE RTC FOR THE ISSUANCE OF A NEW OWNER’S COPY OF THE TCT, APPENDING A DEED OF ABSOLUTE SALE ALLEGEDLY EXECUTED BY D (JULY 14, 1997) AND AN AFFIDAVIT OF LOSS (JULY 17, 1997). A NEW TCT WAS ISSUED IN S’S FAVOR (AUGUST 26, 1997), AND SHE SUBDIVIDED THE PROPERTY AND SOLD IT TO SPS DV AND SPS C. THE 2 SETS OF SPOUSES PAID P1-M EACH FOR THE ENTIRE PROPERTY WHICH WAS VALUED AT NOT LESS THAN P14-M. D FILED AN ACTION AGAINST ALL OF THEM. WHO HAS RIGHTFUL OWNERSHIP OF THE PROPERTY, D OR THE SPS. WHO ARE THIRD PARTY BUYERS? A52: D is the lawful owner. The 2 sps. cannot be considered purchasers in good faith and for value by claiming that S’s TCT was free from liens or encumbrances that could have made them suspicious. Under the Torrens system, there is the curtain principle, in that one does not need to go behind the certificate of title because it contains all the information about the title of its holder. This dispenses with the need of proving ownership by long complicated documents kept by the registered owner. The sps. may have purchased it in good faith as they failed to find any encumbrance annotated, but their observance of diligence must one in good faith and for value. It was insufficient that they checked if the 1

(a) when registered interests of any description, whether vested, contingent, expectant, or inchoate, have terminated and ceased; (b) when new interests have arisen or been created which do not appear upon the certificate; (c) when any error, omission or mistake was made in entering a certificate or any memorandum thereon or on any duplicate certificate; (d) when the name of any person on the certificate has been changed; (e) when the registered owner has been married, or, registered as married, the marriage has been terminated and no right or interest of heirs or creditors will thereby be affected; (f) when a corporation, which owned registered land and has been dissolved, has not conveyed the same within three years after its dissolution; and (g) when there is reasonable ground for the amendment or alteration of title.

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property was unfenced and vacant or that the TCT was not annotated. They were aware that S’s TCT was derived from a duplicate owner’s copy reissued due to the loss of the original duplicate owner’s copy. This should have alerted them to inquire beyond the face of S’s TCT. In addition, the transactions affecting the property took place in a short span of time and the property was grossly undervalued. As in Garcia v. CA, the reissuance of duplicate owner’s copy is considered as merely a reconstituted certificate of title. It is a mere subsequent copy of the original, and are not the originals themselves, so anyone dealing with them must be extra-careful. Since the sps. were aware, they oculd not be innocent purchasers for value. [Sps. Cusi v. Domingo, G.R. No. 195871, February 27, 2013; J. Bersamin] Q53: P WAS A NATURAL-BORN CITIZEN WHO SUBSEQUENTLY LOST HIS PHILIPPINE CITIZENSHIP. ASSUMING THAT P IS OF AGE, CAN LAND BE LAWFULLY TRANSFERRED TO P? IF SO, WHAT ARE THE LIMITATIONS? A53: Under Sec. 5 of BP 185, land may be transferred to P via voluntary sale, devise or donation, or involuntary sales on tax delinquency, foreclosure and execution of judgment. Additional documentary requirements must be complied with under Sec. 6. In addition, the land that may be transferred must only be a private land, up to a maximum of 5,000 sqm. (urban land) or 3 ha (rural land) for business or other purposes (Secs. 2 and 3 of BP 185, as amended by Sec. 10 of RA 7042, pursuant to Sec. 5 of RA 8179). If P is married, either he or his wife may avail of the privilege, but the total cannot exceed the maximum.

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OBLIGATIONS AND CONTRACTS Q54: X ASKED Y IF HE CAN OBTAIN A LOAN FOR P1 MILLION FROM THE LATTER. Y AGREED, PROVIDED HE ALONE WILL DECIDE THE EXACT DATE WHEN HE WILL GIVE THE MONEY TO X BEFORE THE YEAR ENDS. WHAT IS THE EFFECT OF SUCH OBLIGATION WITH A POTESTATIVE CONDITION? A54: The obligation is valid because it is depends upon the will of the creditor. (1) If the fulfillment of the potestative condition depends exclusively upon the will of the debtor, the conditional obligation is VOID. (2) If the fulfillment depends upon the exclusive will of the creditor, the conditional obligation is VALID. (3) If the obligation depends upon chance or upon the will of a third person, it is VALID. [Art. 1182] Q55: A, B, C, AND D AGREED THAT THEY WILL OBTAIN A LOAN OF P1 MILLION. THEY AGREED THAT THE LOAN WILL BE DISTRIBUTED AND PAID USING THE FOLLOWING RATIO - 40:40:10:10, RESPECTIVELY. THE NEXT DAY, THEY EXECUTED A PROMISSORY NOTE WHICH STATES: “WE PROMISE TO PAY X P1 MILLION AT THE END OF THE YEAR, SIGNED BY A, B, C, AND D.” HOW MUCH CAN X COLLECT FROM EACH OF THE DEBTORS COME DUE DATE? A55: P250,000 each. The general rule is that an obligation is presumed to be joint if there is concurrence of two or more debtors in the same obligation except if otherwise provided by (a) stipulation, (b) law, or (c) the nature of the obligation. The debt shall be presumed to be divided into as many equal shares as there are debtors. Here, the promissory note did not mention the ratio of payment and none of the exceptions are present, thus the general rule on joint liability applies. This is without prejudice as to the enforcement among the debtors themselves of the settlement ratio in accordance with their agreement. [Art. 1207 – 1208] Q56: X WAS WALKING AT THE SIDE OF THE ROAD WHEN AN ONCOMING CAR DRIVEN BY Y SUDDENLY HIT X WHICH CAUSED THE LATTER SEVERE INJURIES. Y RAISED THE DEFENSE OF FORTUITOUS EVENT DUE TO TIRE BLOW-OUT. WILL THE DEFENSE OF Y PROSPER? A56: No. As a general rule, no person shall be responsible for those events which could not be foreseen, or which foreseen, were inevitable. The exceptions are (1) when expressly specified by law, (2) when expressly stipulated in the contract, and (3) when the nature of the obligation requires the assumption of risk. However, jurisprudence expressly provides that defective brakes, tire blow-outs and others of similar nature cannot be classified as fortuitous events per se within the meaning of the law. (Tugade v. CA, 85 SCRA 226, July 31, 2003; La Mallorca v. De Jesus, 17 SCRA 23, May 14, 1966) Q57: X OPENED A SAVINGS ACCOUNT WITH BANK Y AND DEPOSITED P500,000. SUBSEQUENTLY, X, AS AN ACCOMMODATION TO HIS FRIEND Z, OBTAINED A LOAN FROM BANK Y IN HIS NAME FOR 100,0000 PAYABLE AFTER 6 MONTHS. ON DUE DATE, BANK Y DEMANDED PAYMENT FROM X BUT HE REFUSED TO PAY. CAN BANK Y DEBIT THE ACCOUNT OF X TO SATISFY THE DEBT? A57: Yes, by virtue of legal compensation. All the requisites of a valid compensation are present here, namely (1) there are two parties who, in their own right, are principal creditors and debtors of each other, (2) both debts consist in money, (3) both debts are due, (4) both debts are liquidated and demandable, (5) there is no retention or controversy commenced by third persons, (6) compensation is not prohibited by law. Moreover, as a general rule, a bank has a right to set off the deposits in its hands for the payment of any indebtedness to it on the part of a depositor. [Gullas v. PNB, 62 Phil 519, November 13, 1935] The accommodation is of no moment because the debt was obtained in X’s own name.

