LAST MINUTE TIPS IN CIVIL LAW

FOR THE 2022 BAR EXMINATIONS

(by PROF. ELMER T. RABUYA)

(This is the intellectual property of Prof. Elmer T. Rabuya. Copying any parts of
this work in writing materials or book for publication, including electronic document form,
without proper attribution is prohibited by law.)

MORNING SESSION

PERSONS AND FAMILY RELATIONS

1) A foreigner got married to a Filipino citizen in the Philippines. Subsequently, the

foreigner filed a petition to declare the marriage void pursuant to Article 36 of the
Family Code. Will the petition prosper? ANS: Yes, the petition will prosper pursuant
to the principle of lex loci celebrationis. Since the marriage is celebrated in the
Philippines and one of the parties is a citizen of the Philippines, the validity of the
marriage will be governed by the law of the Philippines, as a rule, because it is the
place where the marriage was celebrated.

2) Both spouses are foreigners and residing in the Philippines. One of them filed a
petition to declare the marriage void pursuant to Article 36 of the Family Code. Will
the petition prosper? ANS: No, the petition will not prosper pursuant to the
nationality principle. Since the parties are both foreigners, the Family Code of the
Philippines will not apply because the validity of the marriage of the parties shall
be governed by their national laws. Under Article 15 of the Civil Code, the issue of
status, condition, legal capacity, and family rights and duties shall be governed by
the national law of the person involved.

3) The siblings of A filed an action against A for reconveyance of their hereditary

share in the property allegedly left by their deceased parents, who are both Indian
nationals. The complainants claimed that the parcel of land in Bel Air, Makati was
actually purchased by their parents but registered only in the name of A in trust for
the parents and the other siblings. Will the action prosper? ANS: No, because the
complaint failed to state a cause of action. The siblings of A cannot possibly
acquire successional rights over the parcel of land located in Bel Air, Makati
because their parents, being foreigners, are prohibited by the Philippine
Constitution from acquiring and owning lands in the Philippines. The legal capacity
of foreigners to acquire lands in the Philippines shall be governed by the Philippine
laws pursuant to the principle of lex rei sitae, and not by the nationality principle.

4) X and Y purchased different parcels of land from A. Upon the death of A, his
grandchild, G, filed a criminal action against X and Y for falsification, alleging that
they forged the signatures of A in the deeds of sale. During the pendency of the

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 criminal action, B and C, who are children of A, filed a civil action for the declaration
of nullity of the sale made by A to X and Y and for reconveyance. B and C alleged
that X and Y merely falsified the signatures of A in the deeds of sale. The court
ruled in favor of X and Y in the civil action declaring the signatures of A in the deeds
of sale to be genuine. After the finality of the decision in the civil action, X and Y
moved for the dismissal of the criminal action on the ground of prejudicial question.
Is prejudicial question applicable and may the criminal action be dismissed on said
ground? ANS: Yes, although the case involves a criminal action which preceded
the institution of the civil action, the strict sequence of institution of the two actions
as provided for by the Rules of Criminal Procedure is more directory than
mandatory. Hence, the prejudicial factual finding of genuineness of the seller’s
signatures on the questioned Deeds of Sale in the civil case must operate to bar
the prosecution of the accused for the falsification of the same signatures on the
same questioned Deeds of Sale. The doctrine of a prejudicial question serves the
following purposes: (i) to avoid multiplicity of suits; (ii) avoid unnecessary litigation;
(iii) avoid conflicting decisions; (iv) safeguard the rights of the accused; and (v)
unclog the courts' dockets.

5) S is an illegitimate child of M and actor B, who is married to actress L. B recognized

his paternity over S. After such recognition, S did not use B’s surname until his
mother M got married to his step-father P. Upon the marriage of M and P, P
adopted S. Hence, S had been using the surname of P since the adoption. When
S entered showbiz, he filed a petition for change of surname to that of his biological
father B. The reason for his petition is that he wanted to be identified as a son of
B and to be close to B’s legitimate family. If you were the court, will you grant the
petition? ANS: No, because a change of surname is not a right but a mere privilege
that can only be granted if there is a valid reason. In the case at bar, there is no
valid reason to allow S to change his surname. Instead, the change of surname of
S will only result into confusion because while he may be a biological child of S,
he remains to be the legitimate son of P by virtue of the adoption. Under the law,
an adopted child must use the surname of the adopter. In addition, a sincere desire
to associate oneself to a certain person or family, without more, does not justify a
change of surname.

6) Spouses A and B are both Catholics who got married in a Catholic church.
Subsequently A filed in court a petition to declare the marriage void on the ground
of psychological incapacity. The trial court dismissed the petition on the ground
that it has no jurisdiction over the case. The court ruled that the jurisdiction lies
with the Matrimonial Tribunal of the Catholic Church since the marriage took place
pursuant to the Canon Law of the Catholic Church. The court additionally ruled
that the State cannot inquire into the validity of a marriage celebrated pursuant to
the Canon Law if the ground is psychological incapacity since that is also a ground
for annulment under the Catholic Church. Is the Court correct? ANS: No, because
the nature, consequences, and incidents of a marriage are all governed by law,

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 including the matter of the validity of the marriage. The annulment of the marriage
on the ground of psychological incapacity under the Canon Law is different from
the declaration of nullity of a marriage based on the same ground under the Family
Code. The former does not bind the State. It is the latter which is binding upon the
State. Hence, our courts have jurisdiction over the petition filed by A, applying the
Family Code and BP 129.

7) X, a Filipino citizen, entered into an arrangement with Y, a Japanese national. In

their agreement, they have decided to simulate a marriage to facilitate the
application of X for a Japanese visa. But they agreed that the marriage contract is
not to be registered in the Civil Registry. They got married before a religious
solemnizer in the City Hall of Manila, where they were made to sign a blank
marriage contract by the solemnizing officer in the latter’s presence. X was
surprised to find out that the marriage contract was registered in the Civil Registry
of San Juan City. Upon checking, X discovered that the license appearing in the
marriage contract was never really issued by the Civil Registry of San Juan City.
Is the marriage void? ANS: Yes, the marriage is void because it was celebrated
without a valid marriage license. Under the law, a marriage which has been
celebrated without a valid marriage license is a void marriage if the same is not
exempt from the requirement of a marriage license. Here, the marriage of X and Y
is not exempt from the requirement of a marriage license. In addition, the absence
of a valid marriage license is proof that the marriage of X and Y is merely simulated
or fake.

