RUTTERS VS ESTEBAN #69

Issue: W/N the contention of the appellant is correct?

Facts: In 1941, plaintiff sold to defendant two parcels of land in which

half of the purchase price were to be paid in two equal installments.
Defendant failed to pay the two installments as agreed upon, and so on
1949, plaintiff filed and action to recover the balance and interest due
thereon. Defendant contended that the contract is a pre-war obligation
which under R.A. No. 342, the payment of his obligation cannot be
enforced until after the lapse of eight years from the settlement of his
claim by the Philippine War Damage Commission.

Held: No. The article cited by the appellant cannot be applied to the
case at bar where the parties entered into a compromise agreement
ending a controversy and authorizing the court to fix a reasonable time
within which the appellant should pay its debt to the appellee, if they fail
to agree upon a date for payment and submit it to the court. The article
cited by appellant applies where the parties to a contract themselves have
fixed a period.

Issue: W/N the 8-year period granted by law to pre-war debtors

reasonable under the present circumstances?

CONCEPCION VS PEOPLE # 71

Held: These obligations had been pending since 1945 as a result of the
issuance of E.O. No. 25 and 32 and the enactment of R.A. No. 342 and
would continue to be enforceable during the 8-year period granted to prewar debtors which means that the debtors have to wait 12 years before
they could effect a liquidation of their investment. This period is seems to
be unreasonable if not oppressive.

Facts: Appellant, a civil engineer, gratuitously offered his services to

direct and administer the construction of the house of his niece. For this
purpose, he actually received from the complainant the amount of P793.54
for the purchase of the materials and the payment of wages of laborers. Of
this amount, he spent only P39.55 for materials and nothing for labor.
Complainant charged the appellant with the crime of estafa.
Issue: W/N the appellant is liable to the crime charged against him?

ORIT VS BALDROGAN #70

Facts: In a collection case, the parties entered into a compromise
agreement wherein they have mutually agreed to submit to the court a
fixed date when the defendant should pay the plaintiff his obligation and
that if they fail to do so, they agreed to empower the court to fix the time
when the defendant should pay. Thereafter, parties failed to submit to the
court the date of payment, thus, plaintiff filed a motion to the court to fix
the time of payment. The court ordered the defendant to pay within 30
days from notice of judgment. Appellant invoked article 1196 of the New
Civil Code and argued that the period fixed by the court redound to the
benefit only of the creditor and not mutually to the creditor and debtor.

Held: It appears that the parties did not fix a definite period within
which the appellant was to complete the construction of the house,
although they intended some period. In keeping with article 1128 of the
Civil Code, it has been held that if the parties intended a period but did
not specify it, the fulfillment of the obligation until after the demand from
the obligoror until after the court have fixed the period for compliance
therewith, such period has arrived. But even supposing that there was
delay in the construction and in the payment for the material and labor,
this fact does not per se constitute misappropriation and conversion.

ARANETA VS PHILIPPINE SUGAR #72

Facts: In the contract of sale executed between the parties, the buyer
agreed to build on the property the Sto. Domingo Church and Convent,
and the seller agreed to construct streets on all four sides of the property.
The buyer, herein respondent, finished the construction of the Church and
the Convent, the seller, herein petitioner, is unable to finish the
construction of the street because a certain third party refused to vacate a
part thereof. Hence, respondent filed an action to compel the petitioner to
comply with their obligation. Petitioner put up the defense that the action
was premature because their obligation was without a definite period
which needs to be fixed first by the court before a complaint for specific
performance will prosper.
Issue: W/N the obligations of the petitioner under the contract are with a
period.
Held: Article 1197 of the Civil Code involves two steps. First, the court
must determine that the obligation does not fix a period but from the
nature and circumstances it can be inferred that a period was intended.
Second, the court must decide what period was probably contemplated by
the parties.
In this connection, it is to be noted that the contract shows that the parties
were fully aware that the land was occupied by squatters, and the parties
knows that they must resort to legal process in evicting the squatters.
Thus, the parties must have intended to defer the performance of the
obligations under the contract until the squatters were duly evicted.
SALVANTI VS CRUZ # 73
Facts: In a judgment entered in 1936, it was ordered that upon payment
of P725 by the plaintiffs to the defendant Bernardina Ubi Cruz, the latter
deliver the land in question to the plaintiff. The judgment was not
executed during the period of 5 years after the entry thereof. Almost eight

years later, the heirs of plaintiff filed an action against the defendant based
on the said judgment and deposited with the clerk of court the sum of
P725 in Japanese war notes. The defendant refused to accept the tender of
payment based on the judgment of 1936. The lower court ordered the
defendant to deliver the land in question to the plaintiffs without the latter
paying anything.
Issue:
W/N plaintiff can legally compel the defendant to accept the
tender of payment based on the 1936 judgment.
Held: The adoption of the theory which holds that, in cases like the
present, the judgment of the court has to fix a reasonable period within
which the vendor under a pacto de retro must pay the redemption price or
redeem the property sold, would lead to the legal absurdity that such
vendor may surely extend the period of redemption at his option and
against the will of the vendee, by filing, before the expiration of the period
of redemption agreed upon by the parties or fixed by law, and action to
compel the vendee to allow the vendor a retro to redeem the property
sold, because the court has to grant the vendor a retro a reasonable time
within which the vendor may redeem or pay the purchase price to vendee.
In this case, the original judgment did not fix any period within which the
plaintiff had the right to repurchase the property, and in the second
judgment, the lower court did not fix a period, for it could not amend the
original judgment.