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Q58: WHAT ARE THE TWO FORMS OF SUBSTITUTION OF DEBTORS IN NOVATION? A58: Expromision and Delegacion. Expromision is effected with the consent of the creditor at the instance of the new debtor even without the consent or against the will of the old debtor, while Delegacion is effected with the consent of the creditor at the instance of the old debtor with the consent of the new debtor. Q59: GSIS AND SPS. LEUTERIO EXECUTED A CONDITIONAL DEED OF SALE OF A HOUSE AND LOT FOR P2 MILLION. WHEN THE CONSTRUCTION WAS FINISHED, GSIS FOUND THAT THE CONSTRUCTION COST WAS HIGHER THAN THEY PREVIOUSLY ESTIMATED. GSIS INSERTED A CLAUSE IN THE DEED OF SALE “SUBJECT TO ADJUSTMENT PENDING APPROVAL OF THE BOARD.” SUBSEQUENTLY, GSIS INFORMED THE SPS. THAT THE BOARD APPROVED THE PRICE OF P2.5 MILLION. CAN GSIS INCREASE THE PRICE AS APPROVED BY THE BOARD? A59: No, the unilateral subsequent increase in price by GSIS is not valid as it is in violation of the general principles of contracts, particularly the mutuality and obligatory force of contracts. (On Mutuality) Art 1308 provides that contracts must bind both contracting parties and its validity or compliance cannot be left to the will of one of them. Art 1473 likewise provides that the fixing of the price can never be left to the discretion of one of the contracting parties. Here, the Sps. did not consent to the new unilateral price, thus invalid. Any change in the contract must be mutually agreed upon, otherwise it is bereft of any binding effect. (On Obligatory Force) The law on contracts does not excuse a party from specific performance just because of bad business judgments in estimating the production cost and selling price. GSIS is bound by the selling price set in the conditional deed of sale as initially agreed upon. Q60: X WAS LOOKING FOR A LOT WHERE HE CAN BUILD HIS WAREHOUSE. ON NOVEMBER 5, Y OFFERED TO SELL HIS LOT TO X FOR P5 MILLION. Y TOLD X TO THINK ABOUT THE OFFER FOR 1 MONTH AND PROMISED THAT HE WILL NOT SELL THE LOT TO ANOTHER DURING THE SAID PERIOD. ON NOVEMBER 20, X SENT A LETTER TO Y STATING THAT HE WILL BUY THE LOT AS OFFERED. ON NOVEMBER 21, Y SOLD THE LOT TO Z FOR P6 MILLION AND INFORMED X THEREOF. Y RECEIVED X’S LETTER ON NOVEMBER 29. IS Y LIABLE TO X? A60: No, because the option contract was without consideration. An option is a contract granting a person the privilege to buy or not to buy something at any time within the agreed period at a fixed price. The contract of option is a separate and distinct contract. If the option is without consideration, the offeror may withdraw his offer by communicating such withdrawal to the offeree at any time before acceptance [Art 1324]. Here, the option contract was without consideration and was withdrawn before the acceptance which was on November 29 when the letter was received and made known to the offeror. Thus Y may validly withdraw the offer without liability. Q61: WHAT IS ESTOPPEL BY LACHES? A61: The doctrine of laches is based on public policy which requires that for the peace of society, the discouragement of stale claims, and unlike the Statute of Limitations, is not a mere question of time but is principally a question of the inequity or unfairness of permitting a right or claim to be enforced or asserted [Tijam v. Sibonghanoy, 23 SCRA 29, April 15, 1968]. Laches is the failure or neglect for an unreasonable length of time to do what, by exercising due diligence, could or should have done earlier. The four essential elements of laches are (1) conduct on the part of the Defendant giving rise to the situation of which the Complainant seeks a remedy, (2) delay in asserting Complainant’s rights having knowledge of Defendant’s conduct, (3) lack of knowledge on the part of the Defendant that the complainant will assert his right, (4) injury or prejudice to the Defendant if relief is accorded to the Complainant [Miguel v Catalino, 26 SCRA 234, November 29, 1968].

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Q62: DISTINGUISH NATURAL AND CIVIL OBLIGATIONS. A62: Civil Obligations are based on positive law while Natural Obligations are based on equity and natural law. Civil obligations give the obligee the legal right to compel the performance of the obligation by bringing an action in court while no such legal right exists in Natural Obligations except when the debtor voluntarily pays knowing that the debt is no longer due, wherein in such case, he cannot recover what he has paid. Q63: WHAT ARE THE TYPES OF CONTRACTS? A63: The following are the types of contract: (1) Valid Contracts [Art. 1318] Contracts established upon the concurrence of the following requisites: (1) Consent of the contracting parties, (2) Object certain which is the subject matter of the contract, (3) Cause of the obligation which is established. (2) Rescissible Contracts [Art. 1380] (1) Those which are entered into by guardians whenever the wards whom they represent suffer lesion by more than one-fourth of the value of the things which are the object thereof; (2) Those agreed upon in representation of absentees, if the latter suffer the lesion stated in the preceding number; 
 (3) Those undertaken in fraud of creditors when the latter cannot in any other manner collect the claims due them; 
 (4) Those which refer to things under litigation if they have been entered into by the defendant without the knowledge and approval of the litigants or of competent judicial authority; (5) All other contracts specially declared by law to be subject to rescission 
 (3) Voidable Contracts [Art. 1390, CC] (1) Those where one of the parties is incapable of giving consent to a contract; (2) Those where the consent is vitiated by mistake, violence, intimidation, undue influence or fraud. (4) Unenforceable Contracts [Art. 1403, CC] (1) Those entered into in the name of another person by one who has been given no authority or legal representation, or who has acted beyond his powers; 
 (2) Those that do not comply with the Statute of Frauds as set forth in this number. In the following cases an agreement hereafter made shall be unenforceable by action, unless the same, or some note or memorandum, thereof, be in writing, and subscribed by the party charged, or by his agent; evidence, therefore, of the agreement cannot be received without the writing, or a secondary evidence of its contents:

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a) An agreement that by its terms is not to be performed within a year from the making thereof; 
 b) A special promise to answer for the debt, default, or miscarriage of another; 
 c) An agreement made in consideration of marriage, other than a mutual promise to marry; 
 d) An agreement for the sale of goods, chattels or things in action, at a price not less than five hundred pesos, unless the buyer accept and receive part of such goods and chattels, or the evidences, or some of them, of such things in action or pay at the time some part of the purchase money; but when a sale is made by auction and entry is made by the auctioneer in his sales book, at the time of the sale, of the amount and kind of property sold, terms of sale, price, names of the purchasers and person on whose account the sale is made, it is a sufficient memorandum; e) An agreement for the leasing for a longer period than one year, or for the sale of real property or of an interest therein; 
 f)

A representation as to the credit of a third person. 


(3) Those where both parties are incapable of giving consent to a contract. (5) Void Contracts [Art. 1409, CC] (1) Those whose cause, object or purpose is contrary to law, morals, good customs, public order or public policy; (2) Those which are absolutely simulated or fictitious; (3) Those whose cause or object did not exist at the time of the transaction; (4) Those whose object is outside the commerce of men; (5) Those which contemplate an impossible service; (6) Those where the intention of the parties relative to the principal object of the contract cannot be ascertained; (7) Those expressly prohibited or declared void by law.

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PRIVATE INTERNATIONAL LAW Q64: MS. A, A FILIPINO NATIONAL, MARRIED MR. B, A SWEDISH NATIONAL. THEY HAD A SON C. THE COUPLE LATER OBTAINED A DIVORCE DECREE IN SWEDEN. MOTHER AND SON RETURNED TO LIVE IN THE PHILIPPINES. B ALSO WENT TO LIVE IN THE PHILIPPINES AND LATER REMARRIED. WHILE B HAD PROMISED TO PROVIDE SUPPORT FOR C, HE FAILED TO DO SO ONCE THE PARTIES WERE IN THE PHILIPPINES. A FILED A CASE FOR VIOLATION OF RA 9262 (VAWC). RTC DISMISSED THE CASE ON THE GROUND THAT THE INFORMATION DOES NOT CONSTITUTE AN OFFENSE SINCE THE ACCUSED IS AN ALIEN WHO IS NOT SUBJECT TO THE FAMILY CODE, WHICH PROVIDES FOR THE OBLIGATION TO PAY SUPPORT. IS THE RTC CORRECT? A64: Yes. Article 15 of the Civil Code stresses the nationality principle, providing that laws relating to family rights and duties are binding upon citizens of the Philippines even though living abroad. By analogy, the same principle applies to foreigners such that they are governed by their national law with respect to family rights and duties. Note: Courts cannot take judicial notice of foreign law. Hence, accused B must still plead and prove the provisions of his national law on support in order to show that he is not obliged to give support. Otherwise, due to the processual presumption, the court will presume that the foreign law is the same as our domestic law. [Del Socorro v. Van Wilsem, G.R. No. 193707, December 10, 2014] Q65: ALDEN AND STELA WERE BOTH FORMER FILIPINO CITIZENS. THEY WERE MARRIED IN THE PHILIPPINES BUT THEY LATER MIGRATED TO THE UNITED STATES WHERE THEY WERE NATURALIZED AS AMERICAN CITIZENS. IN THEIR UNION THEY WERE ABLE TO ACCUMULATE SEVERAL REAL PROPERTIES BOTH IN THE US AND IN THE PHILIPPINES. UNFORTUNATELY, THEY WERE NOT BLESSED WITH CHILDREN. IN THE US, THEY EXECUTED A JOINT WILL INSTITUTING AS THEIR COMMON HEIRS TO DIVIDE THEIR COMBINED ESTATE IN EQUAL SHARES, THE FIVE SIBLINGS OF ALDEN AND THE SEVEN SIBLINGS OF STELA. ALDEN PASSED AWAY IN 2013 AND A YEAR LATER, STELA ALSO DIED. THE SIBLINGS OF ALDEN WHO WERE ALL CITIZENS OF THE US INSTITUTED PROBATE PROCEEDINGS IN A US COURT IMPLEADING THE SIBLINGS OF STELA WHO WERE ALL IN THE PHILIPPINES. (A) WAS THE JOINT WILL EXECUTED BY ALDEN AND STELA WHO WERE BOTH FORMER FILIPINOS VALID? EXPLAIN WITH LEGAL BASIS. (B) CAN THE JOINT WILL PRODUCE LEGAL EFFECT IN THE PHILIPPINES WITH RESPECT TO THE PROPERTIES OF ALDEN AND STELA FOUND HERE? IF SO, HOW? (C) IS THE SITUATION PRESENTED AN EXAMPLE OF DEPECAGE? A65: (a) Yes, the joint will of Alden and Stela is considered valid. Being no longer Filipino citizens at the time they executed their joint will, the prohibition under our Civil Code on joint wills will no longer apply to Alden and Stela. For as long as their will was executed in accordance with the law of the place where they reside, or the law of the country of which they are citizens or even in accordance with the Civil Code, a will executed by an alien is considered valid in the Philippines. [Article 816, Civil Code] (b) Yes, the joint will of Alden and Stela can take effect even with respect to the properties located in the Philippines because what governs the distribution of their estate is no longer Philippine law but their national law at the time of their demise. Hence, the joint will produces legal effect even with respect to the properties situated in the Philippines. (c) No, because depecage is a process of applying rules of different states on the basis of the precise issue involved. It is a conflict of laws where different issues within a case may be governed by the laws of different states. In this situation, no conflict of laws will arise because Alden and Stela are no longer Filipino citizens at the time of the execution of their joint will and the place of execution is not the Philippines.