8) O, a Filipino citizen, applied for a Certificate of No Marriage (CeNoMar) from the

PSA. She was not, however, issued a CeNoMar because she was already married
to a Korean national. O filed a petition for the correction and/or cancellation of entry
in the Civil Registry under Rule 108, claiming that someone used her identity in
contracting a marriage to the Korean national. The OSG opposed the petition on
the ground that the proper remedy of O is to file a petition to declare the marriage
void. Is the OSG correct? ANS: No, the OSG is not correct because if it is true that
someone made use of O’s identity in contracting the marriage to the Korean
national, there is no marriage involving O that can be the subject of a declaration
of absolute nullity. A petition for declaration of nullity of a marriage presupposes
that the petitioner had contracted a marriage, but such marriage is declared by law
to be void ab initio.

9) X contracted two marriages during the effectivity of the Family Code. The first
marriage was to A; the second, to B. When X was prosecuted for bigamy, he put
up the defense that the prior marriage was void because it was celebrated without
a valid marriage license. To prove the absence of a marriage license, the only
proof presented by X is a certification issued by the Local Civil Registrar that the
license does not appear in the record of the local civil registry. Is the proof
submitted by X sufficient to prove that the first marriage was celebrated without a

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 valid marriage license? ANS: No, because if such certification is presented for the
purpose of obtaining an acquittal in a criminal prosecution for bigamy, said
certification may not be accorded the presumption of regularity in the performance
of official duties. Hence, such certification alone is not a sufficient proof of the
absence of a valid marriage license at the time of the celebration of the marriage.
[On the other hand, if such certification is presented in a civil action for declaration
of nullity of the marriage, the same is sufficient proof because it enjoys the
presumption of regularity.]

10) F, a Filipino citizen, was married to J, a Japanese national. In 2015, F obtained a

decree of divorce in Japan, which divorce capacitated J to contract another
marriage. In 2016, F married X, another Filipino citizen. In 2021, F filed a petition
for the judicial recognition of the decree of divorce which she obtained in Japan.
Will the petition prosper? ANS: Yes, because according to the en banc ruling in
Republic v. Manalo, Article 26, par. 2, of the Family Code is applicable regardless
of who may have obtained the decree of divorce abroad. If the decree of divorce
obtained abroad has the effect of releasing the foreigner spouse from the marriage,
then the Filipino spouse is also released from the marriage applying Article 26, par.
2, of the Family Code, regardless of who may have obtained the decree of divorce.

11) In the previous problem, F was prosecuted for bigamy for contracting a subsequent
marriage without a previous judicial recognition of the decree of divorce obtained
abroad. It is the position of the prosecution that F does not automatically regain
her capacity to remarry upon the issuance of the divorce but will only regain such
capacity once the divorce is judicially recognized. Is the prosecution correct? ANS:
No, because F may prove in the criminal action that when she contracted the
subsequent marriage, she was already released from the previous marriage. In
other words, the judicial recognition of the divorce obtained abroad need not be
done in a separate proceeding solely for the said purpose. Instead, the judicial
recognition can be put up as a defense in the criminal action for bigamy.

12) The marriage of A and B was declared void in 2015 on the ground of B’s
psychological incapacity. In 2018, A contracted another marriage to X. Upon the
death of A in 2020, B and her children with A filed a petition to declare the marriage
of A to X void on the ground of failure to comply with the procedural requirements
of Article 52 of the Family Code prior to contracting the subsequent marriage. Will
the petition prosper? ANS: No, the petition will not prosper because the petitioners
do not have the legal personality to file the petition. In the en banc ruling of the
Court in David v. Calilung, it was held that for marriages contracted during the
effectivity of the Family Code, only the husband or the wife of the marriage to be
declared void who shall have the legal personality to file the petition pursuant to
AM No. 02-11-10-SC. The only exception is when the ground is bigamy, where the
aggrieved spouse in the prior marriage also has the personality to file the petition.
Hence, B has no legal personality to file the petition because she is no longer the

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 wife of A considering that her marriage to A was already declared void by the court.
The children of A and B likewise do not have the personality to file the petition.
However, they may still question the validity of the marriage of A to X during the
settlement of the estate of A.

13) In the above problem, what if the children of A and B raised the issue of the
absolute nullity of the marriage between A and X during the settlement of the estate
of A, on the ground of failure to comply with the procedural requirements of Article
52 of the Family Code prior to the celebration of the subsequent marriage of A and
X. May the court declare the marriage of A and X void? ANS: No, because Article
52 of the FC will only be applicable if the prior marriage is a voidable marriage
which has been annulled by a final judgment of the court or it is a void marriage
under Article 40 of the Family Code which has been declared void by the court.
Article 52 does not apply if the prior marriage is declared void for a reason other
than Article 40 of the Family Code, for in the latter situation the property regime of
the parties in the prior void marriage is either Article 147 or 148, and not absolute
community nor conjugal partnership of gains.

14) X filed a petition for the declaration of nullity of his marriage to Y on the ground of
the latter’s psychological incapacity to fulfill the essential marital obligations. X
presented witnesses who testified: that they knew Y since she was a child; that Y
grew up in a dysfunctional family where the father was known for abusing his
children (physically, verbally, psychologically and even sexually); that was the
reason why Y became care-free and promiscuous. X also testified that during their
marriage, Y had several extra-marital affairs, even to some of his friends. He also
testified that Y never maintained and took care of the household and their family.
After trial, the RTC dismissed the petition for failure of the petitioner to prove that
Y’s incapacity was by reason of psychological illness. The trial court also faulted X
for failing to present an expert witness who could have established the root cause
of Y’s alleged psychological incapacity. X filed an appeal. Will the appeal prosper?
ANS: Yes, because the Supreme Court, in its en banc ruling in Tan-Andal v. Andal,
already abandoned previous decisions which declare psychological incapacity in
Article 36 of the FC to be a form of mental or psychological illness. Instead, the
Court clarified in Tan-Andal, that psychological incapacity is an enduring and
durable aspect of one’s personality structure which is so dysfunctional that it
renders him or her totally unable to comply with the essential marital obligations.
Since psychological incapacity is no longer viewed as an illness but a personal
condition of the spouse suffering from it, the cause of such incapacity is not medical
but brought about by genuine serious psychic cause that can be testified to by
ordinary witnesses. Hence, the testimony of an expert witness is not necessary. In
this case, the totality of the evidence presented establishes Y’s psychological
incapacity. Hence, the marriage is void.

