Avillon, Balagtas, Combate, Garcia, Lumbre, Regado, Villar, Zabala

Nᴀᴛᴜʀᴀʟ Oʙʟɪɢᴀᴛɪᴏɴ​S
[ART. 1423]
Obligations are civil or natural. Civil obligations give a right of action to compel their
performance. Natural obligations, not being based on positive law but on equity and natural
law, do not grant a right of action to enforce their performance, but after voluntary fulfillment
by the obligor, they authorize the retention of what has been delivered or rendered by reason
thereof. Some natural obligations are set forth in the following articles.

Purpose of Inclusion
Natural obligations cannot be enforced by a civil action, however they have certain
juridical consequences. Their performance is compelled by the principles of equality,
morality and natural justice, which are at the same time the abiding foundations of all
positive law. A broad policy justifies a legal principle that would encourage persons to fulfill
their moral obligations.

Civil Obligations and Natural Obligations Compared

Civil Obligation Natural Obligation

Arises from law, contracts, quasi-contracts, Based on equity and natural law
delicts, and quasi-delicts

Gives a right of action in courts of justice to No right of action to enforce its performance
compel their fulfillment or performance

Enforceability
General Rule - ​Natural obligations are not cognizable by the courts.
Exception - ​If there has been voluntary fulfillment (i.e. when obligor knew that the obligation
cannot legally be enforced), the court may order the retention of what has been delivered.
→ Eg. In case of payment by mistake, the obligor, believing the obligation to be a civil
one, may recover the payment on the principle of ​solutio indebiti​.

Jurisprudence
Rural Bank of Paranaque, Inc. vs. Remolado
The mortgagor D failed to repurchase the mortgaged property before October 31,
1973. However, after such date, D delivered the repurchase price. Mortgagee B thereafter
sold the property to another. B is not bound to reconvey the property in favor of D since she
had no cause of action because she failed to repurchase the property on October 31, 1973.
As a rule, equity follows the law. There may be a moral obligation, but if there is no
enforceable legal duty, the action must fail.

[ART. 1424]
 When a right to sue upon a civil obligation has lapsed by extinctive prescription, the obligor
who voluntarily performs the contract cannot recover what he has delivered or the value of
the service he has rendered.

Prescription
If a debtor, who knows that extinctive prescription has set in, voluntarily pays a debt,
he can no longer demand the recovery of such debt by invoking prescription.

[ART. 1425]
When without the knowledge or against the will of the debtor, a third person pays a debt
which the obligor is not legally bound to pay because the action thereon has prescribed, but
the debtor later voluntarily reimburses the third person, the obligor cannot recover what he
has paid.

Payment by a Third Person

General Rule ​- If a third person pays the prescribed debt of the debtor without his
knowledge or against his will, the latter is not legally bound to pay him.
Exception​ - If the debtor voluntarily reimburses the third person, the former cannot recover
what he has paid.

[ART. 1426]
When a minor between eighteen and twenty one years of age who has entered into a
contract without the consent of the parent or guardian, after the annulment of the contract
voluntarily returns the whole thing or price received, notwithstanding the fact that he has not
been benefited thereby, there is no right to demand the thing or price thus returned.

No Obligation to Return
General Rule​ - When a contract is annulled, a minor is not obliged to make any restitution.
Except​ - The minor shall return the thing or price received insofar as he has been benefited
by the same.
→However, if he voluntarily returns the thing or price received, he cannot recover
what he has returned.

Requisites for the Application of the Rule

1. The party is a minor between 18 and 21 years old
2. The minor enters into a contract without the consent of his parent or guardian
3. The contract is annulled

[ART. 1427]
When a minor between eighteen and twenty-one years of age, who has entered into a
contract without the consent of the parent or guardian, voluntarily pays a sum of money or
delivers a fungible thing in fulfillment of the obligation, there shall be no right to recover the
same from the obligee who has spent or consumed it in good faith.

Mutual Restitution

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General Rule ​- By the decree of annulment, the parties are obliged to make mutual
restitution.
Exception​ - If obligee spent or consumed in good faith the money or consumable thing
voluntarily paid or delivered by the minor, the former is not bound to make restitution.

Application
1. This article also applies to cases involving non-consumables when the same are lost
without the fault of the debtor.
2. It also applies to cases of alienation by the obligee to a third person who did not act
in bad faith.