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Q66: FELIPE IS A FILIPINO CITIZEN. WHEN HE WENT TO SYDNEY FOR VACATION, HE MET A FORMER BUSINESS ASSOCIATE, WHO PROPOSED TO HIM A TRANSACTION WHICH TOOK HIM TO MOSCOW. FELIPE BROKERED A CONTRACT BETWEEN SYDNEY COALS CORP. (COALS), AN AUSTRALIAN FIRM, AND MOSCOW ENERGY CORP. (ENERGY), A RUSSIAN FIRM, FOR COALS TO SUPPLY COAL TO ENERGY ON A MONTHLY BASIS FOR THREE YEARS. BOTH THESE FIRMS WERE NOT DOING, AND STILL DO NOT DO, BUSINESS IN THE PHILIPPINES. FELIPE SHUTTLED BETWEEN SYDNEY AND MOSCOW TO CLOSE THE CONTRACT. HE ALSO EXECUTED IN SYDNEY A COMMISSION CONTRACT WITH COALS AND IN MOSCOW WITH ENERGY, UNDER WHICH CONTRACTS HE WAS GUARANTEED COMMISSIONS BY BOTH FIRMS BASED ON A PERCENTAGE OF DELIVERIES FOR THE THREE-YEAR PERIOD, PAYABLE IN SYDNEY AND IN MOSCOW, RESPECTIVELY, THROUGH DEPOSITS IN ACCOUNTS THAT HE OPENED IN THE TWO CITIES. BOTH FIRMS PAID FELIPE HIS COMMISSION FOR FOUR MONTHS, AFTER WHICH THEY STOPPED PAYING HIM. FELIPE LEARNED FROM HIS CONTACTS, WHO ARE RESIDENTS OF SYDNEY AND MOSCOW, THAT THE TWO FIRMS TALKED TO EACH OTHER AND DECIDED TO CUT HIM OFF. HE NOW FILES SUIT IN MANILA AGAINST BOTH COALS AND ENERGY FOR SPECIFIC PERFORMANCE. SHOULD THE PHILIPPINE COURT ASSUME JURISDICTION OVER THE CASE? EXPLAIN. A66: No, the Philippine courts cannot acquire jurisdiction over the case of Felipe. Firstly, under the rule of forum non conveniens, the Philippine court is not a convenient forum as all the incidents of the case occurred outside the Philippines. Neither are both Coals and Energy doing business inside the Philippines. Secondly, the contracts were not perfected in the Philippines. Under the principle of lex loci contractus, the law of the place where the contract is made shall apply. Lastly, the Philippine court has no power to determine the facts surrounding the execution of said contracts. And even if a proper decision could be reached, such would have no biding effect on Coals and Energy as the court was not able to acquire jurisdiction over the said corporations. [Manila Hotel Corp. v. NLRC, G.R. No. 120077, October 13, 2000] Q67: ABLE, A CORPORATION DOMICILED IN STATE A, BUT DOING BUSINESS IN THE PHILIPPINES, HIRED ERIC, A FILIPINO ENGINEER, FOR ITS PROJECT IN STATE B. IN THE CONTRACT OF EMPLOYMENT EXECUTED BY THE PARTIES IN STATE B, IT WAS STIPULATED THAT THE CONTRACT COULD BE TERMINATED AT THE COMPANY'S WILL, WHICH STIPULATION IS ALLOWED IN STATE B. WHEN ERIC WAS SUMMARILY DISMISSED BY ABLE, HE SUED ABLE FOR DAMAGES IN THE PHILIPPINES. WILL THE PHILIPPINE COURT APPLY THE CONTRACTUAL STIPULATION? A67: No, using the significant relationships theory, there are contacts significant to the Philippines. Among these are that the place of business is the Philippines, the employee concerned is a Filipino and the suit was filed in the Philippines, thereby justifying the application of Philippine law. Moreover, the Court held that when what is involved is paramount state interest, the court can disregard choice of forum and choice of law. [Zalamea v. CA, G.R. No. 104235, November 18, 1993]. The Philippine Constitution affords full protection to labor and the stipulation as to summary dismissal runs counter to our fundamental and statutory laws. [Cadalin v. POEA, G.R. No. 104776, December 5, 1994] Therefore, the Philippine Court should not apply the stipulation in question. Q68: X AND Y ENTERED INTO A CONTRACT IN AUSTRALIA, WHEREBY IT WAS AGREED THAT X WOULD BUILD A COMMERCIAL BUILDING FOR Y IN THE PHILIPPINES, AND IN PAYMENT FOR THE CONSTRUCTION, Y WILL TRANSFER AND CONVEY HIS CATTLE RANCH LOCATED IN THE UNITED STATES IN FAVOR OF X. WHAT LAW WOULD GOVERN: (A) THE VALIDITY OF THE CONTRACT?; (B) THE PERFORMANCE OF THE CONTRACT?; AND (C) THE CONSIDERATION OF THE CONTRACT? A68: (a) The validity of the contract will be governed by Australian law, because the validity refers to the element of the making of the contract in this case unless the parties agreed to be bound by

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another law. (b) The performance will be governed by the law of the Philippines where the contract is to be performed. (c) The consideration will be governed by the law of the United States where the ranch is located. In the foregoing cases, when the foreign law would apply, the absence of proof of that foreign law would render Philippine law applicable under processual presumption. Q69: FRANCIS ALBERT, A CITIZEN AND RESIDENT OF NEW JERSEY, U.S.A., UNDER WHOSE LAW HE WAS STILL A MINOR, BEING ONLY 20 YEARS OF AGE, WAS HIRED BY ABC CORPORATION OF MANILA TO SERVE FOR TWO YEARS AS ITS CHIEF COMPUTER PROGRAMMER. BUT AFTER SERVING FOR ONLY FOUR MONTHS, HE RESIGNED TO JOIN XYZ CORPORATION, WHICH ENTICED HIM BY OFFERING MORE ADVANTAGEOUS TERMS. HIS FIRST EMPLOYER SUES HIM IN MANILA FOR DAMAGES ARISING FROM THE BREACH OF HIS CONTRACT OF EMPLOYMENT. HE SETS UP HIS MINORITY AS A DEFENSE AND ASKS FOR ANNULMENT OF THE CONTRACT ON THAT GROUND. THE PLAINTIFF DISPUTES THIS BY ALLEGING THAT SINCE THE CONTRACT WAS EXECUTED IN THE PHILIPPINES UNDER WHOSE LAW THE AGE OF MAJORITY IS 18 YEARS, HE WAS NO LONGER A MINOR AT THE TIME OF PERFECTION OF THE CONTRACT. WILL THE SUIT PROSPER? A69: The suit will not prosper. Being a U.S. national, Albert’s capacity to enter into a contract is determined by the law of the State of which he is a national, under which he to still a minor. This is in connection with Article 15 of the Civil Code which embodies the said nationality principle of lex patriae. While this principle is intended to apply to Filipino citizens under that provision, the Supreme Court in Recto v. Harden [100 Phil 427, (1959)] is of the view that the status or capacity of foreigners is to be determined on the basis of the same provision or principle, i.e., by U.S. law in the present problem. Q70: ALMA WAS HIRED AS A DOMESTIC HELPER IN HONGKONG BY THE DRAGON SERVICES, LTD., THROUGH ITS LOCAL AGENT. SHE EXECUTED A STANDARD EMPLOYMENT CONTRACT DESIGNED BY THE PHILIPPINE OVERSEAS WORKERS ADMINISTRATION (POEA) FOR OVERSEAS FILIPINO WORKERS. IT PROVIDED FOR HER EMPLOYMENT FOR ONE YEAR AT A SALARY OF US$1,000.00 A MONTH. IT WAS SUBMITTED TO AND APPROVED BY THE POEA. HOWEVER, WHEN SHE ARRIVED IN HONGKONG, SHE WAS ASKED TO SIGN ANOTHER CONTRACT BY DRAGON SERVICES, LTD. WHICH REDUCED HER SALARY TO ONLY US$600.00 A MONTH. HAVING NO OTHER CHOICE, ALMA SIGNED THE CONTRACT BUT WHEN SHE RETURNED TO THE PHILIPPINES, SHE DEMANDED PAYMENT OF THE SALARY DIFFERENTIAL OF US$400.00 A MONTH. BOTH DRAGON SERVICES, LTD. AND ITS LOCAL AGENT CLAIMED THAT THE SECOND CONTRACT IS VALID UNDER THE LAWS OF HONGKONG, AND THEREFORE BINDING ON ALMA. IS THEIR CLAIM CORRECT? EXPLAIN. A70: Their claim is not correct. A contract is the law between the parties but the law can disregard the contract if it is contrary to public policy. Since the case is being litigated in the Philippines, the Philippine Court as the forum will not enforce any foreign claim obnoxious to the forum’s public policy. The provisions of the 1987 Constitution on the protection of labor and on social justice [Sec. 10. Art II] embody a public policy of the Philippines. Since the application of Hongkong law in this case is in violation of that public policy, the application shall be disregarded by our Courts. [Cadalin v. POEA, 238 SCRA 762, December 5, 1994] Q71: IN A CLASS SUIT FOR DAMAGES, PLAINTIFFS CLAIMED THEY SUFFERED INJURIES FROM TORTURE DURING MARTIAL LAW. THE SUIT WAS FILED UPON PRESIDENT EM’S ARRIVAL ON EXILE IN HI, A U.S. STATE. THE COURT IN HI AWARDED PLAINTIFFS THE EQUIVALENT OF P100 BILLION UNDER THE U.S. LAW ON ALIEN TORT CLAIMS. ON APPEAL, EM’S ESTATE RAISED THE ISSUE OF PRESCRIPTION. IT ARGUED THAT SINCE SAID U.S. LAW IS SILENT ON THE MATTER, THE COURT SHOULD APPLY: (1) HI’S LAW SETTING A TWO-YEAR LIMITATION ON TORT CLAIMS; OR (2) THE

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PHILIPPINE LAW WHICH APPEARS TO REQUIRE THAT CLAIMS FOR PERSONAL INJURY ARISING FROM MARTIAL LAW BE BROUGHT WITHIN ONE YEAR. PLAINTIFFS COUNTERED THAT PROVISIONS OF THE MOST ANALOGOUS FEDERAL STATUTE, THE TORTURE VICTIMS PROTECTION ACT, SHOULD BE APPLIED. IT SETS TEN YEARS AS THE PERIOD FOR PRESCRIPTION. MOREOVER, THEY ARGUED THAT EQUITY COULD TOLL THE STATUTE OF LIMITATIONS. FOR IT APPEARED THAT EM HAD PROCURED CONSTITUTIONAL AMENDMENTS GRANTING HIMSELF AND THOSE ACTING UNDER HIS DIRECTION IMMUNITY FROM SUIT DURING HIS TENURE. IN THIS CASE, HAS PRESCRIPTION SET IN OR NOT? CONSIDERING THE DIFFERENCES IN THE CITED LAWS, WHICH PRESCRIPTIVE PERIOD SHOULD BE APPLIED: ONE YEAR UNDER PHILIPPINE LAW, TWO YEARS UNDER HI’S LAW, TEN YEARS UNDER U.S. FEDERAL LAW, OR NONE OF THE ABOVE? EXPLAIN. A71: The US Court will apply US law, the law of the forum, in determining the applicable prescriptive period. While US law is silent on this matter, the US Court will not apply Philippine law in determining the prescriptive period. It is generally affirmed as a principle in private international law that procedural law is one of the exceptions to the application of foreign law by the forum. Since prescription is a matter of procedural law even in Philippine jurisprudence, [Cadalin v. POEA, 238 SCRA 721, December 5, 1994], the US Court will apply either HI or Federal law in determining the applicable prescriptive period and not Philippine law. The Restatement of American law affirms this principle. Q72: WHAT IS: (1) COGNOVIT? (2) A BORROWING STATUTE? (3) CHARACTERIZATION? A72: (1) Cognovit is an acknowledgement of debt or liability in the form of a confessed judgment. [Black’s Law Dictionary, 1996 ed.]; (2) Borrowing Statute is a legislative exception to the conflict-of-laws rule holding that forum state must apply its own statute of limitations. It specifies the circumstances in which a forum state may adopt another state’s statute of limitations [Black’s Law Dictionary, 1996 ed.]; (3) Characterization is otherwise called "classification" or "qualification." It is the process of assigning a disputed question to an area in substantive law. [Coquia and Pangalangan] Q73: MARVIN, A FILIPINO, AND SHELLEY, AN AMERICAN, BOTH RESIDENTS OF CALIFORNIA, DECIDED TO GET MARRIED IN THEIR LOCAL PARISH. TWO YEARS AFTER THEIR MARRIAGE, SHELLEY OBTAINED A DIVORCE IN CALIFORNIA. WHILE IN BORACAY, MARVIN MET MANEL, A FILIPINA, WHO WAS VACATIONING THERE. MARVIN FELL IN LOVE WITH HER. AFTER A BRIEF COURTSHIP AND COMPLYING WITH ALL THE REQUIREMENTS, THEY GOT MARRIED IN HONGKONG TO AVOID PUBLICITY, IT BEING MARVIN'S SECOND MARRIAGE. IS THE SECOND MARRIAGE VALID? A73: As to extrinsic validity, the marriage with Manel in Hong Kong is valid if it complied with the formalities of the place where it was celebrated, Hong Kong law, based on the principle of lex loci celebrationis. As to intrinsic validity, it depends if the divorce obtained by Shelley capacitated her to remarry. In Garcia v. Recio [G.R. No. 138322, October 2, 2001], the SC held that for a Filipino spouse to have the capacity to contract a subsequent marriage, it must also be proven that the foreign divorce obtained abroad by the foreigner spouse gave such foreigner spouse capacity to remarry. If such requirement is complied with, Marvin is likewise capacitated to remarry and the second marriage is considered valid. [Art. 26, Par. 2, Family Code] Q74: JUAN IS A FILIPINO CITIZEN RESIDING IN TOKYO, JAPAN. STATE WHAT LAWS GOVERN: (1) HIS CAPACITY TO CONTRACT MARRIAGE IN JAPAN; (2) HIS SUCCESSIONAL RIGHTS AS REGARDS HIS DECEASED FILIPINO FATHER’S PROPERTY IN TEXAS, U.S.A.; (3) THE EXTRINSIC VALIDITY OF THE LAST WILL AND TESTAMENT WHICH JUAN EXECUTED WHILE SOJOURNING IN SWITZERLAND; (4) THE INTRINSIC VALIDITY OF SAID WILL.

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A74: (1) Juan’s capacity to contract marriage is governed by Philippine law. This is pursuant to Art. 15 of the Civil Code, which provides that our laws relating to, among others, legal capacity of persons are binding upon citizens of the Philippines even though living abroad. (2) By way of exception to the general rule of lex rei sitae prescribed by the first paragraph of Art. 16 of the Civil Code, a person’s successional rights are governed by the national law of the decedent [Art. 16, Par. 2, Civil Code]. Since Juan’s deceased father was a Filipino citizen, his national law which is the Philippine law governs Juan’s successional rights. (3) The extrinsic validity of Juan’s will is governed by (a) Swiss law, it being the law where the will was made [Art. 17, Par. 1, Civil Code], or (b) Philippine law, by implication from the provisions of Art. 816 of the Civil Code, which allows even an alien who is abroad to make a will in conformity with our Civil Code. (4) The intrinsic validity of his will is governed by Philippine law, it being his national law. [Art. 16, Civil Code] Q75: JACOB, A SWISS NATIONAL, MARRIED LOURDES, A FILIPINA, IN BERNE, SWITZERLAND. THREE YEARS LATER, THE COUPLE DECIDED TO RESIDE IN THE PHILIPPINES. JACOB SUBSEQUENTLY ACQUIRED SEVERAL PROPERTIES IN THE PHILIPPINES WITH THE MONEY HE INHERITED FROM HIS PARENTS. FORTY YEARS LATER. JACOB DIED INTESTATE, AND IS SURVIVED BY SEVERAL LEGITIMATE CHILDREN AND DULY RECOGNIZED ILLEGITIMATE DAUGHTER JANE, ALL RESIDING IN THE PHILIPPINES. (A) SUPPOSE THAT SWISS LAW DOES NOT ALLOW ILLEGITIMATE CHILDREN TO INHERIT, CAN JANE, WHO IS A RECOGNIZED ILLEGITIMATE CHILD, INHERIT PART OF THE PROPERTIES OF JACOB UNDER PHILIPPINE LAW? (B) ASSUMING THAT JACOB EXECUTED A WILL LEAVING CERTAIN PROPERTIES TO JANE AS HER LEGITIME IN ACCORDANCE WITH THE LAW OF SUCCESSION IN THE PHILIPPINES, WILL SUCH TESTAMENTARY DISPOSITION BE VALID? A75: (a) No, Swiss law applies. The intrinsic validity of Jacob’s will shall be governed by his national law at the time of his death [Art. 16, Par. 2, Civil Code]. As stated in the problem, Jacob is a Swiss national and Swiss law does not allow illegitimate children to inherit. Hence, Jane cannot inherit the property of Jacob under Philippine law. (b) No. The testamentary disposition will not be valid if it would contravene Swiss law; otherwise, the disposition would be valid. However, if Swiss law is not proved, it would be presumed to be the same as that of Philippine law under the Doctrine of Presumed Identity or Processual Presumption. [Miciano v. Brimo, 50 Phil. 867, November 1, 1924] Under this doctrine, if the foreign law involved is not properly pleaded and proved, our courts will presume that the foreign law is the same as our local or domestic or internal law. In such case, the testamentary disposition will be valid because Philippine law recognizes legitime of illegitimate children. Q76: WHAT IS THE DOCTRINE OF FORUM NON CONVENIENS? A76: Forum non conveniens is a principle in Private International Law that where the ends of justice strongly indicate that the controversy may be more suitably tried elsewhere, jurisdiction should be declined and the parties relegated to relief to be sought in another forum. [Moreno. Philippine Law Dictionary, p. 254, 1982 ed.] Q77: DISTINGUISH BRIEFLY BETWEEN: DOMICILIARY THEORY AND NATIONALITY THEORY OF PERSONAL LAW. A77: Domiciliary theory posits that the personal status and rights of a person are governed by the law of his domicile or the place of his habitual residence. The nationality theory, on the other hand, postulates that it is the law of the person's nationality that governs such status and rights. Q78: KEVIN AND SUSAN ARE CHINESE NATIONALS. THEIR PARENTS ARE NOW FILIPINO CITIZENS WHO LIVE IN MANILA. WHILE STILL STUDENTS IN MNS STATE, THEY GOT MARRIED IN ACCORDANCE Page 27 of 40