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15) X is married to Y. While they were still living together in 2017, X, without the
knowledge of Y, obtained a judgement from the RTC of Tarlac City declaring Y
presumptively dead. After obtaining the judgment, X abandoned Y and married A
in 2018. In 2019, when Y discovered the subsequent marriage of X to A, she filed
a petition for the declaration of nullity of said marriage on the ground of bigamy.
The trial court dismissed the petition on two grounds: (1) that the proper remedy
of Y is to file an affidavit of reappearance in the appropriate civil registry; and (2)
Y has no legal personality to file the petition because she is not a party to the
marriage subject matter of the petition. Is the court correct? ANS: No, because the
remedy of recording of affidavit of reappearance is not applicable if the subsequent
marriage is void for the simple reason that there is nothing to be terminated in a
void marriage. The subsequent marriage is void on the ground of bigamy because
the following requisites are not complied with prior to the celebration of the
subsequent marriage: (1) the prior spouse must have been absent for a period of
four or two years; (2) the spouse present must have a well-founded belief that the
absentee spouse is already dead; and (3) the spouse present obtained a judicial
declaration of presumptive death of the absentee spouse. Since the subsequent
marriage is void on the ground of bigamy, Y, being the aggrieved spouse in a prior
marriage, has the personality to file the petition to declare the subsequent marriage
void pursuant to the ruling of the Court in Juliano-Llave v. Republic and Fujiki v.
Marinay.

16) When E and D were still sweethearts, D got pregnant. Convinced by D that he is
the father of the child, E decided to live with D as husband and wife when D gave
birth to the child. When the child was already three years old, E and D decided to
marry each other. After the marriage, E still doubted his paternity over the child.
Hence, he decided to undergo DNA test. The DNA test revealed that E was not
the child’s father. Thereafter, E filed a petition to annul his marriage to D on the
ground of fraud, specifically under Article 45(3), in relation to Article 46(2), of the
Family Code. Will the action prosper? ANS: No, the petition will not prosper
because to constitute fraud that warrants annulment under Article 46(2), it is
necessary that: (1) the wife must have been pregnant by a man other than her
husband at the time of the marriage; and (2) the wife must have fraudulently
concealed the same. In this case, the facts do not warrant annulment of the
marriage under Article 46(2) of the FC because the wife was not pregnant at the
time of the marriage since the child was already three years old when the marriage
was celebrated.

17) T and M got married in 2012, without a marriage settlement. In 2014, T acquired a
house and lot in Makati City through his salaries. Since M was merely maintaining
the household without a gainful employment, T made her sign a waiver of her
interest over the house and lot in Makati City in favor of T. After the waiver, T
donated the house and lot to his child in the previous marriage, named A. In 2019,
T obtained a judgment from the court declaring his marriage to M void on the

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 ground of psychological incapacity on the part of both parties. Upon the death of T
in 2021, M filed an action in court to declare void both the waiver she made in favor
of T and the donation made by T in favor of A. M argued that the waiver she made
is void pursuant to Article 89 of the Family Code; while the donation without her
consent is also void pursuant to Article 98 of the same Code. With respect to the
waiver of M’s interest over the house and lot, is M correct that such waiver is void
pursuant to Article 89 of the Family Code? ANS: Yes, M is correct that the waiver
is void but the applicable law is not Article 89. Article 89 is not applicable in this
case because the property regime of M and T is neither absolute community of
property nor conjugal partnership of gains. Instead, the property regime of M and
T is that which is provided for under Article 147 of the Family Code considering
that the marriage of the parties is void by reason of psychological incapacity. But
even if the marriage of M and T is void ab initio, the second sentence of Article 87
prohibits persons living together as husband and wife without a valid marriage from
donating to each other. Since the waiver made by M in favor of T is gratuitous, it
partakes of the nature of a donation which is prohibited under the second sentence
of Article 87. Hence, the donation or waiver is void.

18) In the previous problem, is M correct that the donation of the house and lot without
her consent is void pursuant to Article 98 of the Family Code? ANS: Yes, M is
correct that the donation made by T without her consent is void, but the applicable
law is not Article 98. Article 98 is not applicable because the property regime of the
parties is Article 147 and not absolute community. Pursuant to Article 147, the
subject property is deemed a co-owned property of T and M because the latter
contributed in its acquisition by her acts of maintaining the household. Since the
subject property is a co-owned property, the third paragraph of Article 147 prohibits
T from disposing the entire property without the consent of M. Under said provision,
T is prohibited from disposing his ideal share during the cohabitation without the
consent of his co-owner M. If T is prohibited from disposing even his ideal share
without M’s consent, it is with more reason that he may not dispose of the entire
co-owned property without M’s consent. Hence, the disposition of the entire co-
owned property during the cohabitation without the consent of the other co-owner
is void.

19) Prior to their marriage in 1997, X and Y executed a marriage settlement providing
for conjugal partnership of gains as their property regime. In 2004, the spouses X
and Y acquired a parcel of land in Tagaytay City. In 2015, Y died. She was survived
by X and her two siblings, A and B. Without liquidating the conjugal partnership of
his prior marriage, X contracted another marriage to W in 2017, without a marriage
settlement. In 2018, X sold the parcel of land in Tagaytay City to R. The sale was
made without the consent of W. After the death of X in 2020, A and B filed an
action against R for the declaration of nullity of the sale made by X to R,
reconveyance of ownership, partition and damages. They claimed to be co-owners
of the subject property, being the legal heirs of Y. They contended that the sale to

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 R is void because X failed to comply with the mandatory requirement of liquidation
of the property regime of X and Y. In the said action, W intervened claiming that
the subject property is an absolute community property of X and W and that the
sale made by X of such property without her consent is void pursuant to Article 96
of the Family Code. R sought the dismissal of the complaint for failure of the
complainants to establish their status as legal heirs of Y in a special proceeding.
R also opposed the right of W to intervene, claiming that the subject property is an
exclusive property of X.

