DETERMINATION OF VALIDITY OF WAIVER OF RIGHTS

G.R. No. L-15127, May 30, 1961

CUI vs. ARELLANO UNIVERSITY

CONCEPCION, J.:

Doctrine: Only waiver of rights that are not against law, public order or public policy, moral or good
customs are valid.

Facts: The plaintiff enrolled to the defendant’s school from first year to fourth year first semester
because his Uncle, Francisco R. Capistrano, was the dean of the College of Law and legal counsel of the
defendant university. During his stay in defendant university, he was awarded scholarship grants that his
semestral tuitions were to be refunded every after semestral ends. But before defendant awarded to
plaintiff the scholarship grants as above stated, he was made to sign a waiver stating ‘I hereby waive my
right to transfer to another school without having refunded to the University (defendant) the equivalent
of my scholarship cash’. In fourth year second semester, his uncle severed ties with the defendant
university and transferred to Abad Santos University which the appellant has later followed on. After
graduating in law from Abad Santos University he applied to take the bar examination. To secure
permission to take the bar he needed the transcripts of his records in defendant Arellano University.
However, the defendant refused to issue such records without him paying all the tuition fees that was
awarded to him. As he could not take the bar examination without those transcripts, plaintiff paid to
defendant the said sum under protest. Later, the appellant brought out an action to recover a sum of
P1,033.87. The lower court resolved this question in the affirmative in favor of defendant, upon the
ground that the aforementioned memorandum of the Director of Private Schools is not a law; that the
provisions thereof are advisory, not mandatory in nature; and that, although the contractual provision
"may be unethical, yet it was more unethical for plaintiff to quit studying with the defendant without
good reasons and simply because he wanted to follow the example of his uncle."

Issue: Whether or not the waiver of the appellant’s right to transfer to another school without
refunding to the latter the equivalent of his scholarships in cash, is valid or not?

Ruling: No. The waiver is not valid.

In case at bar, the waiver that is being talked about concerns public policy, morals & good customs. It
must be noted that under Article 6 of Civil Code, rights may be waived unless it is contrary to law, public
policy or public order, good customs or morals.

Hence, the Supreme court decided that the decision appealed from is hereby reversed and orders the
defendant to pay the plaintiff the sum of P1,033.87, with interest thereon at the legal rate from
September 1, 1954, date of the institution of this case, as well as the costs, and dismissing defendant's
counterclaim.