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WITH THE LAWS OF THAT STATE, ALTHOUGH THEY ARE FIRST COUSINS. IT APPEARS UNDER CHINESE LAW THAT FIRST COUSINS COULD MARRY LEGALLY. HOWEVER, IN MNS STATE, IT IS NOT LEGAL. THEY PLAN TO RESIDE AND SET UP BUSINESS IN THE PHILIPPINES. BUT THEY HAVE BEEN INFORMED, HOWEVER, THAT THE MARRIAGE OF FIRST COUSINS HERE IS CONSIDERED VOID FROM THE BEGINNING BY REASON OF PUBLIC POLICY. (1) IS THE MARRIAGE VALID? (2) WILL THEIR MARRIAGE BE RECOGNIZED AS VALID IN THE PHILIPPINES? A78: (1). Yes, the marriage is valid. Lex loci celebrationis governs the extrinsic validity of the marriage but under the principle of lex nationalii, the personal capacity of the parties to enter into the marriage is governed by their national laws. In this case, their national law, Chinese law, allows marriage between first cousins, and it is stated in the facts that their marriage was celebrated in accordance with MNS State law. (2). Yes, their marriage will be recognized as valid in the Philippines, since it is valid where celebrated. This is based on lex loci celebrationis principle under Art. 26, Par. 1 of the Family Code. The prohibitions against marriage between first cousins on the ground of public policy will not apply in this case as they are not Filipino nationals.

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PROPERTY Q79: THE PROPERTIES OF KHLOE AND KENDALL, WHO ARE NEIGHBOURS, LIE ALONG THE BANKS OF THE MARIKINA RIVER. AT CERTAIN TIMES OF THE YEAR, THE RIVER WOULD SWELL AND AS THE WATER RECEDES, SOIL, ROCKS AND OTHER MATERIALS ARE DEPOSITED ON KHLOE AND KENDALL’S PROPERTIES. THIS PATTERN OF THE RIVER SWELLING, RECEDING AND DEPOSITING SOIL AND OTHER MATERIALS BEING DEPOSITED ON THE NEIGHBOURS’ PROPERTIES HAVE GONE ON FOR MANY YEARS. KNOWING THIS PATTERN, KHLOE CONSTRUCTED A CONCRETE BARRIER ABOUT 2 METERS FROM HER PROPERTY LINE AND EXTENDING TOWARDS THE RIVER, SO THAT WHEN THE WATER RECEDES, SOIL AND OTHER MATERIALS ARE TRAPPED WITHIN THIS BARRIER. AFTER SEVERAL YEARS, THE AREA BETWEEN KHLOE'S PROPERTY LINE TO THE CONCRETE BARRIER WAS COMPLETELY FILLED WITH SOIL, EFFECTIVELY INCREASING KHLOE'S PROPERTY BY 2 METERS. KENDALL'S PROPERTY, WHERE NO BARRIER WAS CONSTRUCTED, ALSO INCREASED BY ONE METER ALONG THE SIDE OF THE RIVER. (A) CAN KHLOE AND KENDALL LEGALLY CLAIM OWNERSHIP OVER THE ADDITIONAL 2 METERS AND ONE METER, RESPECTIVELY, OF LAND DEPOSITED ALONG THEIR PROPERTIES? (B) IF KHLOE AND KENDALL’S PROPERTIES ARE REGISTERED, WILL THE BENEFIT OF SUCH REGISTRATION EXTEND TO THE INCREASED AREA OF THEIR PROPERTIES? A79: (a) Only Kendall can claim ownership over the additional one meter of land deposited along her property. Art. 457 provides that "to the owners of lands adjoining the banks of river belong the accretion which they gradually receive from the effects of the current of the water." Where the land is not formed solely by the natural effect of the water current of the river bordering land but is also the consequences of the direct and deliberate intervention of man, it is man-made accretion and a part of the public domain [Vda. de Nazareno v. CA, G.R. No. 98045. June 26, 1996]. Thus, Khloe cannot legally claim ownership of the additional 2 meters of land along her property because she constructed a concrete barrier about 2 meters from her property causing deposits of soil and other materials when the water recedes. In other words, the increase in her property was not caused by nature but was man-made. (b) If the properties of Khloe and Kendall are registered, the benefit of such registration does not extend to the increased area of their properties. Accretion does not automatically become registered land because there is a specific technical description of the lot in its Torrens title. There must be a separate application for registration of the alluvial deposits under the Torrens System (Grande v. CA, G.R. No. L-17652, June 30, 1962). Q80: DEFINE AND DIFFERENTIATE BETWEEN ALLUVIUM AND AVULSION. A80: (1) Alluvium is accretion received by the land adjoining the banks of the river which must be the result of the natural action of the current of the river. In contrast, avulsion refers to the portion of land that was transferred to another estate caused by the current of a river, creek of torrent. (2) In alluvium, accretion is gradual and cannot be identified but in avulsion, accretion is sudden, abrupt, and identifiable. (3) There is merely an attachment of land in alluvium while in avulsion, there must be a detachment followed by an attachment. (4) In alluvium, the accretion belongs to the owner of the land to which the attachment is made ipso jure. However, in avulsion, ownership is retained by the owner of the land from which it is detached, at least, for a certain period. Q81: THE RENUNCIATION BY A CO-OWNER OF HIS UNDIVIDED SHARE IN THE CO-OWNED PROPERTY IN LIEU OF THE PERFORMANCE OF HIS OBLIGATION TO CONTRIBUTE TO TAXES AND EXPENSES FOR THE PRESERVATION OF THE PROPERTY CONSTITUTES DACION EN PAGO. TRUE OR FALSE? EXPLAIN. A81: True. Under Art. 488, NCC, a co-owner may renounce his share in the co-owned property in lieu of paying for his share in the taxes and expenses for the preservation of the co-owned property. In effect, Page 29 of 40

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there is dacion en pago because the co-owner is discharging his monetary obligation by paying it with his non-monetary interest in the co-owned property. Q82: SPOUSES REYES MANAGED AND OPERATED A HARDWARE STORE ON A 500 SQ.M. LOT WHICH THEY LEASED FROM JOHN DESIDERIO. THE CONTRACT WAS FOR A PERIOD OF THREE (3) YEARS. WHEN THE CONTRACT EXPIRED, JOHN ASKED THE SPOUSES TO PEACEFULLY VACATE THE PREMISES. THE SPOUSES IGNORED THE DEMAND AND CONTINUED WITH THE OPERATION OF THE HARDWARE. ONE MONTH AFTER, JOHN, WITH THE AID OF A GROUP OF ARMED MEN, CAUSED THE CLOSURE OF THE HARDWARE BY CONSTRUCTING FENCES AROUND IT. WAS THE ACT OF JOHN AND HIS MEN LAWFUL? EXPLAIN. A82: No, the act was not lawful. Even if the lessee’s right to occupy the premises has expired, the lessor cannot physically oust the lessee from the leased premises if the latter refuses to vacate. The lessor must go through the proper channels by filing an appropriate case for unlawful detainer or recovery of possession. Every possessor has a right to be respected in his possession [Article 539] and in no case my possession be acquired through force or intimidation as long as there is a possessor who objects thereto [Article 536]. The act of John is an abuse of rights because even if he has the right to recover possession of his property, he must act with justice and give the lessees their day in court and observe honesty and good faith. Q83: X, Y, Z ARE SIBLINGS WHO INHERITED A 10-STORY BUILDING FROM THEIR PARENTS. THEY AGREED IN WRITING TO MAINTAIN IT AS A CO-OWNED PROPERTY FOR LEASING OUT AND TO DIVIDE THE NET PROFITS AMONG THEMSELVES EQUALLY FOR A PERIOD OF 20 YEARS. ON THE 9TH YEAR, X WANTED TO GET OUT OF THE CO-OWNERSHIP SO HE COULD GET HIS 1/3 SHARE IN THE PROPERTY. Y AND Z REFUSED, SAYING X IS BOUND BY THEIR AGREEMENT TO KEEP THE CO-OWNERSHIP FOR 20 YEARS. ARE Y AND Z CORRECT? EXPLAIN. A83: Y and Z are partly correct. The law provides that none of the co-owners shall be obliged to remain in the co-ownership and it is the right of a co-owner to ask for partition of the co-ownership anytime. One exception to the rule is if the co-owners agree to keep the thing undivided which period shall not exceed ten years. In this case, the agreement to keep the thing undivided shall be valid at the most for ten years. [Article 494] Q84: DISTINGUISH A USUFRUCT FROM AN EASEMENT. A84: (1) A usufruct may be constituted on either movable or immovable property, while an easement may only be constituted on an immovable property. (2) A usufruct is extinguished by the death of the usufructuary, but an easement is not extinguished by the death of the dominant owner. (3) A usufruct involves a right of possession in an immovable; an easement, a non-possessory right over an immovable. (4) All the uses and the fruits of the property are included in a usufruct, but an easement is limited to a particular or specific use of the servient estate. Q85: WHAT ARE THE COMPULSORY REQUISITES FOR A RIGHT OF WAY? A85: (1) The claimant must be an owner of enclosed immovable or one with real right; (2) there must be no adequate outlet to a public highway; (3) the right of way must be absolutely necessary; (4) the isolation must not be due to claimant’s act; (5) the right of way must be established at the point least prejudicial to the servient estate; and (6) there must be payment of proper indemnity. [Art. 629]