May the action filed by A and B prosper despite the lack of a prior and separate
judicial declaration of heirship in relation to the estate of Y? ANS: Yes, the action
will prosper. In Treyes v. Larlar, the Court en banc ruled that unless there is a
pending special proceeding for the settlement of the decedent's estate or for the
determination of heirship, the compulsory or intestate heirs may commence an
ordinary civil action to declare the nullity of a deed or instrument, and for recovery
of property, or any other action in the enforcement of their ownership rights
acquired by virtue of succession, without the necessity of a prior and separate
judicial declaration of their status as such. However, the Court clarified that the
ruling of the trial court shall only be in relation to the cause of action of the ordinary
civil action, i.e., the nullification of a deed or instrument, and recovery or
reconveyance of property, which ruling is binding only between and among the
parties.

20) In Question No. 19, is the sale made by X to R entirely void in view of the failure
of X to liquidate the conjugal partnership of X and Y within one year from the death
of Y, as mandatorily required under Article 130 of the Family Code? ANS: No, the
sale is not entirely void because upon the death of Y, one-half of the subject
property was automatically reserved in favor of the surviving spouse, X, as his
share in the conjugal partnership. The other half is Y’s share, which is transmitted
to her legal heirs, X, A, and B, with X inheriting ½ of Y’s estate, while A and B
inheriting the other half. Thus, the subject property was under a state of co-
ownership when X sold said property to R. While X cannot sell the entire property
because he cannot validly sell the shares of A and B in the co-ownership, he can
freely sell and dispose of his undivided interest, equivalent to ¾ undivided share
in the subject property. Consequently, the sale by X of his ¾ undivided share in
the subject property is not necessarily void, for his right as a co-owner thereof was
effectively transferred, making the buyer, R, a co-owner of the subject property.
But the sale did not affect the undivided shares of A and B in the subject property.

21) In Question No. 19, is the sale of X’s undivided share in the subject property to R
void in view of the absence of W’s consent to the transaction? ANS: No, the sale
is valid because the undivided share of X in the subject property is his separate
property. This is so because the property regime of the marriage of X and W is the
mandatory regime of complete separation pursuant to Article 130 of the Family

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 Code. According to Article 130, if the conjugal partnership is terminated by reason
of death of one of the spouses and the surviving spouse failed to liquidate the
conjugal partnership within one year from the death of the deceased spouse, the
mandatory regime of complete separation will apply to the subsequent marriage of
the surviving spouse. As applied in the problem, since X failed to liquidate the
conjugal partnership of the previous marriage within the one-year period, the
mandatory regime of complete separation applies to the marriage of X and W.
Hence, X brought his ¾ undivided share in the subject property to the subsequent
marriage as his separate property. Consequently, the consent of W is not needed
for its disposition.

22) A and B got married prior to the effectivity of the Family Code, without a marriage
settlement. During their marriage, B donated a parcel of land acquired during the
marriage in favor of S, her child in a previous marriage. Such donation was without
the knowledge and consent of A. Thereafter, S sold the subject property to R. Upon
discovery of the donation and sale, A filed an action against B, S, and R for the
declaration of nullity of the donation and sale. During the pendency of the action,
B died. If you were the court, will you declare the donation and sale void? ANS:
No, because upon the death of B, the conjugal partnership was already terminated
and her one-half undivided share in the subject property already became an actual
title that she may validly dispose of without the consent of her husband A.
Accordingly, the right of S, as donee, is limited only to the one half undivided
portion that B owned. The donation insofar as it covered the remaining one-half
undivided portion of the subject property is null and void, A not having consented
to the donation of his undivided half. Hence, the sale made by S to R is also valid,
but only with respect to the one-half undivided portion of the subject property that
was validly acquired by S.

23) X and Y got married in 1979, without a marriage settlement. In 1986, X sold to M
a property acquired during the marriage without the knowledge and consent of Y.
Upon the death of X in 2015, Y filed an action to declare the sale made by X to M
void on the ground that the sale involved a conjugal property and the same was
made without her consent. If you were the court, will you declare the sale void?
ANS: No, the sale is not void but merely voidable but the right of Y to annul the
contract had long prescribed. The property regime of X and Y is conjugal
partnership because they got married without a marriage settlement during the
effectivity of the Civil Code. Therefore, the subject property is presumed to be a
conjugal property. According to the en banc ruling of the Court in Cuenco v.
Bautista, the proper characterization of a contract of sale of conjugal property by
one of the spouses without the consent of the other spouse made during the
effectivity of the Civil Code is that the same is merely voidable and not void
because the aggrieved spouse is given by law the right to annul the contract within
a period of ten years from the date of the questioned transaction. Since the
questioned transaction took place in 1986, the right of Y to file the action for

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 annulment had already prescribed in 1997. Hence, the action filed by Y in 2015
can no longer prosper.

24) Husband H borrowed from creditor C the amount of P1 Million, without the
knowledge and consent of his wife W. H also issued a post-dated check in favor
of C in the amount of P1.2 Million. H gambled and lost the entire proceeds of the
loan in the casino. In the meantime, the check issued by H to C bounced. In the
criminal action filed by C against H for violation of BP 22, the criminal case was
dismissed but the court rendered a decision on the civil aspect of the BP 22 case
against H, finding him liable for the amount of P1.2 Million representing the value
of the bounced check and P100,000 as attorney’s fees and other litigation
expenses. To satisfy the judgment, C caused the attachment of the conjugal
property of H and W contending that the conjugal property may be levied upon to
answer for the civil liability adjudged against one spouse in a criminal case. May
the conjugal partnership property be levied to answer for the civil liability imposed
upon H? ANS: No, the conjugal property of H and W is not liable for the civil liability
imposed upon H. While there is jurisprudence to the effect that conjugal properties
may be levied to answer for the civil liability adjudged against one spouse in a
criminal case, in those cases the erring spouses were found guilty beyond
reasonable doubt of the crimes charged against them and thus, the civil liabilities
imposed are interpreted to fall within the purview of "fines and indemnities"
referred to in Article 122 of the Family Code. In this case, however, the criminal
case was dismissed and only the civil aspect of the BP 22 case was resolved, i.e.,
the liability for the loan obtained by H as evidenced by the bounced check, and
thus, is properly characterized as a "debt or obligation." Since the debt of H was
contracted without the consent of W and the same did not redound to the benefit
of the family (because H gambled and lost the proceeds of the loan), the conjugal
partnership is not liable to pay the civil liability imposed upon H. Hence, the
conjugal property cannot be levied to answer for H’s sole liability.