[ART. 1428]
When, after an action to enforce a civil obligation has failed, the defendant voluntarily
performs the obligation, he cannot demand the return of what he has delivered or the
payment of the value of the service he has rendered.

Performance after Losing the Case

Notwithstanding the fact that the creditor lost the case to enforce a civil obligation against the
debtor, if the latter voluntarily performs his obligation, he cannot demand the return of what
he has delivered.

Moral Duty
Debtor is deemed to have considered it his moral duty to fulfill his obligation.

[ART. 1429]
When a testate or intestate heir voluntarily pays a debt of the decedent exceeding the value
of the property which he received by will or by the law of intestacy from the estate of the
deceased, the payment is valid and cannot be rescinded by the payer.

Liability of Heirs
General Rule​ - The heir is not personally liable beyond the value of the property he received
from the decedent.
Exception​ - If the heir voluntarily pays the difference, the payment is valid and cannot be
rescinded.

Moral Duty
An heir has a moral duty to perform or pay obligations legally contracted by his dead
relatives.

[ART. 1430]
When a will is declared void because it has not been executed in accordance with the
formalities required by law, but one of the intestate heirs, after the settlement of the debts of
the deceased, pays a legacy in compliance with a clause in the defective will, the payment is
effective and irrevocable.

Definition

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 Legacy the act of disposition by the testator in separating from the inheritance for
definite purposes, things, rights, or a definite portion of his property

Validity of the Legacy

General Rule ​- If a will is disallowed for non-compliance with the formalities prescribed by
law, the legacy made in the will would also be void.
Exception​ - If the heir voluntarily pays the legacy, the payment is effective and irrevocable.

Moral Duty
Since it was the intention of the testator to give the legacy, it is the moral duty of the heir to
carry it out.

E​S​ᴛᴏᴘᴘᴇʟ
[Art. 1431]
Through estoppel an admission or representation is rendered conclusive upon the person
making it, and cannot be denied or disproved as against the person relying thereon.
[Art. 1432]
The principles of estoppel are hereby adopted insofar as they are not in conflict with the
provisions of this Code, the Code of Commerce, the Rules of Court and special laws.

Concept of Estoppel
1. A bar which precludes a person from denying or asserting anything to the contrary of
that which has, in contemplation of law, been established as the truth.
a. Either because of the acts of judicial or legislative officers; or
b. By his own acts, representations, or admissions, ​express or implied​. (De
Leon)
2. A condition or state by virtue of which an admission or representation is rendered
conclusive upon the person making it and cannot be denied or disproved as against
the person relying thereon. (Jurado)

Matters to which Estoppel has been Applied

1. Often​ held to apply only to ​matters of fact
a. But SC has held that a person may be estopped to set up a right under the
Constitution, to take inconsistent legal positions, or to deny that he is an
officer ​de jure​ in a criminal prosecution for acts done as such officer.

Source of Provisions on Estoppel

1. According to the Code Commission:
a. The principle of estoppel, which is an important branch of ​American law​, will
afford solution​ to many questions which are ​not foreseen in our legislation​.
b. Under the old Code, there are some articles whose underlying principle is that
of estoppel;

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 → But the fact that it ​does not definitely recognize estoppel as a
separate and distinct
branch of our legal system has not at all helped in the solution of these
problems.
2. Due to the incorporation of estoppel in the New Civil Code, estoppel has become an
equitable defense ​that is both ​substantive and remedial​.
a. Hence, its successful invocation can ​bar a right, a ​ nd not merely its equitable
enforcement.

Principles of Estoppel Adopted

1. Under 1432, the principles of estoppel are ​adopted insofar as they are not in conflict
with the provisions of this Code, the Code of Commerce, the Rules of Court and
special laws.
a. Under the Rules of Court, Sec. 2(a) of Rule 131 provides that ​“whenever a
party has, by his own declaration, act, or omission, ​intentionally and
deliberately​ led another to believe a particular thing true, and to act upon such
belief, ​he cannot​, in any litigation arising out of such declaration, act, or
omission, ​be permitted to falsify it.”​

Basis and Purpose of Estoppel

1. Basis
a. Upon the grounds of public policy, fair dealing, good faith, and justice.
2. Purpose
a. To forbid one to speak against his own act, representations, or commitments
to the injury of one who has relied on them.
b. Concludes the truth in order to prevent fraud and falsehood.