CALERO VS CARRION #74

Facts: On his amended complaint, plaintiff asked the court to fix the
period for the fulfillment of defendants obligation. Defendant, on the
other hand, contended that the plaintiffs action has already prescribed
under the law and the applicable authorities. The trial court dismissed the
action in favor of defendant. On appeal, plaintiff contended that their of

action to have the period judicially determined did not begin to run until
the defendant had been formally demanded and they refused to sell the
property.
Issue:

W/N the contention of the plaintiff is correct?

Held: No. Before the period is fixed, the defendants obligation to sell is
suspended and they, therefore, cannot be compelled to act. In this case,
plaintiffs cause of action should have been to have the court fix the period
and after the expiration of that period, to compel the performance of the
obligation to sell. And this right to have the period judicially fixed is born
from the date of the agreement itself which contains the undetermined
period. Since the agreement was executed in 1937 and the complaint to
have the period fixed was filed in 1956 or after almost 20 years, therefore,
plaintiffs action was barred by statute of limitations.

SCHENKER VS GEMPERLE #75

Facts: Plaintiff and defendant agreed to organize a Philippine
corporation and to divide the capital stock equally. However, in the article
of incorporation only 24% of the capital stock were placed in the name of
the plaintiff and the remaining 76% in the name of the defendant due to a
local law requiring 75% of the capital to be owned by Filipino, otherwise,
the flag law will be applied. Defendant, however, assured that plaintiff
would give the latter his equal share. Plaintiff then paid for his subscribed
prescription. Later on, however, defendant refused to live up to their
agreement, thus, plaintiff filed an action to cause to be transferred to his
name 26% of the capital stock of the corporation. Defendant, on the other
hand, contended that it was not alleged in the complaint that his
obligation is already due. It not having fixed a period for its compliance,
there has been no default thereof.
Issue: W/N defendant is already in default?

Held: Yes. The obligation in question is pure because its performance

does not depend upon a future or uncertain event or upon a past unknown
to the parties, and as such, is demandable at once. The immediate
payment by plaintiff of his subscription, after the organization of the
corporation, can only mean that the obligation should be immediately
fulfilled giving the defendant only such time as might reasonably be
necessary for its actual fulfillment.

DAGUHOY VS PONCE #76

Facts: Defendants Domingo and Buhay Ponce were chairman-manager
and secretary-treeasurer, respectively, of plaintiff corporation. Rita Ponce,
wife of Domingo, executed in favor of plaintiff a deed of mortgage over a
parcel of the land to secure the payment of a loan granted by plaintiff
payable within six years. Rita and Domingo presented the deed for
registration but the register of deeds noted defects and deficiencies in the
papers and advised them to cure the defects. Instead of complying with
the suggestion, the two withdrew the deeds and then mortgage it in favor
of another corporation to secure a loan. Later on, upon learning of this
fact, the plaintiff corporation filed an action to collect the amount of the
loan.
Issue: W/N the obligation became due despite the non-expiration of the
term stipulated in the contract.
Held: Yes. Although the original loan was payable in six years and so did
not become due and payable until the expiration of such term, the court
held that under article 1198 of the New Civil Code, the debtor lost the
benefit of the period by reason of their failure to give security in the form
of the deeds of mortgage and register the same, including the defendants
act in withdrawing said deeds and then mortgaging the same property to
another corporation; and so the obligation became pure and without any

condition and consequently, the loan become due and immediately

demandable.

judgment contending that it be allowed to rebuild the house burnt in

pursuance of the conditions of the policies which provides that the
company, at its option, rebuild the house burnt instead of paying the
amount of the loss of damages.

TIMBOL VS MARTIN #77

Issue:

Facts: Plaintiff sued the defendant to recover the value of eight

promissory notes. Plaintiff succeeded in obtaining a writ of preliminary
attachment on the properties of the defendant. Invoking the moratorium
orders, defendant moved for the dismissal of the complaint. Plaintiff on
the other hand, argued that the period for the performance of defendants
obligation in the promissory notes, or the terms thereof were superseded
by the Moratorium Law, which in itself is a term. This term, plaintiff
contends, has been lost to the defendants, in accordance with article 1129
of the Civil Code, because they become insolvent.

Held: Yes, that is to say, that the company may either pay the insured
value of the house or rebuild it. It must be noted that in alternative
obligations, the debtor must notify the creditor of his election, stating
which of two prestations he is disposed to fulfill, in accordance with article
1133 of the Civil Code. The object of this notice is to give the creditor
opportunity to express his consent, or impugn the election made by the
debtor, and only after said notice shall the election take legal effect when
consented by the creditor. In the instant case, there is formal notice given
by the defendant of its election.

Issue: W/N the term in the promissory note under the Moratorium Law
for the performance of the obligation was lost due to insolvency of
defendants?

PAROT VS GEMORA #80

Held: No. first, article 1129 contemplates a period fixed by the

contracting parties, while the Moratorium Law was not so fixed. Second,
under article 1129, the insolvency must be one occurring after the term
was fixed, here, there is no proof that defendants become insolvent after
the promulgation of the moratorium orders. Third, it would be inconsistent
with the reason behind the moratorium law if the defendants be declared
automatically deprived of the benefits of the law due to his financial
difficulties.

Facts: The promissory note, issued by Thomasa Gemora as one of comakers, came to the hands of the plaintiff by proper indorsement and
delivery. Plaintiff, as indorsee, brought an action against the defendant as
one of the co-makers. The lower court rendered judgment in favor of the
plaintiff. On appeal, contended that the Civil Code provides that where
two or more persons are obliged in a single contract, they shall be liable
only pro rata, unless the contract by express terms makes them liable for
the full amount of the obligation.

ONG GUAN CAN VS CENTURY #81

Issue: W/N the phrase juntos separadamente creates a solidary liability?

Facts: The lower court rendered a judgment in favor of the plaintiff,

sentencing the defendant company to pay the plaintiff the value of certain
fire insurance policies. The defendant company appealed from this

Held: Yes. The phrase juntos separadamente used in the notes is an

express statement, making each of the person who signed it individually

W/N the conditions of the policy is an alternative one.

liable for the payment of the full amount of the obligation contained
therein.

REYES VS ZABALLERO #82

Facts: During the Japanese occupation, the creditor of a pre-war
obligation, herein appellant, reluctantly received Japanese military notes
tendered in full payment of defendants full credit. After liberation, he
sued for the recovery of the debt contending that his acceptance of the
money was invalidated by duress. He alleged that after he received the
payment, he executed an affidavit in secret without the knowledge of the
debtor stating therein that he was compelled to accept the payment due
to his fear that the Japanese would take it wrongly if he dont accept their
note even though it was extremely depreciated.
Issue:

W/N the tender of payment was valid?

Held: Yes. What was important was that appellant accepted the money,
and executed the release. What he did afterwards without the knowledge
of the debtor is entirely of no consequence. Mere reluctance to accept the
money does not detract from the voluntariness of ones act. Legally
speaking, he acts as voluntarily and freely when he acts wholly against his
better sense and judgment as when he acts in conformity with them. Also,
his alleged option to select US currency can no longer be entertained as his
voluntary acceptance of the payment was in effect a waiver of the option.

MOLLERS VS SARILE #89

Facts: The suit arose from two contracts by and between plaintiffs
assignor Charles Choy Inc. and the individual defendants. The defendants
had purchased the property from Surplus Property Commission and had

used the advances of the Charles Choy to pay therefor. The buyer in turn
obtained its funds from the plaintiff herein. The defendant knew that Choy
and the plaintiff were partners in the transaction and dealt with either or
both as partnership. Charles Choy assigned to plaintiff its interest and the
plaintiff filed a suit claiming that the defendants breached the contract by
failure t deliver metal scrap against its advances. Plaintiff claimed that the
debtors were solidarily liable.
Issue:

W/N the debtors were solidarily liable?

Held: No, because the suit is not on tort but upon contract, where
solidarity is not presumed; and, in the absence of express stipulation or
specific law to the contrary, the intentional non-performance of a joint
contractual obligation does not convert the latter into a solidary one. Such
is the rule even if the obligation is indivisible. The obligation of each joint
debtor being separate, the damages due to its breach must be borne by
him alone.

REYES VS MARTINEZ #83

Facts: Appellant brought and action against the defendant upon a
promissory note. The lower court ruled in favor of the defendant on the
ground that the said promissory note had been executed and delivered in
payment of the money lost by defendant to the plaintiff in a game known
as burro, a game of chance which is prohibited under the law. On appeal,
appellant contended that the lower court erred in declaring burro as a
game of chance, and that debt is not enforceable, created by virtue of said
game.
Issue:

W/N plaintiff may recover from the defendant?

Held: Under article 1798 of the Civil Code, the law does not permit any
action to claim what is won in a game of chance; but the person who loses

cannot recover what he may have voluntarily paid unless there has been
fraud, or should he be minor, or incapacitated to adminster his property. In
this case, the game burro is a common parlor game among Filipinos and
is therefore not prohibited. It is not a game of chance as it does not
depend exclusively upon chance but upon the skill of the player. Therefore,
a person who executes and deliver a promissory note for money lost in the
game of burro is liable on such contract unless there is fraud, or person
is a minor or incapacitated to administer his property.