Professional Documents
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COMMODATUM Case Digests
COMMODATUM Case Digests
If the contract was one of lease, then the 10% breeding charge is
compensation (rent) for the use of the bull and Bagtas, as lessee, is
subject to the responsibilities of a possessor. He is also in bad faith
because he continued to possess the bull even though the term of
the contract has already expired.
Jose Bagtas borrowed from the Bureau of Animal Industry three bulls
for a period of one year for breeding purposes subject to a
government charge of breeding fee of 10% of the book value of the
books.
Upon the expiration of the contract, Bagtas asked for a renewal for
another one year, however, the Secretary of Agriculture and Natural
Resources approved only the renewal for one bull and other two bulls
be returned.
The original period of the loan was from 8 May 1948 to 7 May 1949.
The loan of one bull was renewed for another period of one year to
end on 8 May 1950. But the appellant kept and used the bull until
November 1953 when during a Huk raid it was killed by stray bullets.
Bagtas neither paid nor returned the bulls. The Republic then
commenced an action against Bagtas ordering him to return the bulls
or pay their book value.
After hearing, the trial Court ruled in favor of the Republic, as such,
the Republic moved ex parte for a writ of execution which the court
granted.
ISSUE: WON the contract was commodatum;thus, Bagtas be held liable for
its loss due to force majeure.
RULING:
The Court of Appeals found that petitioner Vicar did not meet the
requirement of 30 years possession for acquisitive prescription over
Lots 2 and 3. Neither did it satisfy the requirement of 10 years
possession for ordinary acquisitive prescription because of the
absence of just title. The appellate court did not believe the findings
of the trial court that Lot 2 was acquired from Juan Valdez by
purchase and Lot 3 was acquired also by purchase from Egmidio
Octaviano by petitioner Vicar because there was absolutely no
documentary evidence to support the same and the alleged
purchases were never mentioned in the application for registration.
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SPV (SPECIAL PURPOSE VEHICLE INSOLVENCY LAW)
It may be recalled that the Special Purpose Vehicle (SPV) Act of 2002 was
enacted into law on December 23, 2002 and became effective on April 9,
2003. It is intended to help banks dispose of their NPAs (non-performing
assets) by waiving some of the taxes and reducing fees usually collected in
the sale or transfer of assets. The SPV Law waived the documentary stamp
tax, capital gains tax and EVAT and reduced the applicable registration and
The SPV is organized as a stock corporation under Philipp ine Laws with
the primary purpose of investing in or acquiring NPAs of financial
institutions, and disposing of them through various strategies. If the SPV
will acquire land, foreign investors face a maximum of 40% share of its
capital stock, with the rest being owned by Philippine Nationals. The SPVs
can issue equity or participation certificates or other forms of Investment
Unit Instruments for the purpose of acquiring, managing, improving and
disposing of the NPAs. Banks are not allowed to purchase IUIs issued by
the SPV that acquired its NPAs.
Function
The Fria replaces and repeals the Insolvency Law (Act No. 1956), which was
enacted in 1909 and was almost universally acknowledged as outdated and
obsolete. The Fria also impliedly amends the Interim Rules on Corporate
Rehabilitation first issued by the Supreme Court in 2000 (and amended in
2008), given several inconsistencies between those rules and the new Fria. It
is expected that the Supreme Court will issue new rules on procedure to
govern corporate rehabilitation in conformity with the Fria.
Under the Fria, a debtor is considered "insolvent" if it is "generally unable to
pay its or his liabilities as they fall due in the ordinary course of business or
has liabilities that are greater than its or his assets." The Fria provides for the
following modes of rehabilitating an insolvent corporate debtor: