OBLIGATIONS and CONTRACTS (ATTY. SIEGFRED B.

MISON)
2nd Semester, 2012-2013
RELEVANT CASES
CONTRACTS:
General Provisions: (Articles 1305 to 1317)
1. A contract is a meeting of minds: (Jardine Davies vs. CA, 333 SCRA
684)
2. Freedom To Stipulate: (Azcuna, Jr. vs. CA, 255 S 215; Manila Bay
Club vs. CA, 245 S 715; De Leon vs. CA, 186 S 345; Batarra vs.
Marcos, 7 P 156; Cui vs. Arellano University, 2 S 205; Ferrazzini vs.
GSell, 34 P 697; Omico Mining and Industrial Corp vs. Vallejos, 63
S 301)
3. Innominate contracts: (Perez vs. Pomar, 2 P
Construction vs. Cathay Pacific Steel, June 29, 2010)

682;

Asian

4. Mutuality of Contracts: (UCPB vs. Beluso, 530 S 567; Joaquin vs.

Mitsumine, 34 P 858; Garcia vs. Legarda, 21 S 555)
5. Relativity of Contracts: (Integrated Packing vs. CA, 333 S 170; DKC
Holdings vs. CA, 329 S 666)
6. Stipulation Pour Autrui: (Marmont Hotel vs. CA, 168 S 373; Coquia
vs. Fieldmens Insurance, 26 S 178; Mandarin Villa vs. CA, 257 S
538; Everett Steamship vs. CA, 297 S 496; Kauffman vs. PNB, 42 P
182; Associated Bank vs. CA, 291 S 513)
7. Contractual Interference: (Gilchrist vs. Cuddy 29 Phil 542, So Ping
Bun vs. CA 314 S 751; Lagon vs. CA, 453 S 616)

8. Contracts are perfected by mere consent: (Luxuria Homes vs. CA,

302 S 315)
9. Real contracts:
10. Unenforceable contracts: (Rallos vs. Felix Go Chan, 81 S 251;
United Namarco Distributors vs. NAMARCO, 114 P 802)
Essential Requisites: (Articles 1318 to 1355)
(1) Consent of the contracting parties (Clarin vs. Rulona, 127 S 512)
(2) Object certain which is the subject matter of the contract
(3) Cause of the obligation.
SECTION 1. Consent
1. Offer: (Korean Air vs. Yuson, June 26, 2010; Rosenstock vs. Burke,
46 P 217)
2. Acceptance:
(1) Absolute vs. Qualified: (Batagan v. Cojuangco, 78 P 481;
Zayco vs. Serra 44 P 326)
(2) In person; via agent; by letter or telegram: (Laudico vs.
Arias, 43 P 270)
(3) Express or implied:
(4) Effects of death, civil interdiction, insanity, or insolvency of
either party before acceptance: (Art 40-41, RPC)
3. Option Contract: (Sanchez vs. Rigos, 45 S 368; Art 1482, NCC)
4. Business advertisements:
(1)
(2)

Mere invitations to make an offer:

Advertisements for bidders:

5. Incapacitated persons to give consent to a contract: (Art 1491,

NCC; Art 87, FC; Art 37-38, NCC)

(1)
(2)
(3)

Minors; exceptions: (Bambalan vs. Maramba, 51 P 417,

Mercado, et al. vs. Espiritu, 37 P 215; Braganza vs. de Ville
Abrille, 105 P 456)
Insane persons and deaf-mutes who do not know how to
write:
Drunk or under hypnotic spell:

