Menchavez vs.

Teves
Facts:
On February 28, 1986 a Contract of Lease of a Fishpond was executed between the
plaintiffs, as lessor and the respondent as lessee. On June 2, 1988 the fishpond
dikes constructed by respondent was demolished as ordered by Cebu RTC. As a
result, he filed a Complaint for damages alleging that petitioners violated their
contract of lease specially the peaceful and adequate enjoyment of property for the
entire duration of the contract. The RTC declared the Contract as void and declared
both parties in pari delicto. The CA however reversed the decision. Thus the present
appeal.
Issue:
Are the parties of the Contract of Lease in Pari delicto?
Ruling:
Under the 1987 Constitution specifically declares that all lands of the public domain,
waters, fisheries and other natural resources belong to the State.18Included here
are fishponds, which may not be alienated but only leased, thus making the
Contract of Lease void. We apply the maxim NEMO DAT QUOD NON HABET meaning ONE CANNOT GIVE WHAT HE DOES NOT HAVE. Petitioners are applicants of
the fishponds. Even if the State grants them the lease, the law also prohibits
sublease of the fishponds.
The parties are in pari delicto or in equal fault and the law deny them aid for any
claims against the other and courts leave them as they are. However Article 1412 of
the Civil Code provides the exception.
"Art. 1412. If the act in which the unlawful or forbidden cause consists does not
constitute a criminal offense, the following rules shall be observed:
"(1) When the fault is on the part of both contracting parties, neither may recover
what he has given by virtue of the contract, or demand the performance of the
others undertaking;
"(2) When only one of the contracting parties is at fault, he cannot recover what he
has given by reason of the contract, or ask for the fulfillment of what has been
promised him. The other, who is not at fault, may demand the return of what he has
given without any obligation to comply with his promise."
The petition is GRANTED.