REPUBLIC V LUZON STEVEDORING CORPORATION REYES; September 29, 1967

NATURE APPEAL from a decision of the Court of First Instance of Manila. FACTS - In the early afternoon of August 17, 1960, barge L-1892, owned by Luzon Stevedoring Corporation was being towed down the Pasig river by tugboats Bangus and Barbero also belonging to the same corporation, when the barge rammed against one of the wooden piles of the Nagtahan bailey bridge, smashing the posts and causing the bridge to list. The river, at that time, was swollen and the current swift, on account of the heavy downpour of Manila and the surrounding provinces on August 15 and 16, 1960. - Republic of the Philippines sued for actual and consequential damage caused by the said companys employees amounting to 200,000. Defendant company disclaimed liability on the grounds that it was brought about by force majeure as they exercised due diligence in the selection and supervision of its employees and that the Nagtahan Bailey Bridge is an obstruction to navigation. Defendant claims that got the strongest tugboats, and the more competent and experienced among its patrons. - Trial court found said company liable. It filed before the Supreme Court. ISSUES 1. WON the collision of appellants barge with the supports or piers of the Nagtahan bridge was in law caused by fortuitous event or force majeure, and 2. WON it was error for the Court to have permitted the plaintiff-appellee to introduce additional evidence of damages after said party had rested its case. HELD 1. No. For caso fortuito or force majeure (which in law are identical in so far as they exempt an obligor from liability) by definition, are extraordinary events not foreseeable or avoidable, events that could not be foreseen, or which, though foreseen, were inevitable (Art. 1174,CC). It is not therefore enough that the event should not have foreseen or anticipated as is commonly believed, but it must be one impossible to foresee or to avoid. The mere difficulty to foresee the happening is not impossibility to foresee the same. The very measures adopted by said company prove that the possibility of danger was not only foreseeable. But actually foreseen, and was not caso foruito. - Luzon Stevedoring Corporation, knowing and appreciating the perils posed by the swollen stream and its swift current, voluntarily entered into a situation involving obvious danger. The appellant company, whose barges and tugs travel up and down the river everyday, could not safely ignore the danger posed by these allegedly improper constructions that had been erected and, in place, for years. 2. This is up to the sound discretion of the trial Judge. Disposition AFFIRMED.

MCLAUGHLIN V COURT OF APPEALS FERIA; October 10, 1986

NATURE Appeal by certiorari from the decision of the Court of Appeals FACTS - On Feb 28, 1977, petitioner Luisa F. McLaughlin and private respondent Ramon Flores entered into a contract of conditional sale of real property. Paragraph 1 of the deed of conditional sale fixed the total purchase price of P140,000.00 payable as follows: a) P26,550.00 upon the execution of the deed; and b) the balance of P113,450.00 to be paid not later than May 31, 1977. The parties also agreed that the balance shall bear interest at the rate of 1% per month to commence from Dec 1, 1976, until the full purchase price was paid. - On June 19, 1979, petitioner filed a complaint for the rescission of the deed of conditional sale due to the failure of Flores to pay the balance due on May 31, 1977. - On Dec 27, 1979, the parties submitted a Compromise Agreement on the basis of which the court rendered a decision on Jan 22, 1980. In said compromise agreement, Flores acknowledged his indebtedness to petitioner under the deed of conditional sale in the amount of P119,050.71, and the parties agreed that said amount would be payable as follows: a) P50,000.00 upon signing of the agreement; and b) the balance of P69,059.71 in two equal installments on June 30, 1980 and Dec 31, 1980. - As agreed upon, Flores paid P50,000.00 upon the signing of the agreement and

he also paid an "escalation cost" of P25,000.00. - Under paragraph 3 of the Compromise Agreement, private respondent agreed to pay P1,000 pesos monthly rental beginning Dec 5, 1979 until the obligation is duly paid, for the use of the said property - Paragraphs 6 and 7 of the Compromise Agreement further state: -"That the parties are agreed that in the event the defendant (Flores) fails to comply with his obligations herein provided, the plaintiff (Mclaughlin) will be entitled to the issuance of a writ of execution rescinding the Deed of Conditional Sale of Real Property. In such eventuality, defendant (Flores) hereby waives his right to appeal to (from) the Order of Rescission and the Writ of Execution which the Court shall render in accordance with the stipulations herein provided for. -"That in the event of execution all payments made by defendant (private respondent) will be forfeited in favor of the plaintiff (petitioner) as liquidated damages." - On Oct 15, 1980, McLaughlin wrote to private respondent demanding that he pay the balance of P69,059.71 on or before Oct 31, 1980. This demand included not only the installment due on June 30, 1980 but also the installment due on Dec 31, 1980. - On Oct 30, 1980, Flores sent a letter to petitioner signifying his willingness and intention to pay the full balance of P69,059.71 - On Nov 7, 1980, petitioner filed a Motion for Writ of Execution alleging that Flores failed to pay the installment due on June 1980 and that since June 1980 he had failed to pay the monthly rental of P1,000.00. Petitioner prayed that a) the deed of conditional sale of real property be declared rescinded with forfeiture of all payments as liquidated damages; and b) the court order the payment of P1,000.00 back rentals since June 1980 and the eviction of private respondent. - TC granted the motion for writ of execution. Recission will not be permitted for slight breach of contract. ISSUES 1. WON contract should be rescinded 2. WON respondent is liable for the P76,059.71 he attempted to pay to the petitioner but the petitioner did not accept (even though the 30-day period provided by R.A. 6552 has not yet expired) HELD 1. NO - SC agrees with the CA that it would be inequitable to cancel the contract of conditional sale and to have the amount of P101,550.00 (P148,126.97 according to private respondent in his brief) already paid by him under said contract, excluding the monthly rentals paid, forfeited in favor of petitioner, particularly after private respondent had tendered the amount of P76,059.71 in full payment of his obligation. - Private respondent had substantially complied with the terms and conditions of the compromise agreement. - Section 4 of RA No. 6552 which took effect on Sept14, 1972 provides as follows: "In case where less than two years of installments were paid, the seller shall give the buyer a grace period of not less than sixty days from the date the installment became due. If the buyer fails to pay the installments due at the expiration of the grace period, the seller may cancel the contract after thirty days from receipt by the buyer of the notice of the cancellation or the demand for rescission of the contract by a notarial act." - Petitioner demanded payment of the balance of P69,059.71 on or before October 31, 1980, petitioner could cancel the contract after 30 days from receipt by private respondent of the notice of cancellation. Considering petitioner's motion for execution filed on November 7, 1980 as a notice of cancellation, petitioner could cancel the contract of conditional sale after 30 days from receipt by private respondent of said motion. Private respondent's tender of payment of the amount of P76,059.71 together with his motion for reconsideration on November 17, 1980 was, therefore, within the thirty-day period granted by R.A.6552. 2. YES - The tender made by private respondent of a certified bank manager's check payable to petitioner was a valid tender of payment. The certified check covered not only the balance of the purchase price in the amount of P69,059.71, but also the arrears in the rental payments from June to December, 1980 (P7,000.00) or a total of P76,059.71. Section 49, Rule 130 of the Revised Rules of Court provides that: "An offer in writing to pay a particular sum of money or to deliver a written instrument or specific property is, if rejected, equivalent to the actual production and tender of the money, instrument, or property."

- However, although private respondent had made a valid tender of payment which preserved his rights as a vendee in the contract of conditional sale of real property, respondent did not follow it with a consignation or deposit of the sum due with the court. The Manager's Check tendered by private respondent on November 17, 1980 was subsequently cancelled and converted into cash, but the cash was not deposited with the court. - According to Article 1256 (Civil Code), if the creditor to whom tender of payment has been made refuses without just cause to accept it, the debtor shall be released from responsibility by the consignation of the thing or sum due, and that consignation alone shall produce the same effect in the five cases enumerated therein; Article 1257 provides that in order that the consignation of the thing (or sum) due may release the obligor, it must first be announced to the persons interested in the fulfillment of the obligation; and Article 1258 provides that consignation shall be made by depositing the thing (or sum) due at the disposal of the judicial authority and that the interested parties shall also be notified thereof. - Soco vs. Militante: "Tender of payment must be distinguished from consignation. Tender is the antecedent of consignation, that is, an act preparatory to the consignation, which is the principal, and from which are derived the immediate consequences which the debtor desires or seeks to obtain. Tender of payment may be extrajudicial, while consignation is necessarily judicial, and the priority of the first is the attempt to make a private settlement before proceeding to the solemnities of consignation. - Although private respondent had preserved his rights as a vendee in the contract of conditional sale of real property by a timely valid tender of payment of the balance of his obligation which was not accepted by petitioner, he remains liable for the payment of his obligation because of his failure to deposit the amount due with the court. - Inasmuch as petitioner did not accept the aforesaid amount, it was incumbent on private respondent to deposit the same with the court in order to be released from responsibility. Since private respondent did not deposit said amount with the court, his obligation was not paid and he is liable in addition for the payment of the monthly rental of P1,000.00 from January 1, 1981 until said obligation is duly paid, in accordance with paragraph 3 of the Compromise Agreement. Upon full payment of the amount of P76,059.71 and the rentals in arrears, private respondent shall be entitled to a deed of absolute sale in his favor of the real property in question. Disposition. Decision of the CA AFFIRMED w/ the modifications: (a) Petitioner ordered to accept from private respondent the Metrobank Cashier's Check in the amount of P76,059.71 (b) Private respondent ordered to pay petitioner the rentals in arrears of P1,000.00 a month from Jan 1, 1981 until full payment; and (c) Petitioner ordered to execute a deed of absolute sale in favor of private respondent over the real property upon full payment of the amounts . ENRIQUE P. SYQUIA vs. THE HONORABLE COURT OF APPEALS AND EDWARD LITTONFacts: A contract of lease, Exhibit "G", entered into by and between the defendant and plaintiff'spredecessors-in-interest, has been terminated by its express provision appearing in paragraph 1,which states that the lease shall be for a period of nine (9) years commencing on January 1, 1970and ending on January 31, 1979.August 9, 1976, the Litton co-ownership was dissolved bypartition (Exh. "E") and the ownership of the Dutch Inn Building and the lots on which it is builtwas adjudicated to herein private respondent Edward Litton. However, the latter gave notice inwriting (Exh. "F") that as the new owner of said properties, rentals of the same should be remittedto him starting January, 1977. Petitioner signified his conformity (Exh. " F-1 ") to this notice andaccordingly paid his rentals directly private respondent. Then petitioner wrote to respondentmanifesting his willingness to renew the contract of lease upon its expiration on January 31, 1979under such terms as may be agreeable to both of them.private respondent, thru counsel, asked petitioner in writing to vacate the premises on or before the expiration of the lease contract on January 31, 1979, and upon his failure to vacate thepremises after the expiry date of the lease contract, he should pay the amount of P58,685.00 per month as compensation for the use and occupation of the premisesPetitioner objected to the amount as not being fair and reasonable rental, petitioner invoking the huge investment he has put in the Dutch Inn Building from 1970 to 1979 and also thealleged verbal assurance by plaintiff-apellee's predecessor-in-interest of petitioner's priority torenew the lease of the premises in question. Petitioner's refusal to vacate the premises uponwritten demand made by private respondent on February 1, 1979, private respondent filed thecase for ejectment based on the expiration of the Contract of LeaseSYQUIA claims that this case was filed prematurely considering that he is entitled to arenewal of the contract, that one of the inducements which made him enter into a leaseagreement with plaintiff's predecessor-in-interest was the oral assurance of said plaintiff'spredecessor-in-interest that the defendant is entitled to a renewal or a priority to lease thepremises upon the expiration of the contract of leasethe plaintiff is now duty-bound to respect the verbal assurance given by the plaintiff'spredecessor to give him a renewal or priority to a new lease over the property and that defendantshould now be made to exercise his option to renew the lease. In other words, plaintiff should becompelled to abide by the commitment made by his predecessor-in-interest