25) D had an illicit relationship with a married man, M, with whom she had a child, A.
D did not register the birth of A in the Civil Registry to avoid humiliation. Unknown
to D, M registered the birth of A in the Civil Registry. He registered A following his
surname. Eventually, D and M got separated. When D filed an application for the
delayed registration of the birth of A, the application was denied on the ground that
A’s birth was already registered in the Civil Registry. D filed an action to cancel the
birth certificate of A registered by M. Will the action prosper? ANS: Yes, because
the birth certificate registered by M is void. Under the law, it is mandatory that the
mother of an illegitimate child signs the birth certificate of her child in all cases,
irrespective of whether the father recognizes the child as his or not. Since the birth
certificate registered by M is contrary to the mandatory provision of the law, the
same is null and void.

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26) In the above problem, can A use the surname of M on the basis of the recognition
of paternity made by M in his birth certificate? ANS: No, because the right of an
illegitimate child to use the surname of the illegitimate father is subject to
compliance with the requirements of Article 176, as amended by RA 9255. In this
case, there is no express recognition of paternity made by the father in the child’s
birth certificate, nor in any instrument, whether public or private handwritten
instrument. The child may not rely on the birth certificate registered by the
illegitimate father as basis to acquire the right to use the father’s surname because
said birth certificate is null and void.

27) Jose Chiong died leaving several parcels of land in Metro Manila. After his death,
his collateral relatives (surnamed Chiong Fernando) executed a deed of
extrajudicial settlement of his estate. Subsequently, or in 2002, they caused the
cancellation of the titles of the subject properties under the original collective name
of "Heirs of Jose Chiong" and had them transferred to their names. In 2003, several
persons (surnamed Chiong Bernardo) claimed to be the rightful heirs of the late
Jose Chiong. They filed an action for annulment, reconveyance and accounting.
In their complaint, they claimed that their deceased mother (Bernarda Chiong) was
born to the Spouses Jose Chiong and Ambrosia Domingo. As proof, they
presented the birth certificate and baptismal certificate of Bernarda Chiong. Will
the action prosper? ANS: No, the action will not prosper because the same had
already prescribed. The action filed by the complainants is effectively an action to
establish the legitimate filiation of Bernarda Chiong to the late Jose Chiong. Under
the law, such kind of action may only prosper if the same is filed during the lifetime
of Bernarda Chiong. While an action to establish legitimate filiation can be
transmitted to the child’s heirs, such transmissibility is only allowed in two
situations: (1) when the child dies during minority; or (2) when the child dies during
a state of insanity. Neither of the two situations apply in this case. Hence, the action
to establish the legitimate filiation of Bernarda Chiong to the late Jose Chiong can
no longer prosper because the same had already prescribed.

28) A is the child of X and Y, who are not married to each other. Since Y is studying in
Manila, A was left in the custody of her father, X. One day, Y instructed her parents
to obtain the custody of A from X. Thus, while A was in school, she was fetched
by her maternal grandfather and was never returned to X, prompting the latter to
file a petition for habeas corpus against Y and the latter’s parents. In his petition,
X alleged that Y and her parents are unfit to exercise parental authority over A.
Without affording X the opportunity to present evidence to prove his allegations,
the trial court dismissed the petition of X. The court ruled that X is not entitled to
obtain custody of A because he is not granted by law parental authority over his
illegitimate child. Is the court correct in dismissing the petition? ANS: No, the court
is not correct. While an illegitimate father, like X, is not granted by law parental
authority, it is still possible for X to exercise parental authority over his illegitimate
child in view of the peculiar situation in this case. Here, X was the actual custodian

11
 of A. Hence, if the allegation of X that Y and her parents are unfit to exercise
parental authority over A, then X will be entitled to exercise substitute parental
authority over A pursuant to Article 216 of the Family Code, in case of default of
the child’s mother and maternal grandparents. As such, the trial court committed
an error when it did not afford X the right to substantiate his allegations.

29) Jiro is a child of a Filipino mother, Helen Valdez, and a Japanese father, Ubi
Honda. When Jiro was ten years old, his parents divorced in Japan. Thereafter,
Jiro’s mother contracted another marriage to another Japanese national, Yori
Suzuki. After the marriage, Suzuki adopted Jiro in Japan based on Japanese law.
At the age of 24, Jiro filed for judicial recognition of the foreign decree of adoption
before the RTC of Marikina. The RTC dismissed the petition because the adoption
is not in accordance with Philippine laws. The trial court ruled that an adoption is
only valid if made within the legal framework on adoption as enunciated in Republic
Act No. (RA) 8043 known as the Inter-Country Adoption Act of 1995, and RA 8552
known as the Domestic Adoption Act of 1998. Is the RTC correct? ANS: No, the
RTC is not correct because the availability of RA 8552 as a means to adopt Jiro
should not automatically foreclose proceedings to recognize his adoption decree
obtained under Japanese law. The principle behind the recognition and
enforcement of a foreign judgment derives its force not only from our Rules of
Court but from the fact that such act of recognition is considered part of what is
known as the "generally accepted principles of international law.” Besides, the
adoption by an alien of the legitimate child of his/her Filipino spouse is valid and
legal based on the Family Code and the Domestic Adoption Act.

SUCCESSION

30) Conchita was the registered owner of two parcels of land. Upon her death in 1980,
she was survived by her husband, Arturo, and their five children: Remegio,
Victoria, Dionisia, Pacita and Rodrigo. In 1985, Rodrigo also died, survived by his
widow, Josefina, and child, Zenaida. In 1990, Arturo and his four surviving children
executed an extrajudicial partition. After the partition, Dionisia sold her inheritance
to the daughters of Victoria (collectively referred to as the “Navarro siblings”). In
2010, the heirs of Rodrigo (Josefina and Zenaida) filed a complaint for the
annulment of the extrajudicial partition of Conchita’s estate on the ground that they
were left out in the partition of said estate. Only the Navarro siblings filed their
Answer. They sought the dismissal of the complaint on the ground of prescription
and for failure to establish the status of Zenaida and Josefina as heirs of Conchita
in a special proceeding. Will the action prosper despite the lack of a prior and
separate judicial declaration of heirship in relation to the estate of Conchita? ANS:
Yes, the action will still prosper. In Treyes v. Larlar, the Court en banc ruled that
unless there is a pending special proceeding for the settlement of the decedent's
estate or for the determination of heirship, the compulsory or intestate heirs may

12
 commence an ordinary civil action to declare the nullity of a deed or instrument
and for recovery of property, or any other action in the enforcement of their
ownership rights acquired by virtue of succession, without the necessity of a prior
and separate judicial declaration of their status as such. However, the Court further
ruled that the ruling of the trial court shall only be in relation to the cause of action
of the ordinary civil action, i.e., the nullification of a deed or instrument and
recovery or reconveyance of property, which ruling is binding only between and
among the parties.

