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Banking Corp. v. Lui She

G.R. No. L-17587, 12 September 1967
FACTS:
Justina Santos executed on a contract of lease of real properties in favor of Wong.The lease was for
50 years, although the lessee was given the right to withdraw at any time from the agreement.
Subsequently, she executed another contract giving Wong the option to buy the leased premises for
P120,000, payable within ten years at a monthly installment of P1,000. The optionimposed on him the
obligation to pay for the food of the dogs and the salaries of the maids in her household, the charge
not to exceed P1,800 a month. The option was conditioned on his obtaining Philippine citizenship, a
petition for which was then pending in the CFI of Rizal.
It appears, however, that this application for naturalization was withdrawn when it was discovered that
he was not a resident of Rizal. On October 28, 1958 she filed a petition to adopt him and his children
on the erroneous belief that adoption would confer on them Philippine citizenship. The error was
discovered and the proceedings were abandoned.
In two wills, she bade her legatees to respect the contracts she had entered into with Wong, but in a
codicil of a later date she appears to have a change of heart. Claiming that the various contracts were
made by her because of machinations and inducements practiced by him, she now directed her
executor to secure the annulment of the contracts.
ISSUE:
Whether the contracts involving Wong were valid.
RULING:
No, the contracts show nothing that is necessarily illegal, but considered collectively, they reveal an
insidious pattern to subvert by indirection what the Constitution directly prohibits. To be sure, a lease
to an alien for a reasonable period is valid. So is an option giving an alien the right to buy real property
on condition that he is granted Philippine citizenship.
But if an alien is given not only a lease of, but also an option to buy, a piece of land, by virtue of which
the Filipino owner cannot sell or otherwise dispose of his property, this to last for 50 years, then it
becomes clear that the arrangement is a virtual transfer of ownership whereby the owner divests
himself in stages not only of the right to enjoy the land but also of the right to dispose of it.
Article 1416 of the Civil Code provides, as an exception to the rule on pari delicto, that “When the
agreement is not illegal per se but is merely prohibited, and the prohibition by law is designed for the
protection of the plaintiff, he may, if public policy is thereby enhanced, recover what he has paid or
delivered.” The Constitutional provision that “Save in cases of hereditary succession, no private
agricultural land shall be transferred or assigned except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain in the Philippines” is an expression of public
policy to conserve lands for the Filipinos.
Accordingly, the contracts in question are annulled and set aside; the land subject-matter of the
contracts is ordered returned to the estate of Justina Santos.

Testate of Estate of Ramirez v. Ramirez, et al.

GR No. L-27962, February 15, 1982

FACTS:
Jose Eugenio Ramirez died leaving as principal beneficiaries his widow, MarcelleSemoron de
Ramirez, a French woman; his two grandnephews Roberto and Jorge Ramirez; and his companion
Wanda de Wrobleski. His will was admitted to probate by the Court of First Instance. According to the
will ½ shall go to Marcelle in full ownership plus usufruct of the 1/3 of the whole estate; the grandsons
shall have the ½ of the whole estate; and a usufruct in favour of Wanda.
ISSUE:
 Is the partition according to the will valid?
RULING:
No. As to the usufruct granted to Marcelle, the court ruled that to give Marcelle more than her legitime
will run counter to the testator’s intention for his dispositions even impaired her legitime and tended to
favor Wanda.As to the usufruct in favour of Wanda, the Court upheld its validity. The Constitutional
provision which enables aliens to acquire private lands does not extend to testamentary succession
for otherwise the prohibition will be for naught and meaningless. Any alien would be able to
circumvent the prohibition by paying money to a Philippine landowner in exchange for devise of a
piece of land. Notwithstanding this, the Court upholds the usufruct in favour of Wanda because a
usufruct does not vest title to the land in the usufructuary and it is the vesting of title to aliens which is
proscribed by the Constitution.
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The court distributed the estate by: ½ to his widow and ½ to the grandsons but the usufruct of the
second half shall go to Wanda.
Case Digest: MULLER vs MULLER

