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Republic of the P

G.R. No. L-27482 S

GRACE PARK ENG vs. MOHAMAD A

DE CASTRO,* J.:

Appeal (prior to the Mohamad Ali Dima Instance of Rizal, B dispositive portion o

WHEREFORE, all rendered declaring of Cassava Flour Equipment, Exh. A, restitution by the p cassava flour an equipment and bea the port of Cotaba charges thereof for the total amount o rate of 6% per ann until full payment defendant the amo payment made to

said machinery an damages and costs

Defendant-Appellan questioned decision return the cassava equipment and 2) Park Engineering C

The records disclo Engineering, Inc., a Contract for the Sal Machinery and Equ

agreed to sell and in cassava flour and s specifically described Lanao Mill Site, withi signing of the contra upon signing of the days from the date machinery and equ P36,750.00 shall b provided in the contra

In view of the fo guaranteed said ma 6 tons of cassava f while Dimaporo und building wherein equipment, laborers the mill, food, fo system (par. 6, Exh

In compliance with amounts of P5,750 leaving a balance o

It appears on reco installation of said m to comply with his contract, so much

provide the neces whatever expenses previous knowledge the latter was short

It took the Corpora install the said m demanded from Di due and for all exp supply of materials on time. Dimaporo balance of P36,750 because of the installation of the stipulated period an conditions as guara

Hence, on October against Dimaporo fo mutual restitution b its favor. Dimapo rescission of the parties, but with pro of freight charges th and with the award

After hearing on til having violated the defendant Dimapo under par. 6 of the installing machine defective and inade point of time, it Rescission of the c should bear his/its New Civil Code whi

In case both par obligation, the liabil tempered by the C

the parties first vio deemed extinguishe

From the judgmen appealed to this C errors committed by into four (4) main is

a) whether he was g

b) whether he w equipment subject m

c) whether he was amount of P19,628.

d) whether he was favor.

Appellant Dimaporo any breach of contr it was appellee Cor in his appellant's br in support of the sa its decision, makes

From the entire evid had failed to comp Exh. A, more partic He was unable t complete the opera and effective water CC, KK LL NN-1). report duly certified flash drier were alre 11, 1954 (Exh. MM that the installatio accordance with the project is due to de defendant's failure delay in the com

equipment seems r

The foregoing is a c is well-settled that f by substantial ev Supreme Court. Th court having had t was testified to an

Hence the rule that w is deemed to have w made by the court be

It is next argued fo erred in ordering th subject matter of maintained that alt order, he has no ob and equipment, mu thereof to the por equipment shipped delivered to appella contract, Exh. A, it did not end with the to the all site; it mus in such a manner t cassava flour per 2 such machinery an be capable of produ no delivery of such

This contention is i of the contract or b that under par. 8 warrants that it will agreed in par. 4, g cassava flour or sta in said paragraph i capacity shall be a the necessary man according to the tria

installation as well a desired amount of under the contrac compliance with his water system."

Even assuming tha appellant's position error in ordering equipment to appe defendant in the low of appellee corpora contract between restitution by the pa

he is not liable for the fundamentally contra paragraph of article 1

Rescission creates were the object of the price with its in only when he who he may be obliged t

Furthermore, when the duty of the cou which they have se as practicable in hi is granted, it has t parts. The party se as to part and resol

The last two issues is liable for the pay of the breach of c issues, applied Arti aforestated, enunci breach of obligatio "Both parties have encumbent upon th

consequently defea obligations under th the evidence show and installed by defective and inade point of time, under delineated. Hence,

Based on these find the dispositive por appellee corporatio latter had spent by to purchase the ne of 6% per annum; appellant the amou payment made by i machinery and equ pronouncement as

But appellant would should be offset b reason of the viola obligation under the to pay interests o amount paid has a first infractor was damages should be

The findings of fa Dimaporo and appe of obligation are ful We have stated, W Therefore, it correc Code to the effect t breach of obligation first infractor, the c each shall bear his court committed no corporation to pay representing partia

machinery and equ decree of rescissio commit any error w aforesaid amount consequence of th bear his/its own da that although app P19,628.93 which advances with whic supplies, however, the rate of 6% per held by the lower conflict with the ab bear his/its own dam

PREMISES CONSI sum of P19,628.93 Grace Park Engine appealed from is pronouncement as SO ORDERED.

Teehankee (Chairm Melencio-Herrera, J

Footnotes

* Mr. Justice de Cas Division under Spec 1 p. 54, Record on

2 p. 8, Record on A

3 pp 48-49, Record

4 Corliss vs. Manila vs. Court of Appeal

28 SCRA 393; Sam vs. Araneta, 24 SCR

5 Cebu Portland Ce SCRA 708; Pascua vs. Cansino, I 1 1 P 6 p. 31, Record on

7 Po Pauco vs. Sigu Magdalena Estate I Verceluz vs. Edano

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Today is Sunday, Ma

Republic of the P

G.R. No. L-45710 O

CENTRAL BANK O DIRECTOR ANTON DEPARTMENT OF his capacity as sta petitioners, vs. TH and SULPICIO M. T

I.B. Regalado, Jr., F

petitioners.

Antonio R. Tupaz fo MAKASIAR, CJ.:

This is a petition for and void the decisio 52253-R dated Febr dated February 15, Agusan, which dism M. Tolentino for inju and damages with p

On April 28, 1965, Is recommendation of application for P80,0 security for the loan mortgage over his 1 Nieves, Agusan, and mortgage was anno approved loan appli loan, repayable in se years, with 12% ann M. Tolentino shall us additional capital to subdivision.

On May 22, 1965, a P80,000.00 loan wa Tolentino and his wi note for P17,000.00 years from the date installments of P3,4 the P80,000.00 loan P4,800.00 was dedu P17,000.00. But this Sulpicio M. Tolentin the Bank that there the P63,000.00 bala

president and treasu the P63,000.00 bala

On August 13, 1965 after finding Island S problems, issued Re

In view of the chroni Savings Bank again unanimous vote, de

1) To prohibit the ba investments [except excluding extension provided that such e review by the Super limitations as may b bank's deficiency as

(p. 46, rec.).

On June 14, 1968, t Savings Bank failed solvency, issued Re Savings Bank from d instructed the Acting of the assets of Islan

On August 1, 1968, payment of the P17, filed an application f estate mortgage cov Tolentino; and the s 22, 1969.

On January 20, 196 the Court of First Ins performance or resc injunction, alleging t

deliver the P63,000. entitled to specific p Bank to deliver the P from April 28, 1965, rescind the real esta

On January 21, 196 P5,000.00 surety bo enjoining the Island foreclosure of the m

On January 29, 196 intervention praying M. Tolentino and the by the Central Bank Banks (pp. 65-76, re

On February 15, 197 rendered its decision Sulpicio M. Tolentin the amount of PI 7 0 due thereon, and lift may proceed with th

On February 11, 197 Sulpicio M. Tolentin decision by affirming petition for specific p Savings Bank can n nor collect the P17,0

Hence, this instant p The issues are:

1. Can the action of performance prospe

2. Is Sulpicio M. Tol covered by the prom

3. If Sulpicio M. Tole subsists, can his rea said amount?

When Island Saving into an P80,000.00 l undertook reciproca obligation or promis of the other (Penaco Quirino vs, Pelarca has performed or is contract, the other p and willing to perform Code). The promise consideration for the furnish the P80,000. executed a real esta his willingness to pa the obligation of Isla P80,000.00 loan acc the entire loan starte period of 3 years or Bank issued Resolu prohibited Island Sa Such prohibition ma Bank to furnish the P loan. The power of t banks for the protec 29 of R.A. No. 265, validity of which is n

The Board Resolutio cannot interrupt the complying with its ob balance because sa from making new loa prohibit island Savin loan agreements pre pecuniary inability to the obligation of the

defense to a decree vs. Afzelius and Afz fact of insolvency of fulfillment of an oblig the contract by him

The fact that Sulpici the refund of the pre P4,800.00 for the su month period canno the P63,000.00 bala asking the advance P80,000.00 loan, wa P17,000.00 out of th person cannot be le debt. Thus, the rece deducted interest wa exist independently the P80,000.00 loan much less neutralize

The alleged discove valuation of the loan complying with its re P80,000.00 loan. 'Th officials and employ prudence in the disc Caloocan, Inc. vs. C obligation of the ban they approve the loa investigate the exist being offered as a lo where collaterals for grossly over-valued responsibility. The m employees on their loan collateral being performance of this employees totally re as to the valuation o

the risk in case the c representation made bank's responsibility Furthermore, the low Tolentino, had enjoi the alleged over-val same in their pleadin The lower court's ac Section 2, Rule 9, w not pleaded either in deemed waived." Pe issue before the Sup

Since Island Saving reciprocal obligation Tolentino, under Art between specific pe either case. But sinc from doing further b 967, WE cannot gra M, Tolentino.

Rescission is the on however, that rescis the P80,000.00 loan insofar as such amo the bank failed to giv release of P17,000.0 and executed a prom deemed to have com furnish a P17,000.00 Sulpicio M. Tolentin P17,000.00 loan wh overdue amortizatio party in default, hen of the Civil Code). If note, it shall belong Savings Bank. If Tol setting the date for p would be entitled to

because he cannot for him to perform h

Since both parties w respective reciproca failed to comply with Sulpicio M. Tolentin his P17,000.00 debt liable for damages.

Article 1192 of the C parties have commit the liability of the firs the courts. WE rule damages in not furn liability of Sulpicio M penalties and surcha P17,000.00 debt. Th interest on his PI 7,0 offsetting the liabiliti Tolentino derived so is just that he should

WE hold, however, t Tolentino cannot be 17,000.00 debt.

The consideration o mortgage is the sam de Oro vs. Bayuga, consideration of his Thus, in the accesso consideration of the existence of a valid, 2086, in relation to A

The fact that when S estate mortgage, no there was no debt y made any release o

mortgage void for la any consideration sh the contract of real m 122 [1983]). lt may e when the considerat mortgage can take e created as a binding 176 N.W. p. 583, cit 2, pp. 5-6). And, wh the mortgage becom failure (Dow. et al. v 59, 1974 ed. CJS, p owing to the holder named in the mortga more than the actua Peterson, Vol. 19, F Mortgage, Vol. 1, P.

Since Island Saving balance of the P8O, Sulpicio M. Tolentin P63,000.00 is 78.75 mortgage covering 1 of 78.75 hectares. T 21.25 hectares subs 21.25 hectares is m debt.

The rule of indivisibi by Article 2089 of th this case.

Article 2089 provide

A pledge or mortgag be divided among th creditor.

Therefore, the debto can not ask for the p

or mortgage as long

Neither can the cred the debt return the p prejudice of other he

The rule of indivisibi 2089 above-quoted creditor which does indivisibility of a mor

WHEREFORE, THE APPEALS DATED F MODIFIED, AND

1. SULPICIO M. TO PAY IN FAVOR OF P17.000.00, PLUS P INTEREST PER AN MAY 22, 1965 TO A ON THE TOTAL AM 1985 UNTIL PAID;

2. IN CASE SULPIC REAL ESTATE MOR SHALL BE FORECL INDEBTEDNESS; A

3. THE REAL ESTA HECTARES IS HER AND IS HEREBY O SULPICIO M. TOLE

NO COSTS. SO OR

Concepcion, Jr., Esc

Aquino (Chairman) a

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