31) In Question No. 30, are the complainants Josefina and Zenaida entitled to a share
in the estate of Conchita? ANS: Yes, because, as legal heirs of Rodrigo, they
inherited the share of Rodrigo in the estate of Conchita. Rodrigo inherited from the
estate of Conchita upon the latter’s death in 1980, together with his 4 siblings and
his father. Thus, the estate of Conchita is to be divided into six equal parts and
Rodrigo inherited one-sixth portion of said estate. Upon Rodrigo’s death in 1985,
his pro indiviso share in Conchita’s estate was automatically inherited by his
surviving legal heirs, the herein complainants (Josefina and Zenaida).

32) In Question No. 30, is the extrajudicial partition of Conchita’s estate made in 1990
valid? ANS: No, the same is void because it excluded the heirs of Rodrigo.
According to jurisprudence, an extrajudicial settlement executed with the intention
to exclude co-heirs of their rightful share in the estate of the deceased is void and
inexistent for having a purpose or object which is contrary to law. Veritably, a deed
of extrajudicial partition executed without including some of the heirs, who had no
knowledge of and consent thereto, is fraudulent and vicious. It has no force and
effect from the beginning as if it had never been entered into and it cannot be
validated either by time or ratification making an action or defense for the
declaration of the inexistence of a contract imprescriptible in accordance with
Article 1410 of the Civil Code.

33) In Question No. 30, is the sale made by Dionisia in favor of the Navarro siblings
valid? ANS: Yes, the sale is valid notwithstanding the fact that the partition of
Conchita’s estate is null and void. This is because Dionisia already acquired her
successional right to the estate of Conchita upon the latter’s death, equivalent to
one-sixth undivided portion of the said estate. Hence, she became a co-owner of
Conchita’s estate owning one-sixth undivided portion thereof. As a co-owner, she
can freely sell her undivided share to the Navarro siblings even prior to the actual
partition of the estate.

34) Perpetua, a cripple and illiterate, sought the assistance of Atty. Tiburcio to draft
her will. When the draft was finished, Atty. Tiburcio read the contents of the will,
written in the Tagalog dialect, to Perpetua and to her three witnesses (Juan, Pedro,
and Mario). After reading the will, Atty. Tiburcio explained its effects and
consequences to Perpetua while the three witnesses were also listening. After

13
 explaining the contents of the will, Atty. Tiburcio asked Perpetua if she understood
the contents of the will, to which Perpetua replied in the affirmative. Atty. Tiburcio
also asked Perpetua if the contents of the will read to her were in accordance with
her wishes, to which Perpetua replied again in the affirmative. Thereafter, Perpetua
affixed her thumbprint to the will on top of her printed name, in the presence of the
lawyer and the instrumental witnesses. The witnesses also affixed their signatures
in the presence of each other, the testator and the lawyer.

Q: Is Article 808, requiring the reading of the will twice, once by one of the
witnesses and again by the notary public, applicable to an illiterate testator? ANS:
Yes, jurisprudence extended the application of Article 808 to cover not just the
blind but also illiterates. (Guia v. Cosico, Jr., G.R. No. 46997, May 5, 2021)

35) In Question No. 34, is the will valid? ANS: Yes, the will is valid because there was
substantial compliance with the requirements of the law. According to
jurisprudence, the requirements of Article 808 are not required to be complied with
literally. Instead, the law permits of substantial compliance. Article 808 is meant
to protect the testator from all kinds of fraud and trickery but is never
intended to be so rigid and inflexible as to destroy testamentary privilege. In
this case, the danger that Article 808 is designed to prevent is undoubtedly non-
existent. Hence, the will is valid.

36) When to apply the rule of substantial compliance under Article 809 of the Civil
Code in case a fact required to be stated in the attestation clause is omitted: (1) If
proof of compliance is supplied anywhere in the instrument and there is no need
to resort to extrinsic evidence, the rule of substantial compliance applies, such as
when the total number of pages is not stated in the attestation clause but stated in
the acknowledgment; (2) But if proof of compliance is NOT supplied by the
instrument itself and there is a need to resort to extrinsic evidence to prove
compliance, such as when the attestation clause failed to state that the testator
and the witnesses signed in each other’s presence, the rule of substantial
compliance cannot apply.

37) Scarlett Johansson, an American citizen but temporarily residing in the Philippines,
executed her will in the Philippines. She designated Ruben, a Filipino citizen, as
her executor. Upon her death, the executor filed a petition for the probate of the
will before the RTC of Quezon City. The RTC dismissed the petition for lack of
jurisdiction. The RTC reasoned that being an American citizen, the testator’s
national law must govern and her will must be probated in the United States of
America, and not in the Philippines. Is the court correct? ANS: No, the Philippine
law will apply by default. The nationality principle is not applied when determining
the extrinsic validity of an alien's last will and testament. When it comes to the
probate of an alien's will, whether executed here or abroad, the alien's national law
may be pleaded and proved before the probate court. Otherwise, Philippine law

14
 will govern by default. Article 817 of the Civil Code provides an option to the heirs
or the executor: to use Philippine law, or plead and prove foreign law. Thus, it does
not remove jurisdiction from the Philippine court. Consequently, if an alien-
decedent duly executes a will in accordance with the forms and solemnities
required by Philippine law, barring any other defect as to the extrinsic validity of
the will, the courts may take cognizance of the petition and allow the probate of the
will.

38) Anne Locsin, a former Filipino citizen who became a naturalized American citizen,
executed her will in California where she nominated her Filipino cousin, Victor, as
special independent executor over her assets in the Philippines. The will only had
two witnesses; the testator and her witnesses did not acknowledge the will before
the notary public; the will did not state the total number of its pages; and the
witnesses did not sign on all pages. After her death in California, Victor filed for the
probate of the will in the Philippines and prayed that he be appointed as special
administrator of Anne’s estate. Angel, Anne’s sister, opposed the petition. Victor
failed, however, to prove the law of California on formalities required in the
execution of wills. May the will of Anne be allowed in the Philippines? ANS: No,
the will of Anne is void. Since Victor failed to prove the law of California, the
doctrine of processual presumption applies. Pursuant to said doctrine, the validity
of the will as to formalities shall be determined by applying Philippine laws.
Applying Philippine laws, the will is clearly void because it failed to comply with the
mandatory requirement of at least three witnesses. In addition, the witnesses did
not sign on each and every page of the will; the attestation clause failed to state
the total number of pages; and the testator and the witnesses did not acknowledge
the will before a notary public.