When Estoppel is not Applicable*

1. Against the government suing in its capacity as sovereign or asserting governmental
rights
2. When a law or public policy will be violated
3. Against the government owing to the mistakes or errors of its officers
4. Questions of Law

*Not absolute, as principle must give way to exceptions based on, and in keeping
with, the interest of ​justice and fairness.

Jurisprudence
La Naval Drug Corp. vs. Court of Appeals
Estoppel is not a rule that should apply prevalently but should apply as a mere
exception from the standard legal norms of general application that can be invoked only in
highly exceptional and justifiable cases. Estoppel is not favored in law being in the nature of
a forfeiture.

Phil. Airlines Employees Association vs. Philippine Airlines, Inc.

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 The doctrine of equitable estoppel is one of fundamental justice. It’s applicability
depends to a large extent upon the circumstances of each particular case.

Metropolitan Waterworks and Sewerage System vs. Court of Appeals

The doctrine cannot arise against a party except when justice o the rights of others
demands it and when to refuse it would be inequitable. It is to be applied or denied as the
equities between the parties may preponderate.

Republic vs Go Bon Lee; Comm. of Internal Revenue vs Court of Appeals

The doctrine does not apply against the government suing in its capacity as
sovereign or asserting government rights.
The state or government is never estopped by the mistakes or errors, negligence or
omission on the party of its officials or agents, or wrong construction of the law, or
unauthorized or illegal acts of public officials.

Prudential Bank vs Panis

Estoppel cannot be predicated on an illegal act.

Alsua-Betts vs Court of Appeals

It is not applicable in probate proceedings relative to the question of testamentary
capacity of a person.

Soriano vs Sahagun
If a party having a right to pursue one of several inconsistent remedies makes his
election, institutes suit, and prosecutes it to final judgement, such election of remedies
constitutes an estoppel to pursue another.

Southeast Asian Fisheries Development Center vs. NLRC

The general rule is that estoppel does not apply to confer jurisdiction to a tribunal that
has none over a cause of action.
A party is estopped from disputing the jurisdiction of the court after invoking it himself.

Talisman vs Ofania
Criminal actions for public offenses cannot be waived or condoned, much less barred
by the rules of estoppel.

AFP Mutual Benefit Assn. vs. AFP-MBAIEU

In labor jurisprudence, quit claims and complete releases executed by employees do
not estop them from pursuing their claims studying from unfair labor practices of the
employer.

[Art. 1433]
Estoppel may be​ in pais​ or by deed.

Kinds of Estoppel
1. Estoppel by Record
a. It is the preclusion to deny the truth of matters set forth in a record and also
deny the facts adjudicated by a court of competent jurisdiction.

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 b. The record may be judicial or legislative.
c. When a right or fact has been judicially tried and determined by a court of
competent jurisdiction, it should be conclusive upon the parties and those in
privity with them.
→ the principle of res judicata and the rule on conclusiveness of
judgement is
applicable
2. Estoppel by Deed
a. Bar which precludes one party to a deed and his privies from asserting as
against the other party and his privies any right or title in derogation of the
deed, or from denying the truth of any material facts asserted in it
3. Estoppel ​in pais​ (or by conduct)
a. That which arises from:
→ Acts
→ Representations
→ Admissions
→ Silence
→ Acceptance of benefits derived
b. It applies when the foregoing acts are done intentionally or through culpable
negligence by one who induces another to believe certain facts exist and such
other rightfully relies and acts on such belief.
c. The consequence is that the one who believed will be prejudiced if the one
who induced is permitted to deny the existence of such facts.
d. Estoppel by laches
→ arises from silence of inaction

Jurisprudence
Republic v. Court of Appeals
Principal sought nullification of sale effected by agent seven (7) months after
receiving checks in payment of price.
The agent having acted within his authority, the principal’s retention of the checks for
the aforesaid months without expressing any protest or objection was clear procrastination
and indecision.

Estoppel by Record and Estoppel ​in pais​ Compared

Estoppel by Record and by Deed Estoppel​ in pais

As to Reference

Sometimes referred to as technical Referred to as equitable estoppels or

estoppels estoppels in pais

As to source

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 Regulated by well-settled rules and admit It arises out of the acts or conduct of the
of certain application, party estopped AND NOT from a record or
deed

There is a difficulty in prescribing a

universal rule of universal application since
this depends on particular circumstances.