6. Vice of Consent: (Hernandez vs. Hernandez, March 9, 2011)

(1) Mistake: (Gomez vs. Linton, 45 P 653; Atilano vs. Atilano,
28 P 231; Teran vs. Villanueva, 56 P 677)
a. Illiterates: (Tan vs Mandap 429 S 712; Dela Cruz vs.
Dela Cruz 419 S 648)
b. Adhesion: (Calilap-Asmeron vs. DBP, November 23,
2011)
(2) Violence:
(3) Intimidation:
(4) Undue influence: (Martinez vs. HSBC, 15 P 252, Baez vs.
CA, 59 S 15; Vales vs. Villa, 35 P 769)
(5) Fraud: (Strong vs. Gutierrez, 6 P 680; Woodhouse vs. Halili
93 P 526; Cacho vs. Bonifacio 476 S 869; Araneta vs. De
Paterno 91 P 786; Tuason vs. Marquez, 45 P 381; Songco
vs. Sellner, 37 P 254; Azarraga vs. Gay 52 P 599)
7. Usual exaggerations in trade:
8. Mere expression of an opinion: (Songco vs. Sellner, 37 P 254)
9. Misrepresentation:
(1) By a third person: (Hill vs. Veloso, 31 P 160)
(2) In good faith: (Asiasin vs. Jalandoni, 45 P 296)
10. Simulation of a contract:
(1) Absolute vs. relative: (Rodriguez vs. Rodriguez, 127 P 294;
Gonzales vs. Trinidad, 67 P 682; Borromero vs. Borromeo,
98 P 432; Bravo Guerrero vs. Bravo, 465 S 244)

SECTION 2. - Object of Contracts

(1) Commerce of Men: (Blas vs. Santos, 1 S 899; Uson vs. Del
Rosario, 92 P 530)
(2) Impossible Things or Services: (Castro vs. Longa, 89 P 581)
SECTION 3. - Cause of Contracts
(1) Presumption: (Raet vs. CA, 295 S 677; PBC vs. Lui She, 21 S 52;
Saquid vs. Security Finance Inc., 477 S 256)
(2) Kinds:
(3) Cause vs. Motive: (Liguez vs. CA, 102 P 577; Gonzales vs.
Trinidad, 67 P 682)
(4) Legality: (Velez vs. Ramas, 40 P 787, Liam Law vs. Olympic
Sawmill, 129 S 449)
(5) Lesion: (Art 1381, NCC)
CHAPTER 3
FORM OF CONTRACTS
(1) Forms
a. No Form: (Tan vs. Lum, 296 S 455; San Lorenzo Devt Corp.
vs. CA, 449 S 99)
b. Exception: (Art 748, 749, 1581, 1874, 2134, 1956, 1773,
1403(2))
c. Prescriptibility: (Vdc de Espiritu vs. CFI of Canta, 47 S 354)
(2) Form for Convenience: (Shaffer vs. Palma, 131 P 22, Hawaiian
Phil. Co. vs. Hernaez, 45 P 746; Dauden vs. delos Angeles, 137 P
900)
CHAPTER 4
REFORMATION OF INSTRUMENTS (Articles 1359 to 1369)
(1) Basis: (San Miguel Brewery vs. Law Union and Rock, 40 P 674)
(2) Definition: (Sarming vs. Dy, 383 S 131)
(3) Requisites: (Dizon vs. Gaborro, 83 S 688, City of Cabanatuan vs.
Lazaro, 39 S 653; Emilio vs. Rapal, March 30, 2010)

(4) When Available: (Jayme vs. Alampay, 62 S 131, Ong Chua vs.
Carr, 53 P 975)
CHAPTER 5
INTERPRETATION OF CONTRACTS (Articles 1370 to 1379)
Rule 130, Sec. 9, 10, 12, 14 Revised Rules of Civil Procedure
General Rule: (Heirs of Amparo del Rosario vs. Santos, 108 S 43;
Labasan vs. Lacuesta, 86 S 16; Prisma Construction vs. Pantaleon,
March 9, 2010; Martin vs. DBS Bank, June 16, 2010)
(1) Intention of the Parties: (Ramos vs. Heirs of Ramos Sr., 381 S
594; Carceller vs. CA, 302 S 719; Almeda vs. Bathala Marketing,
542 S 470)
(2) Interpretation as a Whole: (Bundalian vs. CA, 129 S 645)
(3) Custom or Usage: (Art. 12 NCC, Sec. 2-3, Rule 129 New Rules of
Evidence; Sec. 10-19, Rules of Court; Andreas vs. BPI, 47 P 795)
(4) Obscure words: (Ildefonso vs. Sibal, 106 P 287; Ong Yong vs.
Tiu, 375 S 614; Govt of the Phil vs. Derham Bros, 36 P 960)
CHAPTER 6
RESCISSIBLE CONTRACTS (Articles 1380 to 1389)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)