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Q86: JON WAS THE OWNER OF LOT A, WHICH WAS SURROUNDED BY 5 OTHER LOTS, LOTS B TO F. LOT B WAS ALSO OWNED BY JON. HE PROMISED DANY THAT IF SHE BOUGHT LOT C, HE WOULD GIVE HER A RIGHT OF WAY IN LOT B. CONVINCED, DANY BOUGHT LOT C; AND JON GAVE HER A RIGHT OF WAY IN LOT B. DANY CULTIVATED LOT C AND MADE USE OF THE RIGHT OF WAY ON LOT B. DANY LATER FOUND GAINFUL EMPLOYMENT ABROAD. SHE RETURNED AFTER 11 YEARS AND FOUND THAT THE RIGHT OF WAY WAS NO LONGER AVAILABLE TO HER BECAUSE JON SOLD LOT B TO YGRITTE, AND THE LATTER HAD THE LOT FENCED. (A) CAN DANY DEMAND THE ACTIVATION OF HER RIGHT OF WAY FROM YGRITTE? (B) CAN DANY OPT TO DEMAND A RIGHT OF WAY FROM THE ANY OF THE OTHER OWNERS OF THE SURROUNDING LOTS? A86: (a) Yes, Dany can demand the activation of her right of way from Ygritte. An easement of right of way is a real right, which attaches to the estate to which it belongs, and is inseparable therefrom [Art. 617]. The sale of the property includes the easement whether or not such is indicated in the deed of sale. The buyer of the property in which an easement exists cannot prevent the dominant estate from using it. The fact that Dany worked abroad for 11 years should not be considered as non-user, because the fact that the right of way was not used by those left behind to cultivate Lot C cannot be implied from such fact. Nor is there renunciation or waiver of the easement in this case because this must be specific, clear, express, and made in a public instrument [Art. 1358]. (b) Yes, Dany can also opt to demand a right of way from the other owners. The requisites under Art. 649 for a compulsory right of way are complied with in this case. Alternatively, Art. 652 provides that whenever a piece of land acquired by sale, exchange or partition, is surrounded by other estates of the vendor, exchanger, or co-owner, he shall be obliged to grant a right of way without indemnity. Q87: WHEN HER RELATIVES CAME TO VISIT HER AT HER HOUSE, MRS. KOHREYNA GRABBED ONE OF HER MOST TREASURED BOOKS AND SHOWED IT TO BROTHERS MARLOU AND XANDER, HER FAVORITE NEPHEWS. SHE TOLD THEM WHAT THE BOOK IS ABOUT, HOW EXPENSIVE AND RARE IT IS, AND HOW IT WAS HER FAVORITE BOOK OF ALL TIME. MRS. KOHREYNA THEN TOLD MARLOU AND XANDER THAT SHE WAS DONATING THE BOOK TO THEM BOTH. BEFORE THE TWO COULD REACT OR SAY ANYTHING IN RESPONSE, A COMMOTION ENSUED AS XANDER WAS PULLED OUT OF THE LIVING ROOM BY THEIR MOTHER AND WAS DRAGGED TO THEIR CAR, AS XANDER WAS SUPPOSED TO BE ON HIS WAY TO THE AIRPORT ALREADY SO AS NOT TO MISS HIS FLIGHT FOR HIS INTERNATIONAL EXCHANGE STUDENT PROGRAM. WHEN THINGS WENT BACK TO NORMAL IN THE LIVING ROOM, MARLOU RESPONDED TO MRS. KOHREYNA, SAYING THAT HE IS ACCEPTING THE DONATION. MRS. KOHREYNA REQUESTED MARLOU TO ASK XANDER VIA VIBER IF HE ACCEPTS THE DONATION, TOO. HOWEVER, AS MARLOU WAS WAITING FOR XANDER’S REPLY, MRS. KOHREYNA WAS HIT IN THE HEAD WITH A STRAY BULLET WHICH CAME FROM THE ROOF, KILLING HER INSTANTLY. MARLOU TRIED CPR ON MRS. KOHREYNA, TO NO AVAIL. WAS THERE A VALID ACCEPTANCE OF THE DONATED BOOK? A87: No. A joint donation, or that donation made to two or more persons, could not be accepted solely by one of the donees independently of the other donee [Art. 753; Genato v. Lorenzo, G.R. No. L-24983, May 20, 1968]. In this case, since the donation intended was a joint one to both Marlou and Xander, Marlou alone could not accept the book independently of his co-donee Xander, for there is no accretion among donees unless expressly so provided, or unless they be husband and wife [Art. 753; Genato v. Lorenzo, G.R. No. L-24983, May 20, 1968]. Xander was not present at the delivery, and there is no showing that he had, after the offer was made and before Mrs. Kohreyna died, authorized his brother, Marlou, to accept donations for both of them. Hence, Marlou’s acceptance of the book solely before Mrs. Kohreyna’s death could not have operated as a valid acceptance for the joint donation.

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SALES Q88: DISTINGUISH BETWEEN A CONTRACT OF SALE AND A CONTRACT TO SELL. A88: In a contract of sale, the title to the property passes to the buyer upon the delivery of the thing sold. In a contract to sell, the ownership is, by agreement, retained by the seller and is not to pass to the vendee until full payment of the purchase price. In the contract of sale, the buyer’s non-payment of the price is a negative resolutory condition; in a contract to sell, the buyer’s full payment of the price is a positive suspensive condition to the coming into effect of the agreement. In a contract of sale, the seller has lost and cannot recover the ownership of the property unless he takes action to set aside the contract of sale. In the second case, the title simply remains in the seller if the buyer does not comply with the condition precedent of making payment at the time specified in the contract. [Heirs of Atienza v. Espidol, G.R. No. 180665, August 11, 2010] Q89. WHAT IS AN OPTION CONTRACT? A89: An option contract is a privilege existing in one person, for which he had paid a consideration, which gives him the right to buy, for example, certain merchandise of certain specified property, from another person, if he chooses, at any time within the agreed period, at a fixed price. The contract of option is a separate and distinct contract from the contract which the parties may enter into upon the consummation of the option. A consideration for an optional contract is just as important as the consideration for any other kind of contract. If there was no consideration for the contract of option, then it cannot be entered any more than any other contract where no consideration exists. A contract of option is a contract by virtue of the terms of which the parties thereto promise and obligate themselves to enter into contract at a future time, upon the happening of certain events, or the fulfilment of certain conditions. [Enriquez de la Cavada v. Diaz, G.R. No. L-11668, April 1, 1918] Q90. IS EARNEST MONEY PART OF THE PURCHASE PRICE? A90: Yes. Whenever earnest money is given in a contract of sale, it shall be considered as part of the price and as proof of the perfection of the contract. [Art. 1482] Q91. ON JANUARY 12, BEFORE LIANA LEFT FOR CANADA, SHE SOLD TO JOHNNY A RELATIVELY NEW MERCEDES BENZ. ON JANUARY 25, JOHNNY TOOK POSSESSION OF SAID MERCEDES BENZ. ON NOVEMBER 6, ROBERT WENT TO JOHNNY TO RETRIEVE THE CAR SAYING THAT HE BOUGHT THE SAME CAR FROM LIANA ON MARCH 9. WHO BETWEEN JOHNNY AND ROBERT HAS ACQUIRED OWNERSHIP OF THE CAR? A91: Johnny. If the same thing should have been sold to different vendees, the ownership shall be transferred to the person who may have first taken possession thereof in good faith, if it should be movable property. [Art. 1544] Q92. FROM THE FACTS ABOVE, IF THE PROPERTY INVOLVED WAS A REGISTERED/TITLED PARCEL OF LAND IN PARANAQUE, AND LOUIE HAD THE SALE TO HIM REGISTERED ON MARCH 10 AFTER LEARNING THAT THE LOT WAS SOLD TO JOHNNY, WILL THE ANSWER STILL BE THE SAME? A92: Yes. The rule on double sales of registered land states that ownership is deemed acquired by the person who first registers the property in his name in good faith. In this case, Louie registered it in bad faith. In order for the second buyer to displace the first buyer the second buyer must show that he acted

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in good faith (i.e., in ignorance of the first sale and of the first buyers rights) from the time of acquisition until title is transferred to him by registration or failing registration, by delivery of possession. [Cheng v. Genato, G.R. No. 129760, December 29, 1998] Q93. WHAT IS THE REMEDY OF AN APPARENT VENDOR WHEN THE INSTRUMENT IS FOUND TO BE AN EQUITABLE MORTGAGE? A93: Reformation of the instrument. [Art. 1605] Q94. JUAN OWNS A UNIT IN A CONDOMINIUM CALLED RESIDENCIA DE REGINA VELASQUEZ. TOGETHER WITH OTHER OWNERS OF THE SEPARATE UNITS IN THE CONDOMINIUM, HE IS DEEMED A CO-OWNER OF THE STUDENT LOUNGE WHICH IS A COMMON AREA. HE WANTS TO SELL HIS UNIT TO TYLER, AN AMERICAN CITIZEN. IS THIS ALLOWED UNDER RA 4726 OR THE CONDOMINIUM ACT? A94: No. Where the common areas in the condominium project are owned by the owners of separate units as co-owners thereof, no condominium unit therein shall be conveyed or transferred to persons other than Filipino citizens, or corporations at least sixty percent of the capital stock of which belong to Filipino citizens, except in cases of hereditary succession. [Sec. 5, RA 4726] Q95. IS THE CONDOMINIUM CORPORATION, BY ITSELF, ALLOWED TO SELL, EXCHANGE, LEASE OR DISPOSE OF THE COMMON AREAS HELD BY IT? A95: No. A condominium corporation shall not, during its existence, sell, exchange, lease or otherwise dispose of the common areas owned or held by it in the condominium project unless authorized by the affirmative vote of ALL the stockholders or members. [Sec. 16, RA 4726] Q96. NOT EVERY PURCHASER OF A CONDOMINIUM UNIT IS A SHAREHOLDER OF A CONDOMINIUM CORPORATION. TRUE OR FALSE? A96: True. The Condominium Act leaves to the Master Deed the determination of when the shareholding will be transferred to the buyer of the unit. But ownership of a unit is an indispensable requisite to being a shareholder in the corporation. [Sunset View Condominium Corporation v. Campos, G.R. No. L-52361, April 27, 1981] Q97. IN THE DELIVERY OF A THING SOLD, WHAT ARE THE OPTIONS OF A BUYER IF THE QUANTITY OF THE MOVABLES DELIVERED IS LESS THAN EXPECTED? A97: The option of the buyer are the following: 1.

Buyer may reject all

2. Buyer may accept a. If buyer accepts with knowledge of seller’s inability to deliver the rest – buyer pays contract rate b. If Buyer has used or disposed of the goods delivered prior to knowing seller’s inability to deliver the rest, or if buyer does not know of seller’s inability to deliver the rest – buyer pays fair value [Art. 1522]

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Q98: THE HOLOGRAPHIC WILL OF A, THE TESTATOR, WAS ACCIDENTALLY BURNED IN A FIRE. THE CONTENTS OF THE HOLOGRAPHIC WILL WERE KNOWN TO D, A’S BEST FRIEND. WOULD THE HOLOGRAPHIC WILL BE PROBATED? A98: No. In the probate of the holographic will, the document itself must be presented to determine its authenticity. Unfortunately, in this case, the holographic will was burnt. [Gan v. Yap, G.R. No. L-12190, August 30, 1958] Q99: A WAS EXECUTING A NOTARIAL WILL, AND WHILE DOING SO ONE OF HIS THREE WITNESSES LOOKED OUT THE WINDOW AND DID NOT SEE A SIGN HIS WILL. IS THE WILL VALID? A99: Yes. The law does not require a witness to actually see the testator sign the will. It is sufficient if the witness could have seen the act of signing had he chosen to do so by casting his eyes to the proper direction, and without any physical obstruction to prevent his doing so (test of position). [Nera v. Rimando, G.R. No. L-597, February 27, 191] Q100: A DIED AND LEFT BEHIND HER HOLOGRAPHIC WILL WHICH IS ENTIRELY WRITTEN, DATED AND SIGNED IN HER OWN HANDWRITING. HOWEVER, IT CONTAINS CANCELLATIONS WHICH ARE NOT AUTHENTICATED BY A’S FULL SIGNATURE. MAY A’S WILL, AS ORIGINALLY WRITTEN, STILL BE PROBATED? A100: Yes, the will as originally written may be probated. The cancellations or alterations are void since they were not authenticated by the full signature of A. The original will remains valid because a holographic will is not invalidated by the unauthenticated insertions or alterations. [Art. 814; Ajero v. CA, G.R. No. 106720, September 15, 1994] Q101: A IS THE ILLEGITIMATE DAUGHTER OF X & Y, AND SHE DIED INTESTATE WITHOUT ANY ASCENDANTS OR DESCENDANTS. B, THE LEGITIMATE DAUGHTER OF X & Y, CLAIMS A’S ESTATE. IS B ENTITLED TO INHERIT FROM A? A101: No. An illegitimate child has no right to inherit ab intestato from the legitimate children and relatives of his father or mother; nor shall such children or relatives inherit in the same manner from the illegitimate child. [Art. 992] Q102: A, MARRIED TO B, EXECUTED A WILL BEQUEATHING ALL HER PROPERTIES TO HER FRIEND, C. UPON A’S DEATH, THE WILL WAS PRESENTED FOR PROBATE. B OPPOSED THE PROBATE OF THE WILL ON THE GROUND OF PRETERITION. DOES THE OMISSION OF B ANNUL THE INSTITUTION OF C AS HEIR. A102: No. B’s omission of A is not preterition of a compulsory heir in the direct line, thus Art. 854 does not apply. The institution of C is valid but only up to the free portion of ½. B, as the surviving spouse, is still entitled to ½ of A’s estate as his legitime under Art. 900. Q103: A HAS 3 DAUGHTERS, A1, A2, AND A3. HE DISINHERITED A1 BECAUSE A1 MARRIED A GUY HE DID NOT LIKE AND INSTITUTED A2 AND A3 TO HIS ENTIRE ESTATE OF P1,000,000. IS THE DISINHERITANCE VALID? A103: No, this is a case of ineffective disinheritance, as marrying a man her father does not approve of is not a ground for disinheritance. Art. 919 provides the grounds for disinheritance of children and Page 34 of 40

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descendants – The following shall be sufficient causes for the disinheritance of children and descendants, legitimate as well as illegitimate: (1) When a child or descendant has been found guilty of an attempt against the life of the testator, his or her spouse, descendants, or ascendants; (2) When a child or descendant has accused the testator of a crime for which the law prescribes imprisonment for six years or more, if the accusation has been found groundless; (3) When a child or descendant has been convicted of adultery or concubinage with the spouse of the testator; (4) When a child or descendant by fraud, violence, intimidation, or undue influence causes the testator to make a will or to change one already made; (5) A refusal without justifiable cause to support the parent or ascendant who disinherits such child or descendant; (6) Maltreatment of the testator by word or deed, by the child or descendant; (7) When a child or descendant leads a dishonorable or disgraceful life; (8) Conviction of a crime which carries with it the penalty of civil interdiction. Q104: A WAS BORN BLIND. HE WENT TO A SCHOOL FOR THE BLIND, AND LEARNED TO READ IN BRAILLE. HE SPEAKS ENGLISH FLUENTLY. CAN HE MAKE A WILL? A104: Assuming that he is of legal age [Art. 797] and of sound mind at the time of execution of the will [Art. 798], A, a blind person, can make a notarial will, subject to compliance with the “two-reading rule” [Art. 808] and the provisions of Arts. 804, 805, and 806. The “two-reading rule” states that if the testator is blind, the will shall be read to him twice; once, by one of the subscribing witnesses, and again, by the notary public before whom the will is acknowledged. Q105: DISTINGUISH BETWEEN SIMPLE AND FIDEICOMMISSARY SUBSTITUTION OF HEIRS. A105: In a simple substitution of heirs, the testator designates one or more persons to substitute the heirs instituted in case such heir or heirs should die before him, or should not wish or should be incapacitated to accept the inheritance. In a fideicommissary substitution, the testator institutes a first heir and charges him to preserve and transmit the whole or part of the inheritance to a second heir. In a simple substitution, only one heir inherits. In a fideicommissary substitution, both the first and second heirs inherit. [Art 859 and 869] Q106: A, WHILE A FILIPINO CITIZEN, SIRED AN ILLEGITIMATE CHILD, C, WITH B. HE LATER MIGRATED TO NEW YORK, USA AND THERE, BECAME AN AMERICAN CITIZEN. THE STATE OF NEW YORK DOES NOT RECOGNIZE COMPULSORY HEIRS. CAN C, A’S ILLEGITIMATE CHILD, INSIST ON HER LEGITIME UPON A’S DEATH? A106: No. A died an American citizen and the national law of the testator determines succession. [Art. 16] Under New York law, compulsory heirs aren’t recognized, therefore, C cannot insist on her legitime.