Jurisprudence
Iriola v. Felices
Vendor invokes estoppel on the part of vendee to deny title of former to the property
(land) sold, but latter’s suit for reconveyance refers to other properties not included in the
sale.
That there were statements in the deed of sale allegedly proving as evidence an
estoppel by record or deed was not accepted by the court — for to be considered as an
estoppel by deed, a distinct and precise assertion of fact is necessary, estoppel should be
certain to every intent; and that estoppel by deed cannot prevent the denial of an equitable
title which is not identical with the legal title, no estoppel can be predicated on the deed of
sale a retro executed by both parties. The subject of complaint was not the parcel of land
bought under the deed, thus, estoppel does not apply.

Rules of Promissory Estoppel

1. Estoppel arising from a promise made without consideration
a. A party may not renege on his promises after the other had complied with the
former’s conditions.
b. An estoppel may arise from the making of a promise even though without
consideration, if it was intended that the promise should be relied upon and
was in fact relied upon.
2. Elements
a. Promise reasonably expected to induce action or forbearance
b. Such promise did not in fact induce such action or forbearance
c. The party suffered detriment as a result
3. Nature or character of promise
a. The doctrine presupposes the existence of a promise on the part of one
against whom estoppel is claimed.
b. The promise must be plain and unambiguous.
c. The cause of action does not lie where an alleged oral promise was
conditional, so that reliance upon it was not reasonable.
d. It does not operate to create liability where it does not otherwise exist.

Jurisprudence
Ramos v. Central Bank
Central bank liquidated a private bank after the latter complied with the conditions for
its rehabilitation imposed by the former.
Promissory estoppel applies as CB cannot renege on its representations (to
rehabilitate bank provided the latter complies with the conditions set by CB) to the detriment

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of its stockholders, depositors, and other creditors. The conduct of CB reveals a calculated
attempt to evade rehabilitation of said bank despite CB’s promises in violation of Art 1159
and 1315 of the Civil Code.

Requisites of Estoppel ​in pais

1. As related to the party to be estopped
a. Conduct which amounts to a false representation or concealment of material
facts, or at least which is calculated to convey the impression that the facts
are otherwise than, and inconsistent with those which the party subsequently
attempts to assert
b. The intention or at least the expectation, that such conduct shall be acted
upon, or influence, the other party or other persons
c. Knowledge, actual or constructive, of the real facts
2. As related to the party claiming the estoppel
a. Ignorance or lack of knowledge and of the means of knowledge of the truth as
to the facts in question
b. Reliance in good faith, upon the conduct or statement of the party to be
estopped
c. Action or inaction based thereon of such a character as to change the position
or status of the party claiming the estoppel, to his injury, detriment, or
prejudice

Jurisprudence, As related to the party to be estopped

Rodriguez v. Martinez
Maker of a promissory note concealed from indorsee that it was issued for a
gambling debt and assured him that the note was good.
The maker is still liable to pay the indorsee as the former is estopped from claiming
that the note was in payment of a gambling debt. Even if such unlawful consideration did
exist, the maker deliberately concealed it from the indorsee. The indorsee having only
accepted the indorsement because the note was represented as good by the maker, and the
maker not disclosing the unlawfulness of the object of the note, the maker cannot now turn
away from his obligation.

Board of Directors of PCSO v. Alandy and Court of Appeals

A person claimed to be estopped had no knowledge of the fact that his acceptance of
a new appointment to the same position the name of which has been changed would deprive
him of his right to claim the position when it is recreated and another is appointed thereto.
The Court ruled that estoppel requires that a person claimed to be estopped must
have knowledge of the fact that his voluntary acts would deprive him of some rights because
said voluntary acts are inconsistent with said rights. Said person cannot be held in estoppel
as he had no knowledge of, nor had been made to understand the consequences of the
acceptance of his appointment would create.

Industrial Finance Corp. v. Tobias

Mortgagee-seller of a truck, sold said truck on installments. The buyer defaulted, and
in giving the mortgagor-buyer the option to return the truck mortgagee-seller did not know
that the truck had been damaged because of an accident.