Rescission vs. Resolution: (Article 1191 and 1592)

Requisites: (Cannu vs. CA, 459 S 80)
Fraud of Creditors: (CBC vs. CA, 327 S 378; Oria vs. McMicking
21 P 243)
Accion Pauliana: (Article 1177)
Alienation of Things under Litigation: (Contreras vs. CBC, 76 P
709; Rule 13, Section 14 RRC)
Others: (Articles 1098, 1189, 1526, 1534, 1539, 1542, 1556,
1560, 1567, 1659; Rosencor Devt Corp. vs. Inquing, 354 S 119)
Subsidiary Action: (Suria vs. IAC, 151 S 661; Regalado vs.
Luchsinger, Regalado vs. Luchsinger, 5 P 625; Goquiolay vs.
Sycip, 9 S 663)
Restriction: (Goldenrod vs. CA, 299 S 141)

(9)

Presumption of Fraud: (Cabaliw vs. Sadorra, 64 S 310; Alpuerto

vs. Perez Pastor, 38 P 785; Ayles vs. Reyes, 18 P 243; Lee vs
Bangkok Bank, Feb 9, 2011)

CHAPTER 7
VOIDABLE CONTRACTS (Articles 1390 to 1402)
(1) Incapacity and Vice of Consent
(2) Ratification: (Uy Soo Lim vs. Tan Unchuan, 38 P 552; De Luna vs
Linatoc, 74 P 15; Rosales vs. Reyes, 25 P 495)
(3) Prescription
(4) Restitution: (Philippine Trust Co. vs. Roldan, 99 P 393)
CHAPTER 8
UNENFORCEABLE CONTRACTS (n) (Articles 1403 to 1408)
(1) Different Kinds:
(a) No authority: (Bumanlag vs. Alzate, 144 S 480; Rallos vs
Felix Go Chan, 81 S 259)
(b) Statute of Frauds: (Almirol vs. Monserrat, 48 P 67;
Hernandez vs. Andal, 78 P 196; Robles vs. Lizarraga, 42 P
584; Reiss vs. Memije, 15 P 350; Syquia vs. CA, 151 S 507)
(c) Both parties incorporated
(2) Ratification: (Averia vs. Averia, 436 S 459; Abrenica vs. Gonda,
Abrenica vs. Gonda, 34 P 739)
(3) Attack by Third Persons: (Ayson vs. CA, 97 P 965)
CHAPTER 9
VOID AND INEXISTENT CONTRACTS
(1) Kinds: (Ariaga vda. de Gurrea vs. Suplico, 488 S 332; Tongoy vs.
CA, 123 S 99; Rongavilla vs. CA, 294 S 289; Calimlim Canullas
vs. Fortun 129 S 675; Mapalo vs. Mapalo, 123 P 979; Manzano
vs. Garcia, Nov. 28, 2011)

(2) Imprescriptibility: (Ras vs. Sua, 134 P 131; Angeles vs. CA, 102 P
1006; Terre vs. Terre, 211 S 7; Atienza vs. Brillantes, 243 S 32;
MWSS vs. CA, 297 S 287)
(3) In pari delicto: (Batarra vs. Marcos, 7 P 156; Santos vs. Roman
Catholic Church, 94 P 405)
(a) Exceptions: (Articles 1413 1419)
Forms: (Articles 1356 to 1358)
Reformation of Instruments: (Articles 1359 to 1369)
Emilio vs. Rapal, March 30, 2010
Interpretation of Contracts: (Articles 1370 to 1379)
Prisma Construction vs. Pantaleon, March 9, 2010;
Martin vs. DBS Bank, June 16, 2010
Rescissible Contracts: (Articles 1380 to 1389)
Voidable Contracts: (Articles 1390 to 1402)
Unenforceable Contracts: (Articles 1403 to 1408)
Void Contracts: (Articles 1409 to 1422)
Ordua vs. Fuentebella, June 29, 2010