IN RE: PETITION FOR SEPARATION OF PROPERTY; MULLER VS. MULLER

G.R. No. 149615, August 29,2006

Doctrine:
He who seeks equity must do equity, and he who comes into equity must come with clean hands.
Facts:
Petitioner Elena Buenaventura Muller and respondent Helmut Muller were married in Hamburg,
Germany on September 22, 1989. The couple resided in Germany at a house owned by respondent’s
parents but decided to move and reside permanently in the Philippines in 1992. By this time,
respondent had inherited the house in Germany from his parents which he sold and used the
proceeds for the purchase of a parcel of land in Antipolo, Rizal at the cost of P528,000.00 and the
construction of a house amounting to P2,300,000.00. The Antipolo property was registered in the
name of petitioner, Elena Buenaventura Muller.
Due to incompatibilities and respondents alleged womanizing, drinking, and maltreatment, the
spouses eventually separated.
On September 26, 1994, respondent filed a petition for separation of properties before the Regional
Trial Court of Quezon City. The court granted said petition. It also decreed the separation of
properties between them and ordered the equal partition of personal properties located within the
country, excluding those acquired by gratuitous title during the marriage. With regard to the Antipolo
property, the court held that it was acquired using paraphernal funds of the respondent. However, it
ruled that respondent cannot recover his funds because the property was purchased in violation of
Section 7, Article XII of the Constitution.
The respondent elevated the case to the Court of Appeals, which reversed the decision of the RTC.  It
held that respondent merely prayed for reimbursement for the purchase of the Antipolo property, and
not acquisition or transfer of ownership to him. It ordered the respondent to REIMBURSE the
petitioner the amount of P528,000.00 for the acquisition of the land and the amount of P2,300,000.00
for the construction of the house situated in Antipolo, Rizal.
Elena Muller then filed a petition for review on certiorari.
Issue:
Whether or not respondent Helmut Muller is entitled to reimbursement.
Ruling:
No, respondent Helmut Muller is not entitled to reimbursement.
Ratio Decidendi:
There is an express prohibition against foreigners owning land in the Philippines.
Art. XII, Sec. 7 of the 1987 Constitution provides:  “Save in cases of hereditary succession, no private
lands shall be transferred or conveyed except to individuals, corporations, or associations qualified to
acquire or hold lands of the public domain.”
In the case at bar, the respondent willingly and knowingly bought the property despite a constitutional
prohibition. And to get away with that constitutional prohibition, he put the property under the name of
his Filipina wife. He tried to do indirectly what the fundamental law bars him to do directly.
With this, the Supreme Court ruled that respondent cannot seek reimbursement on the ground of
equity. It has been held that equity as a rule will follow the law and will not permit that to be done
indirectly which, because of public policy, cannot be done directly.
Ting Ho vs Teng Gui

 GR No. 130115 July 16, 2008

Facts:
Felix Ting Ho, Jr., Merla Ting Ho Braden, Juana Ting Ho and Lydia Ting Ho Belenzo against their
brother, respondent Vicente Teng Gui.   The controversy revolves around a parcel of land, and the
improvements which should form part of the estate of their deceased father, Felix Ting Ho, and should
be partitioned equally among each of the siblings. Petitioners alleged that their father Felix Ting Ho
died intestate on June 26, 1970, and left upon his death an estate. According to petitioners, the said
lot and properties were titled and tax declared under trust in the name of respondent Vicente Teng
Gui for the benefit of the deceased Felix Ting Ho who, being a Chinese citizen, was then disqualified
to own public lands in thePhilippines; and that upon the death of Felix Ting Ho, the respondent took
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possession of the same for his own exclusive use and benefit to their exclusion and prejudice.

Issue:
Whether or not the sale was void

Ruling:
No, the sale was not void. Article 1471 of the Civil Code has provided that if the price is simulated, the
sale is void, but the act may be shown to have been in reality a donatin, or some other act or contract.
The sale in this case, was however valid because the sale was in fact a donation. The law requires
positive proof of the simulation of the price of the sale. But since the finding was based on a mere
assumption, the price has not been proven to be a simulation.