Issue: Whether or not the defendant is entitled to a renewal of the contract of lease, Exhibit "G ", which on itsface, expired on January 31, 1979. In other words, can the alleged verbal assurances of George Litton Sr.and Gloria Litton del Rio be sufficient basis to vary the written contract and allow the defendant anextension of the lease contract, which, on its surface, already expired on January 31, 1979? Held: However, under 2(e) of Article 1403 of the Civil Code as quoted above, the alleged oralassurance or promise of the representatives of the Litton Finance & Investment Corp, thatdefendant should be given priority or a renewal of Exhibit "G" cannot be enforceable againstplaintiff.there is absolutely no room to readinto Exhibit "G" the alleged extension or renewal or assurance or priority to lease after the contract shall have expired, because the document is initself, complete, and no ambiquities can be ascribed to its terms and neither is there any mistakeor imperfection or failure to express the true intent and agreement of the parties therein, simplybecause the provisions for extension or renewal are not found in or capable of being inferred fromtheThe testimony of the defendant that there was an oral understanding between him andthe representatives of Litton Finance & Investment Corp. to be allowed to extend or renew or be given priority to lease the property at the expiration of the contract of lease on January 31, 1979is belied by his letter to plaintiff dated December 1, 1978, which is inconsistent to what all alongsaid defendant had professedIt is significant from this portion of the letter that the defendant never mentioned hisoption or priority to lease the property. It is the observation of the court that the alleged verbalassurance of George Litton Sr. and Gloria Litton del Rio is only an afterthought of the defendant.It is merely an eleventh hour defense of the defendant when the plaintiff refused to renew thecontractIt is noted that petitioner is among other things a successfull and experiencedbusinessman. Considering his huge investment made on the building, he should have takensteps to protect his investment within the protective mantle of the law by insisting that the allegedverbal assurance be reduced into writing. His failure to do so has considerably weakened hisclaim.Proof of the alleged verbal assurance of a lease renewal cannot be allowed both under the Parol Evidence Rule and the Statute of Frauds for failure to put in writing said allegedstipulation. Upon the other hand We are inclined to consider Syquia as having constructed ingood faith the improvements he introduced in the Dutch Inn Building. His rights to saidimprovements are governed by Art. 1678 of the Civil Code, which provides:Petitioner admits the fact of ownership of the private respondent over the building inquestion. As the owner, it is only logical that he should have the freedom to choose the tenant of the premises under such terms and conditions as may enable him to realize reasonable and fair returns therefrom. Since petitioner stubbornly refused to vacate-ate the premises despiterepeated demands of respondent, he should be obliged to compensate the latter such amount asmay be deemed fair and reasonable under the circumstances.