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 The Court held the mortgagee-seller not in estoppel to insist its claim on the balance
as when buyer opted return of the truck, it must be shown that when the options were given
to the buyer, the seller already had knowledge of the accident and the consequent damage
to the truck. In addition, the court found it hard to believe that seller, assuming it had
knowledge of the accident, would still give the aforesaid options to the buyer in default.

Garchitorena v. Register of Deeds of Camarines Sur

A party to a case, after securing a court order for the posting of a bond by the other
party for the entry of a notice of lis pendens, asks for the cancellation of the notice.
The party asking for cancellation is already estopped, as his acts of asking for a bond
by the other party proved that the former has elected to allow the notice to remain. The act of
securing an order of a bond by the other party who filed notice of lis pendens is an implied
admission that the notice was a proper one.

Noda v Social Security System

A department head of the Social Security System made an erroneous representation
that borrower’s MRI coverage included permanent total disability.
The Court ruled that SSS cannot be held in estoppel as the claimants cannot profit
on the mistaken representation, in good faith, by the SSS employee. The Court also
observed that the claimants did not really rely on such representation as it was only after 4
years when said claimants asked for the enforcement of the application of benefits to their
loan, which the court described as a delay in action not compatible with their claim of
reliance to the representation.

Jurisprudence, As related to the party claiming the estoppel

Herman v Radio Corp.
Whenever a party has, by his own declaration, act, or omission, intentionally and
deliberately led another to believe a particular thing true, and to act upon such belief, he
cannot, in any litigation arising out of such declaration, act, or omission, be permitted to
falsify it. Plaintiff having led the defendant to believe that the claim for salary had been
waived and to contract on that basis, the plaintiff is now estopped from asserting the claim.

Cristobal v. Gomez
Estoppel may not be invoked by a person party to the collusion, by reason that he
could not have been misled.An equitable estoppel can only be invoked by one who is in a
position to be misled by the misrepresentation with respect to which the estoppel is invoked
and under circumstances where damage would result to him from the adoption by the
person estopped of a position different from that which has been held out to be true.

Dizon v. Suntay
Not only has the ownership and the origin of the jewels misappropriated been
unquestionably proven but also that Sison, acting fraudulently and in bad faith, disposed of
them and pledged them contrary to agreement with no right of ownership, and to the
prejudice of Suntay, who was illegally deprived of said jewels and who, as the owner, has an
absolute right to recover the jewels from the possession of whosoever holds them, which in
this case is Dizon’s pawnshop. Dizon ought to have been on guard before accepting the
pledge in question, but evidently there was no such precaution availed of and he has no one
to blame but himself. While the activity he is engaged in is no doubt legal, it is not to be lost
sight of that it thrives on taking advantage of the necessities precisely of that element of our
population whose lives are blighted by extreme poverty. From whatever angle the question is
viewed then, estoppel certainly cannot be justly invoked.
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Estoppel without Reliance upon Conduct of Another
1. In technical estoppel, the party to be estopped must have acted knowingly as to
mislead his adversary.
2. The adversary must have placed reliance of the action and acted as he would not
have otherwise done.
3. Some authorities believe that reliance on the part of the adversary is not necessary in
estoppel.
a. This is called ratification or election by acceptance of benefits under Art.
1438.

Diligence of Party Claiming Equitable Estoppel

1. One who claims the benefit of estoppel must not have been misled by his own want
of reasonable care.
2. Good faith is generally regarded as the exercise of reasonable diligence to learn the
truth.
3. Estoppel does not extend in favor of those who are charged with notice of the true
facts, or facts and circumstances which could have disclosed those true facts (even
with exercise of due diligence).

Equitable Estoppel and Waiver Compared

→​Waiver and estoppel are loosely used interchangeably.
→​The essence of waiver is estoppel and where there is no estoppel, there is no
waiver.
Waiver Estoppel

Intention to relinquish right

Waiver is a voluntary and intentional Equitable estoppel may arise even though
abandonment or relinquishment of a known there was no intention on the part of the
right estopped to relinquish or change any
existing right

As to the prejudice to the other party

Does not necessarily imply that the party Prejudice to the other party is one of the
asserting it has been misled to his essential elements
prejudice