RD OF RIZAL vs. UNG SIU SI TEMPLE DIGEST

DECEMBER 21, 2016 ~ VBDIAZ
G.R. No. L-6776             May 21, 1955
THE REGISTER OF DEEDS OF RIZAL, petitioner-appellee, 
vs.
UNG SIU SI TEMPLE, respondent-appellant.
FACTS: The Register of Deeds for the province of Rizal refused to accept for record a deed of
donation executed in due form on January 22, 1953, by Jesus Dy, a Filipino citizen, conveying a
parcel of residential land, in Caloocan, Rizal, known as lot No. 2, block 48-D, PSD-4212, G.L.R.O.
Record No. 11267, in favor of the unregistered religious organization “Ung Siu Si Temple”, operating
through three trustees all of Chinese nationality. The donation was duly accepted by Yu Juan, of
Chinese nationality, founder and deaconess of the Temple, acting in representation and in behalf of
the latter and its trustees.
CFI upheld the action of the Rizal Register of Deeds. Basis: sections 1 and 5 of Article XIII of the
Constitution of the Philippines limiting the acquisition of land in the Philippines to its citizens, or to
corporations or associations at least sixty per centum of the capital stock of which is owned by such
citizens adopted after the enactment of said Act No. 271, and the decision of the Supreme Court in
the case of Krivenko vs. the Register of Deeds of Manila, the deed of donation in question should not
be admitted for admitted for registration.
Not satisfied with the ruling of the Court of First Instance, counsel for the donee Uy Siu Si Temple has
appealed to this Court, claiming: (1) that the acquisition of the land in question, for religious purposes,
is authorized and permitted by Act No. 271 of the old Philippine Commission, providing as follows:
SECTION 1. It shall be lawful for all religious associations, of whatever sort or denomination, whether
incorporated in the Philippine Islands or in the name of other country, or not incorporated at all, to hold
land in the Philippine Islands upon which to build churches, parsonages, or educational or charitable
institutions.
SEC. 2. Such religious institutions, if not incorporated, shall hold the land in the name of three
Trustees for the use of such associations; . . .. (Printed Rec. App. p. 5.)
and (2) that the refusal of the Register of Deeds violates the freedom of religion clause of our
Constitution [Art. III, Sec. 1(7)].
ISSUE: whether a deed of donation of a parcel of land executed in favor of a religious organization
whose founder, trustees and administrator are Chinese citizens should be registered or not.
HELD:
The provisions of Act No. 271 of the old Philippine Commission must be deemed repealed since the
Constitution was enacted, in so far as incompatible therewith. In providing that, —
Save in cases of hereditary succession, no private agricultural land shall be transferred or assigned
except to individuals, corporations or associations qualified to acquire or hold lands of the public
domain in the Philippines,
the Constitution makes no exception in favor of religious associations.
The fact that the appellant religious organization has no capital stock does not suffice to escape the
Constitutional inhibition, since it is admitted that its members are of foreign nationality. To permit
religious associations controlled by non-Filipinos to acquire agricultural lands would be to drive the
opening wedge to revive alien religious land holdings in this country.
The resolution appealed from is affirmed, with costs against appellant.
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JG SUMMIT HOLDINGS v. CA, GR No. 124293, 2003-09-24