39) Important reminders on probate of wills: (1) It becomes mandatory when the will
contains disposition of estate (properties). (2) Generally limited to 4 issues
affecting the extrinsic validity of wills: (i) whether will presented is the last will and
testament of the decedent; (ii) testamentary capacity; (iii) compliance with
formalities; and (iv) genuineness and due execution. (3) As to said 4 issues, the
judgement of probate court is res judicata. (4) Generally, the probate court cannot
pass upon issues involving the intrinsic validity of wills. (5) Exceptions as to when
the probate court may resolve issues affecting intrinsic validity: (i) if the issue of
intrinsic validity concerns an invalid testamentary disposition and such invalidity is
patent on the face of the will; (ii) if the issue of intrinsic validity will determine the
necessity of conducting the probate proceeding. (6) Examples of second
exception: (i) if instrument presented for probate is captioned donation mortis
causa but it is claimed by the oppositors to be a donation inter vivos, such issue
even if intrinsic must be resolved first because it will determine the necessity of
conducting the probate proceeding; (ii) if preterition is claimed to exist and the will
consists purely of institution of heirs, the issue of preterition must be resolved first
because it will determine the necessity of conducting probate. BUT: if preterition is

15
 claimed and there are devises and legacies in the will, the issue of preterition will
not determine the necessity of conducting the probate; hence, the probate court
may not resolve issue of preterition.

40) Important reminders on revocation of wills by physical destruction: (1) As to

requisites: (i) testamentary capacity at the time of revocation; (ii) intent to revoke
(animus revocandi); (iii) intent to revoke must actually be carried out – there must
be over act of physical destruction; (iv) overt act is a completed act insofar as
testator is concerned. (2) Example: testator tore the will into two pieces and as he
was about to tear it more, he was prevailed upon not to continue and he listened.
The will is not revoked because the testator had a change of mind. Act is not
completed. But if after tearing the will into two the testator threw it in the garbage
bin, the will is already revoked because the act was completed, insofar as the
testator is concerned. (3) If physical destruction is done thru an agent: (i) it must
be pursuant to express order or instruction of testator; and (ii) physical destruction
must be done in his presence.

41) Important reminders on preterition: (1) there must be a will - because the concept
refers to omission in the will. (2) the one omitted is a compulsory heir in the direct
line – hence omission of surviving spouse in the will is not preterition (but will
produce the effect of invalid disinheritance); (3) omission must be total or complete;
hence, (i) omitted compulsory heir did not receive donation inter vivos; and (ii)
entire estate is disposed of to the exclusion of omitted compulsory heir – if entire
estate is not disposed of, there is no preterition. (4) omission must not be deliberate
or intentional; otherwise, it will be a case of invalid disinheritance. (5) effect of
preterition: (i) only the institution of heirs is annulled entirely; (ii) but the devises
and legacies will remain valid if not inofficious. (6) effect of invalid disinheritance:
(i) institution of heirs is not annulled entirely, even if entire estate is disposed of;
(ii) if entire estate is disposed of, institution of heirs will be annulled only to the
extent that it prejudiced the legitime of invalidly disinherited heir.

42) Important reminders on conditional testamentary disposition: (1) there are only two
impositions that may validly affect the legitime: (i) prohibition against partition of
estate, including legitime, for a period not exceeding 20 years; (ii) to keep family
business intact, it can be given to one of the children in partition inter vivos and
order payment of legitime of other children in cash. (2) prohibition against
alienation of inheritance for a period not exceeding 20 years can only be imposed
upon disposable free portion but not to the legitime. (3) An absolute condition not
to marry is an impossible condition, deemed not imposed. But a relative prohibition
(relative as to person, period and place) is valid condition, but it can be imposed
only upon the disposable free portion. If imposed upon the legitime, it is deemed
not made. (4) A prohibition imposed upon the spouse not to contract remarriage is
valid if imposed by the deceased spouse, or by ascendants or descendants of the
deceased spouse. But can be imposed only upon the disposable free portion. It

16
 cannot be imposed upon the legitime; otherwise, it is deemed not made. (5)
Dispocision captatoria: (i) there is a condition imposed upon the disposition; (ii)
condition is that an heir, devisee or legatee must also make some disposition in
his will in favor of the testator or any other person; (iii) disposition itself is void, not
only the condition.

43) Sample problem on testamentary succession: The testator executed a will where
the only provision is that he wanted a sum of money in the amount of P500,000 to
be taken from his estate and to be used for prayers and pious works for the benefit
of his soul. At the time of his death, he left an estate valued at P1.2 Million. He was
survived by his spouse, 4 legitimate children, and 2 illegitimate children.

Q1: Is the disposition valid? ANS: Yes, Art. 1029 allows the institution of the
testator’s soul. The testator can dispose of his estate or a portion of it for prayer
and pious works for the benefit of his soul.

Q2: Is there preterition? ANS: There is none, because the compulsory heirs are
not totally omitted. They are not totally omitted because the testator did not dispose
of the entire estate to their exclusion.

Q3: Distribute the estate. ANS: The legitimes of the compulsory heir cannot be
impaired. Hence, their legitimes must be satisfied first. The legitime of the 4
legitimate children is ½ of the estate, or P600,000. Hence, each legitimate child
will be entitled to P150,000 as his legitime. The legitime of the surviving spouse is
the same as the share of each legitimate child, hence, P150,000. The legitime of
each illegitimate child is one-half of the share of each legitimate child, hence,
P75,000 each. Thus, the total of the legitimes of all compulsory heirs amounted to
P900,000. After satisfying the legitimes of all compulsory heirs, the portion of the
estate that can be disposed freely by the testator is P300,000 only. Consequently,
the testamentary disposition of the testator impairs the legitime of the compulsory
heirs up to P200,000. As such, it must be reduced to P300,000.