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TORTS AND DAMAGES Q107: AFTER TEN YEARS AS A COUPLE, A PROPOSED TO B, WHO WAS ECSTATIC AND IMMEDIATELY ACCEPTED THE PROPOSAL. AFTER TWO YEARS OF PLANNING DURING WHICH ALL THE NECESSARY ARRANGEMENTS AND CORRESPONDING PAYMENTS WERE MADE BY B’S FAMILY, A DISAPPEARED AND NEVER SHOWED HIMSELF TO B OR HER FAMILY AGAIN. B SUED A UNDER ARTICLE 21 FOR BREACH OF PROMISE TO MARRY. IN HIS DEFENSE, A ALLEGED THAT BREACH OF PROMISE TO MARRY IS NOT AN ACTIONABLE WRONG, AND HE CANNOT BE HELD LIABLE FOR DAMAGES UNDER ARTICLE 21. MAY A BE HELD LIABLE FOR DAMAGES? A107: Yes. Mere breach of promise to marry is not an actionable wrong, but when it is done contrary to morals, good customs, and public policy and with intent to injure, such breach is actionable. The case of Wassmer v. Velez [G.R. No. L-20089, December 26, 1964] is applicable. In that case, the bride had already set a wedding and went through all necessary preparations and publicity, only to walk out when the marriage was about to be solemnized. It was palpably contrary to morals, good customs, and public policy. In this case, the same set of circumstances was present. Q108: BEN WAS DRIVING ON COMMONWEALTH AVENUE WHEN HE RECEIVED A STARTLING TEXT MESSAGE FROM HIS WIFE, CAUSING HIM TO HIT THE BRAKES ABRUPTLY. MANONG, WHO WAS THEN DRIVING A PASSENGER JEEP CARRYING JANE, CRASHED INTO BEN’S CAR FROM BEHIND. JANE SUFFERED AN ABRASION ON HER FACE AS A RESULT OF THE CRASH AND SUED DOMENG (THE OWNER OF THE JEEP) FOR DAMAGES. DOMENG ALLEGED IN HIS DEFENSE THAT SINCE BEN’S NEGLIGENCE IN ABRUPTLY BRAKING WAS THE PROXIMATE CAUSE OF THE ACCIDENT, DOMENG CANNOT BE HELD LIABLE FOR DAMAGES TO JANE. IS DOMENG CORRECT? A108: No. The doctrine of proximate cause is applicable only in actions for quasi-delict, not in actions involving breach of contract. The doctrine is a device for imputing liability to a person where there is no relation between the parties; but where there is a pre-existing contractual relation between them, it is the parties themselves that create the obligation. The action can be prosecuted merely by proving the existence of the contract and the fact that the obligor, in this case the common carrier, failed to transport his passenger safely to his destination. [Calalas v. CA, G.R. No. 122039. May 31, 2000]. Q109: MARK WAS A BAGGER AT SM HYPERMART. ONE BUSY SUNDAY MORNING, THE SECURITY GUARD REPORTED TO THE MANAGER THAT HE SAW MARK PLACING A KITKAT BAR IN HIS BAG WITHOUT PAYING FOR IT. THE MANAGER IMMEDIATELY WENT TO THE BAGGER’S STATION, PULLED MARK BY HIS COLLAR AND SCREAMED, “MAGNANAKAW! TANGGAL KA NA SA TRABAHO!” UPON INSPECTION, NO KITKAT BAR WAS FOUND IN MARK’S BAG. THE MANAGER WHISPERED AN APOLOGY AND SAID THAT MARK WASN’T REALLY FIRED. MARK FILED A COMPLAINT FOR DAMAGES AGAINST THE MANAGER ON THE BASIS OF ARTICLES 19 AND 21 OF THE CIVIL CODE. THE MANAGER DISCLAIMED LIABILITY ON THE GROUND THAT HE ACTED IN GOOD FAITH UPON A WELL-FOUNDED BELIEF IN DISMISSING THE EMPLOYEE AND WAS ONLY LOOKING OUT FOR THE INTERESTS OF THE EMPLOYER. IS THE MANAGER LIABLE FOR DAMAGES? A109: Yes. While the employer, represented by the manager, has a right to dismiss the employee for misconduct, the manner of this right was exercised constituted a violation of Article 19, as such was based on unfounded accusations of dishonesty [Globe v. CA, G.R. No. 81262 August 25, 1989]. Q110: VALMONTE WAS HIRED AS A WEDDING COORDINATOR. ON THE DAY OF THE WEDDING, SHE LEFT THE BRIDAL SUITE TO RUN A FEW ERRANDS. UPON HER RETURN, SHE WAS ACCOSTED BY THE BRIDE’S AUNT CARPIO IN FRONT OF THE ENTIRE ENTOURAGE AND ACCUSED OF STEALING THE Page 36 of 40

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BRIDE’S JEWELRY THAT HAD GONE MISSING. CAN VALMONTE RECOVER DAMAGES FROM CARPIO UNDER ARTICLE 19 OF THE CIVIL CODE? A110: Yes. To find the existence of an abuse of right under Article 19, the following elements must be present: (1) there is a legal right or duty; (2) which is exercised in bad faith; (3) for the sole intent or prejudicing or injuring another. By openly accusing respondent as the only person who went out of the room before the loss of the jewelry in the presence of all the guests therein, and ordering that she be immediately bodily searched, petitioner virtually branded respondent as the thief. True, petitioner had the right to ascertain the identity of the malefactor, but to malign respondent without an iota of proof that she was the one who actually stole the jewelry is an act which, by any standard or principle of law is impermissible. Petitioner had willfully caused injury to respondent in a manner which is contrary to morals and good customs [Carpio v Valmonte G.R. No. 151866. September 9, 2004]. Q111: WHAT ARE THE ELEMENTS OF A QUASI-DELICT UNDER ARTICLE 2176 OF THE CIVIL CODE? A111: (1) There must be an act or omission; (2) Such act or omission causes damage to another; (3) Is caused by fault or negligence; and (4) There is no pre-existing contractual relation between the parties. Q112: IN WHAT CASES MAY MORAL DAMAGES BE AWARDED? A112: Under Art. 2219, moral damages may be recovered in the following and analogous cases: 1.

A criminal offense resulting in physical injuries;


2. Quasi-delicts causing physical injuries;
 3. Seduction, abduction, rape, or other lascivious acts; 4. Adultery or concubinage;
 5. Illegal or arbitrary detention or arrest;
 6. Illegal search;
 7. Libel, slander or any other form of defamation; 8. Malicious prosecution; 9. Acts mentioned in article 309;
 10. Acts and actions referred to in articles 21, 26, 27, 28, 29, 30, 32, 34, and 35. Q113: WHEN MAY ATTORNEY’S FEES BE AWARDED? A113: Under Art. 2208, in the absence of stipulation, attorney's fees and expenses of litigation, other than judicial costs, cannot be recovered, except: 1.

When exemplary damages are awarded;

2. When the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest; 3. In criminal cases of malicious prosecution against the plaintiff; 4. In case of a clearly unfounded civil action or proceeding against the plaintiff;

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5. Where the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiff's plainly valid, just and demandable claim; 6. In actions for legal support; 7. In actions for the recovery of wages of household helpers, laborers and skilled workers; 8. In actions for indemnity under workmen's compensation and employer's liability laws; 9. In a separate civil action to recover civil liability arising from a crime; 10. When at least double judicial costs are awarded; 11. In any other case where the court deems it just and equitable that attorney's fees and expenses of litigation should be recovered. Q114: WHAT ARE THE ELEMENTS OF THE DEFENSE OF RES IPSA LOQUITOR? A114: (1) The accident is of a kind which ordinarily does not occur in the absence of someone’s negligence; (2) It is caused by an instrumentality within the exclusive control of the defendant or defendants; and (3) he possibility of contributing conduct, which would make the plaintiff responsible, is eliminated. Q115: DISTINGUISH ACTUAL FROM NOMINAL DAMAGES. A115: Actual damages

Nominal damages

Damages in satisfaction of, or in recompense for, loss or injury sustained.

Nominal damages are adjudicated in order that a right of the plaintiff, which has been violated or invaded by the defendant, may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him.

Awarded when:

Awarded when:

1. When there is a pecuniary loss suffered by plaintiff; 


1. There is an invasion or violation of any legal or property right. 


2. When he has alleged and prayed

for such relief (Manchester Dev’t Corp vs. CA, G.R. No. 75919 May 7, 1987); 


3. When he has duly proved it; 
 4. When provided by law or by stipulation. 
 Indemnification for damages is not The assessment of nominal damages is limited to damnum emergens (actual loss) left to the discretion of the trial court

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but extends to lucrum cessans (a cession according to the circumstances of the of gain or amount of profit lost). case. Generally, nominal damages by their nature are small sums fixed by the court without regard to the extent of the harm done to the injured party. However, it is generally held that a nominal damage is a substantial claim, if based upon the violation of a legal right; in such a case, the law presumes damage although actual or compensatory damages are not proven [Gonzales v. People, G.R. No. 159950, February 12, 2007]. Must be pleaded and proven.

Need not be pleaded and proven.

There must be pleading and proof of actual damages suffered for the same to be recovered. In addition to the fact that the amount of loss must be capable of proof, it must also be actually proven with a reasonable degree of certainty, premised upon competent proof or the best evidence obtainable. The burden of proof of the damage suffered is, consequently, imposed on the party claiming the same, who should adduce the best evidence available in support thereof... In the absence of corroborative evidence, it has been held that selfserving statements of account are not sufficient basis for an award of actual damages [Oceaneering Contractors v Baretto, G.R. No. 184215, February 9, 2011].

One does not ask for nominal damages, and it is in lieu of the actual, moral, temperate, or liquidated damages. A violation of the plaintiff’s right, even if only technical, is sufficient to support an award of nominal damages. Conversely, so long as there is a showing of a violation of the right of the plaintiff, an award of nominal damages is proper [Gonzales v PCIB, G.R. No.180257 February 23, 2011].

Q116: DISTINGUISH CULPA CONTRACTUAL FROM CULPA AQUILIANA. A116: According to Cangco v. Manila Railroad [G.R. No. L-12191, October 14, 1918], they differ in that: CULPA AQUILIANA Basis of liability

CULPA CONTRACTUAL

Fault or negligence or Breach of contract omission (first of the EE, which is then attributed to the ER)

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Fault or negligence or Contract omission itself

Nature of liability Vicarious liability or obligation of ER

Principal – direct and immediate

How rebutted

ER needs to show that he exercised the diligence of a good father of a family in the selection and supervision of EEs

Common exercised diligence breach

Burden of proof

Plaintiff should prove that the damages were caused by the negligent conduct of the defendant

Plaintiff should only prove that the contract exists and that the defendant has breached it – it is not necessary for the plaintiff to prove negligence

Statutory basis

2176; 2180 (CC)

1170; 1172; 1174 (CC)

carrier extraordinary to prevent

Q117: DISTINGUISH BETWEEN INJURY, DAMAGE, AND DAMAGES. A117: (1) Injury is an illegal invasion of a legal right. (2) Damage is the loss, hurt, or harm, resulting from the injury. (3) Damages is the recompense or compensation awarded.

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