Facts:
the National Investment and Development Corporation (NIDC), a government corporation, entered
into a Joint Venture Agreement (JVA) with Kawasaki Heavy Industries, Ltd. of Kobe, Japan
(KAWASAKI) for the construction, operation and management of the Subic
National Shipyard, Inc. (SNS) which subsequently became the Philippine Shipyard and Engineering
Corporation (PHILSECO). Under the JVA, the NIDC and KAWASAKI will contribute P330 million for
the capitalization of PHILSECO in the proportion of 60%-40% respectively.
One of its salient features is the grant to the parties of the right of first refusal should either of them
decide to sell, assign or transfer its interest in the joint venture
NIDC transferred all its rights, title and interest in PHILSECO to the Philippine National Bank (PNB).
Such interests were subsequently transferred to the National Government pursuant to Administrative
Order No. 14. On December 8, 1986, President Corazon C.
Aquino issued Proclamation No. 50 establishing the Committee on Privatization (COP) and the Asset
Privatization Trust (APT) to take title to, and possession of, conserve, manage and dispose of non-
performing assets of the National Government.
a... trust agreement was entered into between the National Government and the APT wherein the
latter was named the trustee of the National Government's share in PHILSECO. In 1989, as a result
of a quasi-reorganization of PHILSECO to settle its huge obligations to PNB, the National
Government's shareholdings in PHILSECO increased to 97.41% thereby reducing KAWASAKI's
shareholdings to 2.59%.
In the interest of the national economy and the government, the COP and the APT deemed it best to
sell the National Government's share in PHILSECO to private entities. After a series of negotiations
between the APT and KAWASAKI, they agreed that the latter's right of first... refusal under the JVA be
"exchanged" for the right to top by five percent (5%) the highest bid for the said shares
As petitioner was declared the highest bidder, the COP approved the sale on December 3, 1993
"subject to the right of Kawasaki Heavy Industries, Inc./Philyards Holdings, Inc. to top JGSMI's bid by
5% as specified in the bidding rules."
Consequently, petitioner filed with this Court a Petition for Mandamus under G.R. No. 114057. On
May 11, 1994, said petition was referred to the Court of
Appeals. On July 18, 1995, the Court of Appeals denied the same for lack of merit. It ruled that the
petition for mandamus was not the proper remedy to question the constitutionality or legality of the
right of first refusal and the right to top that was exercised by
KAWASAKI/PHI, and that the matter must be brought "by the proper party in the proper forum at the
proper time and threshed out in a full blown trial."
On November 20, 2000, this Court rendered the now assailed Decision ruling among others that the
Court of Appeals erred when it dismissed the petition on the sole ground of the impropriety of the
special civil action of mandamus because the petition was also one of... certiorari.
It further ruled that a shipyard like PHILSECO is a public utility whose capitalization must be sixty
percent (60%) Filipino-owned.
Issues:
Whether PHILSECO is a public utility
Ruling:
we hold that PHILSECO is not a public utility for the following reasons:
First.  By nature, a shipyard is not a public utility.
A "public utility" is "a business or service engaged in regularly supplying the public with some
commodity or service of public consequence such as electricity, gas, water, transportation, telephone
or telegraph service."
To constitute a public... utility, the facility must be necessary for the maintenance of life and
occupation of the residents. However, the fact that a business offers services or goods that promote
public good and serve the interest of the public does not automatically make it a public utility. Public...
use is not synonymous with public interest. As its name indicates, the term "public utility" implies
public use and service to the public.
"Public use" means the same as "use by the public." The essential feature of the public use is that it is
not confined to privileged individuals, but is open to the indefinite public. It is this indefinite or
unrestricted quality that gives it its public character.
In determining whether a use is public, we must look not only to the character of the business to be
done, but also to the proposed mode of doing it.  If the use is merely optional with the owners, or the
public benefit is merely incidental, it is not a public use,... authorizing the exercise of jurisdiction of the
public utility commission. There must be, in general, a right which the law compels the owner to give
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to the general public. It is not enough that the general prosperity of the public is promoted. Public use
is not synonymous with... public interest. The true criterion by which to judge the character of the use
is whether the public may enjoy it by right or only by permission.
A "shipyard" is "a place or enclosure where ships are built or repaired."
Its nature dictates that it serves but a limited clientele whom it may choose to serve at its discretion.
While it offers its facilities to whoever may wish to avail of its... services, a shipyard is not legally
obliged to render its services indiscriminately to the public. It has no legal obligation to render the
services sought by each and every client. The fact that it publicly offers its services does not give the
public a legal right to... demand that such services be rendered.
It is worthy to note that automobile and aircraft manufacturers, which are of similar nature to
shipyards, are not considered public utilities despite the fact that their operations greatly impact on
land and air transportation. The reason is simple. Unlike commodities or... services traditionally
regarded as public utilities such as electricity, gas, water, transportation, telephone or telegraph
service, automobile and aircraft manufacturing---and for that matter ship building and ship repair---
serve the public only incidentally.
Second. There is no law declaring a shipyard as a public utility.

FACTS: The case is about a bidder of Government PNCC shares and securities, Strategic Alliance
Development Corporation (STRADEC) who has alleged its claim against PNCC (formerly
Construction Development Corporation of the Philippines (CDCP)), a GOCC that has issued
guarantee letters for a loan obtained from Radstock Securities Limited. The said loan was originally
made against Marubeni Corporation which was later assigned to Radstock.

ISSUE: Whether or not GOCCs are included in the audit jurisdiction of COA.

HELD: GOCCs are included in the audit jurisdiction of COA as its jurisdiction extends not only to
government "agencies or instrumentalities," but also to "government-owned and controlled
corporations with original charters" as well as "other government-owned or controlled corporations"
without original charters.