As to required conduct

Involves the conduct of only one of the Equitable involves the contract of both
parties. It depends upon what one himself parties, since it is based upon some
intended to do regardless of the attitude misleading conduct or language of one
assumed by the other party person and reliance by another thereon

As to the implication of fraud

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Waiver does not carry implication of fraud Frequently carries the implication of fraud

Equitable Estoppel and Ratification Compared

Ratification Estoppel

Substance

Confirmation after conduct Inducement to another to act to his

prejudice

How are parties bound

Party is bound because he intended to be He is bound notwithstanding that there was

no such intention because the other party
will be prejudiced and defrauded by his
conduct

As to prejudice

Does not rest upon prejudice Applied if the other party would be unjustly
prejudiced

Laches
Laches Failure or neglect, for an unreasonable and unexplained length of time, to do
that which, by exercising due diligence, one could or should have done earlier

Negligence or omission to assert a right within a reasonable time

1. Essence of Estoppel - aims to bring out justice between parties, though the operation
of the principle that an admission person making it
a. Laches are not concerned with mere lapse of time
b. The law serves those who are vigilant and diligent and not those who sleep
when the law requires them to act
c. Laches presupposes a waiver of one’s right
i. This is an implied waiver arising from the knowledge of existing
conditions
d. The doctrine presumes that the party guilty of negligence, silence or inaction
had the right and opportunity to speak or do what should have been done but
failed to do so
e. If said party did not have the occasion to assert the right, then, he cannot be
adjudged guilty of laches
f. Mere innocent silence or inaction will not work an estoppel
g. Laches cannot also attach to contracts null and void
h. In labor cases, laches may be applied only upon the most convincing
evidence of deliberate inaction

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2. Basis - on grounds of public policy which requires, for the peace of society, the
discouragement of stale claims
a. It is not a mere question of time but is a question of inequity or unfairness
b. Operates not really to penalize neglect or failure to assert a right within a
reasonable time but to avoid recognizing a right when to do so would result in
a clearly inequitable situation or in an injustice
c. But it cannot be invoked to defeat justice or to perpetrate fraud or injustice
3. Elements
a. Conduct on the part of the defendant or of one under whom he claims, giving
rise to the situation of which complaint is made
b. Delay in asserting the complainant’s right, the complainant having knowledge
or notice of the defendant’s conduct and having been afforded an opportunity
to sue
i. Actual knowledge is not necessary
ii. Enough that such knowledge may be imputed to the complainant
iii. THIS ELEMENT IS THREE-TIERED
1. Knowledge of defendant’s action
2. Opportunity to sure defendant after obtaining such knowledge
3. Delay in the filing of such suit
c. Lack of knowledge or notice on the part of the defendant that the complainant
would assert the right on which he bases his suit
d. Injury or prejudice to the defendant in the event relief is accorded to the
complainant, or the suit is not held to be barred
4. There is no absolute rule as to what constitutes laches or staleness of demand
a. The question of laches is addressed to the sound discretion of the court, to be
determined according to the circumstances of each case
b. The application of laches is controlled by equitable considerations
5. Rights barred by laches still subsist
a. Unlike estoppel, laches usually bars only the equitable enforcement of a right
but not the right itself
b. It is an affirmative defense and the burden of proving it rests be on the
defendant
c. Laches need not be specifically pleaded and may be considered by the court
in its own initiative in determining the rights of the parties
d. Equitable rights barred by laches still subsist albeit in an empty manner as the
guilty party cannot assert them judicially
i. but they may be revived or activated by the waiver of those whose
rights have ripened due to the laches
ii. and it can be exercised to the extent of the rights waived
6. Laches is not based on a fixed time
a. It does not involve mere lapse or passage of time but is principally an
impediment to the assertion or enforcement of a right which has become
under the circumstances inequitable or unfair to permit
b. Laches can be invoked without reckoning any specific or fixed period

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 i.It is sufficient that there be unreasonable and unexplained delay in
bringing the action that its maintenance would already constitute
inequity or injustice to the party invoking
ii. Action for laches may find application even to imprescriptible actions
such as to annul a void or inexistent contract
7. When there is a claim filed within the prescriptive period, the doctrine of laches is not
applicable
a. Delay within the prescriptive period is sanctioned by law- meaning that laches
cannot be applied earlier that the expiration of time limited for the
commencement of actions in law
i. Unless inexcusable delay in asserting a right and acquiescence in
existing conditions are proven (this is a general rule)
ii. Exception: reasons of inequitable proportions are adduced, a delay
within the prescriptive period is sanctioned by law and is not
considered to be delay that would bar relief

Jurisprudence
Miguel v. Catalino
The vendor, and also his heirs could have instituted an action to annul the sale from
the time they knew the invalidity of sale which is a matter of law; they did not have to wait for
34 years to institute suit. The defendant was made to feel secure in the belief that no action
would be filed against him by such passivity which justifies the setting up the equitable
defense of laches.

Mapa III v. Guanzon

Mapa had been in possession of parcel for 30 years under claim of ownership without
heirs questioning the former’s adverse possession. While it cannot be denied that no title to
the registered land in derogation to that of registered owner shall be acquired by
prescription, this legal guarantee may in appropriate case yield to the right of a third person
on equitable principle of laches.

Cristobal v. Melchor
Principle of equity, need not be bound to a rigid application of the law, but rather its
action should conform to the conditions or exigencies of a given problem or situation in order
to grant a relief that will serve the ends of justice. The doctrine cannot be applied against
Cristobal when defendant is shown to have promised from time to time to grant relief sought.
There was no acquiescence or inaction on the part of Cristobal amounting to abandonment
of his right to reinstatement.

Gayotin v. Tolentino
The defense of laches is an equitable one concerned only with whether or not by
reason of the plaintiffs long inaction or inexcusable neglect, he should be barred from
asserting his claim at all, because to allow him to do so would be inequitable and unjust to
defendant.The facts show no such "long inaction or inexcusable neglect" on respondents'
part. Public policy with regard to homestead law requires that plaintiffs should not be
prevented by reacquiring land given to them by law for home and cultivation. This right

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cannot be waived. It is not within the competence of any, citizen to barter away what public
policy by law seeks to preserve.

[Art. 1434]
When a person who is not the owner of a thing sells or alienates and delivers it, and later the
seller or grantor acquires title thereto, such title passes by operation of law to the buyer or
grantee.

Situation Contemplated
1. Person sells a thing without title (i.e. he does not have ownership of the item he is
selling)
2. After some time, he acquires title over the item
Rule - The seller, who sells an item to which he does not have a title at the time of the
transaction but subsequently acquires the title to such item sold, is estopped from denying
the validity of the sale of the thing sold.
→ Prejudice is not essential

[Art. 1435]
If a person in representation of another sells or alienates a thing, the former cannot
subsequently set up his own title as against the buyer or grantee.

Situation Contemplated
1. An agent for the principal sells or alienates a thing
2. The agent has a title claim over the thing sold
Rule - ​ The agent is estopped from questioning the validity of the sale to the buyer because
he himself facilitated the transaction and acted as an agent.
→ Prejudice is not essential

[Art. 1436]
A lessee or a bailee is estopped from asserting title to the thing leased or received, as
against the lessor or bailor.

Definition
Bailee A person or party to whom goods are delivered for a purpose, such as custody or
repair, without transfer of ownership

Situation Contemplated, Lease

1. Lessee leases the property of lessor
2. Lessee denies the lessor’s ownership of the property leased
General Rule - ​The presumption is that the lessee is estopped from denying the title of the
lessor, even if the lessor does not actually have a title over the property he rents out.
Exception - ​An exception is when the lessee denies the existence of the lease contract.
→Eg. When the landlord, at the time of the commencement of the relationship, did
not attach or plead in his complaint the contract of lease

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Situation Contemplated, Commodatum, Depositum, Pledge
1. There is an existing contract of commodatum, depositum, or pledge
Rule - ​The bailee is estopped from asserting title over the thing received, against the bailor.

[Art. 1437]
When in a contract between third persons concerning immovable property, one of them is
misled by a person with respect to the ownership or real right over the real estate, the latter
is precluded from asserting his legal title or interest therein, provided all these requisites are
present:
(1) There must be fraudulent representation or wrongful concealment of facts known to the
party estopped;
(2) The party precluded must intend that the other should act upon the facts as
misrepresented;
(3) The party misled must have been unaware of the true facts; and
(4) The party defrauded must have acted in accordance with the misrepresentation.

Situation Contemplated
1. Two parties contract over an immovable property as buyer and seller
2. The indicated seller in the contract is not the owner of the lot
a. His name was only indicated therein in fraudulent representation
b. Requisites
→ Fraudulent misrepresentation or wrongful concealment or the facts known
to the party estopped
→ Intent of the indicated seller that the buyer should act upon the facts as
misrepresented
→ Unawareness of the buyer of the true facts
→ Action of the buyer in accordance with the representation
Rule - ​The indicated seller is estopped from asserting legal title or interest over the lot sold
to the buyer.

[Art. 1438]
One who has allowed another to assume apparent ownership of personal property for the
purpose of making any transfer of it, cannot, if he received the sum for which a pledge has
been constituted, set up his own title to defeat the pledge of the property, made by the other
to a pledgee who received the same in good faith and for value.

Estoppel by Acceptance of Benefits, Generally

1. Estoppel is frequently based upon the acceptance and retention by one having
knowledge and notice of the facts, of benefits from a transaction, contract, instrument
regulation, or statute which he might have rejected or contested.
2. Estoppel by acceptance of benefits finds application in many different files and under
a wide variety of circumstances. One such example is Art. 1438.
a. Pledge – a contract, by virtue of which, the debtor delivers to the creditor or to
a third person a movable, or document evidencing incorporeal rights, for the
purpose of securing the fulfillment of a principal obligation with the

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 understanding that when the obligation is fulfilled, the thing delivered shall be
returned with all its fruits and accessions.

Estoppel by Acceptance of Benefits v. Ratification

1. It has been said that the case is referable to the principles of ratification when no
fraud, either actual or constructive is involved.
a. The results produced, however, is clearly the same and the distinction is not
usually made.
b. Such estoppel precludes one who accepts the benefits from repudiating the
accompanying or resulting obligation, and may operate to prevent a party
from profiting by his own wrong.

Jurisprudence
Magana v Auditor General
Where an employee had accepted the benefits accruing from the ​abolition of his
office by enjoying his unused vacation and sick leave and receiving the corresponding
gratuity, he is estopped from questioning its validity or deemed to have waived the right to
contest the same.

Blue Bar Coconut Phil Inc v NLRC

Quitclaims executed by laborers are commonly frowned upon as contrary to public
policy and ineffective to bar claims for the full measure of the workers’ right under the law.
Acceptance of benefits ​such as separation pay by employees does NOT amount to
estoppel.

Cabiling v Pabualan
In a case, the appointees, having accepted the acting appointments as ​acting
Mayor, Vice-Mayor, and councilors of a newly created municipality, and having acted
thereunder for a considerable time, the court ruled that they cannot now be heard to say that
such appointments were permanent.

Borja v Vda. De Torres v Encarnacion

The heirs, after securing approval of a project of partition and its execution,
questioned the jurisdiction of the probate court to order delivery of property in their
possession. The Court however held that in the face of what they have done, they are
estopped from attacking the validity of the partition, or any part of it.
A party cannot, in law and in good conscience, be allowed to reap the fruits of a
partition, agreement, or judgment and then repudiate what does not suit him.

Philippine Scrappers, Inc v Auditor General

A person who obtains a license under a law and seeks for a time to enjoy the
benefits thereof, cannot afterwards, and when the license is sought to be revoked, question
the constitutionality of the act.

[Art. 1439]
Estoppel is effective only as between the parties thereto or their successors in interest.

Persons Affected by Estoppel

1. An estoppel operates ​only on the parties to the transaction out of which it arises and
their privies.

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 a. This is true notwithstanding that the privies are not personally liable on the
covenants creating the estoppel.
2. Conversely, if anybody may be heard to challenge the application of the doctrine of
estoppel, it is only the party against whom it may be invoked.
a. Thus, a stranger to the transaction is neither bound by, nor in a position to
take advantage of, an estoppel arising therefrom.
b. This is because mutuality is an essential element of estoppel; and estoppel
must bind both parties or neither is bound.

Jurisprudence
Francisco v GSIS
If a ​private corporation intentionally or negligently clothes its officers or agents with
apparent power to perform acts for it, the corporation will be estopped to deny that such
apparent authority is real as to innocent third persons dealing in good faith such officers or
agents.

Luciano v Estrella
The ​government is generally NOT estopped by the mistake or error on the part of its
officials or agents.

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