44) On the right of the surviving spouse to inherit: (1) If the marriage is void, the
surviving party is not entitled to successional right because the parties are not
husband and wife and the absolute nullity of the marriage can still be raised during
the settlement of the estate of the deceased spouse. (2) If there is a decree of legal
separation, there is no need to disinherit the offending spouse because the latter
is already disqualified to inherit by intestate and compulsory successions. As to
the testamentary disposition already made in favor of the offending spouse, the
same is revoked by operation of law. (3) If after legal separation, the spouses
reconciled and obtained a decree of reconciliation: (i) the testamentary disposition
previously revoked by operation of law is automatically revived; (ii) the right of the
offending spouse to legitime and to inherit as legal heir is also automatically
restored; (iii) the disinheritance already made is rendered ineffective; and (iv) there

17
 is no need for a pardon or condonation in writing. (3) As to whether a condition can
be validly imposed upon the inheritance of the surviving spouse: (i) as to the
legitime, no condition can be validly imposed upon it except prohibition against
partition for a period not exceeding 20 years; (2) as to the share of the spouse as
voluntary heir, devisee or legatee, it can be validly subjected to a condition, and/or
prohibition against alienation for a period not exceeding 20 years. (3) as to the
share of the spouse as voluntary heir, devisee or legatee, he/she can be validly
prohibited from contracting another marriage upon the death of the testator-
spouse.

45) Simple problem in intestate succession: The surviving spouse concurring with
legitimate children and illegitimate children. Important rules: (i) share of the spouse
is same as share of each legitimate child; (ii) share of a legitimate child (and
surviving spouse) is double than share of each illegitimate child; (iii) share of each
illegitimate child is ½ of the share of each legitimate child; (iv) but there shall be no
impairment of the legitime of the legitimate children. Example: Estate is P1.2
Million. 2 legitimate children, surviving spouse and 2 illegitimate children.
Distribution shall follow the formula: 2:2:2:1:1. Hence, divide estate into 8 parts,
one part is P150,00. P150,000 is the share of each illegitimate child. P300,000 is
the share of each legitimate child and the surviving spouse. Here, there is no
impairment of the legitime of the legitimate children. Another example: Estate is
P1.2 Million, 2 LC, SS and 4 ILC. If we are to follow the formula: 2:2:2:1:1:1:1, the
estate is to be divided into 10 parts and one part is P120,000. The total shares of
2 LC is P480,000, which is less than half of the estate. Hence, their legitime is
impaired. We cannot follow this formula. Instead, return their legitimes. That will
also be their shares in intestate succession.

46) Simple problem in intestate succession: Surviving spouse concurring with brother,
sister, nephew or niece of the decedent. Important rules: (i) share of SS is ½ of
estate; (ii) share of group of B/S/N/N is also ½ of estate; (iii) a nephew or niece
can represent deceased parent, if he/she is inheriting together with an uncle or
aunt. Example 1: Estate is P1.2 Million. Legal heirs are: SS, 1B, 1S, and 1N (a
child of deceased brother). Share of SS is P600,000. The other half is divided
equally among B, S and N (P200,000 each), with the latter inheriting by right of
representation. Example 2: Estate is P1.2 Million. Legal heirs are: Surviving
spouse and 6 nephews and nieces, children of deceased brothers and sisters.
Share of SS is P600,000. The other half is divided equally among the 6 nephews
and nieces (P100,000 each), who will be inheriting in their own right.

47) Sample problem in intestate succession: If the legal heirs are brothers, sisters,
nephews and nieces, important rules: (1) Apply barrier rule: those who can inherit
from the deceased brother or sister are only those with same status. If decedent
is legitimate, only the legitimate brothers, sisters, nephews and nieces can inherit.
If decedent is illegitimate, only those who are also illegitimate can inherit from him

18
 or her. (2) If some full blood, some half blood: Share of full blood is double than
share of half blood. (3) Nephews and nieces are entitled to represent their
deceased parent, if they will be inheriting together with brothers and sisters of the
deceased. (4) If only nephews and nieces are the heirs, they will inherit in their
own right. (5) Any brother, sister, nephew or niece, will exclude the other collateral
blood relatives in intestate succession.

Sample problem: Estate is P1.6 Million. Decedent is legitimate, survived by: 2 full
blood brothers, a nephew (who is child of a deceased legitimate full blood brother),
2 half blood sisters and 1 illegitimate brother. The illegitimate brother cannot inherit
because of the barrier rule. The full blood nephew will inherit by right of
representation. The shares of the full blood brothers and nephew will be double
than the share of the half blood sisters. Hence, formula is: 2:2:2:1:1. Estate is to
be divided into 8 equal parts, with one part equivalent to P200,000. Therefore,
share of each half blood sister is P200,000. Share of each full blood brother and
also the full blood nephew is P400,000.

OBLIGATIONS & CONTRACTS, SALE, TORTS AND DAMAGES, and OTHERS….

48) Oral Sale of Parcel of Land: (1) An oral sale of parcel of land is valid. (2) Sale of
parcel of land is covered by Statute of Frauds: (i) if oral sale of parcel of land is still
purely executory (no performance yet), defense of SOF is applicable; hence, the
contract is unenforceable. (ii) but if oral sale of parcel of land is partly or completely
executed, defense of SOF is no longer applicable; hence, sale is already
enforceable. (3) If oral sale of parcel of land is already enforceable, the buyer can
compel the seller to reduce the contract in a public document pursuant to Article
1357.

49) Contract of Sale and Contract to Sell - How to determine: According to Justice
Caguioa in Agustin v. De Vera: (1) Not controlling: While a stipulation or promise
to the effect that a seller shall execute a deed of sale upon the completion of
payment of the purchase price by the buyer may be considered a factor or a sign
that a contract might possibly be a contract to sell, such stipulation in itself, taken
in isolation, is by no means determinative and conclusive as to the contract being
a contract to sell. (2) Controlling test: Still controlling are (1) the lack of any
stipulation in the sale contract reserving the title of the property on the vendors and
(2) the lack of any stipulation giving the sellers the right to unilaterally rescind the
contract upon non-payment of the balance thereof within a fixed period. The
absence of such stipulations in a sale contract makes the said contract a contract
of sale. If any of those stipulation is present, the contract is merely a contract to
sell.

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50) Distinctions in Contract of Sale and Contract to Sell: (1) In COS, title passes to the
buyer upon delivery of the thing sold; in CTS (or of "exclusive right and privilege
to purchase"), the ownership is reserved in the seller and is not to pass until the
full payment of the purchase price is made. (2) In COS, nonpayment of the price
is a negative resolutory condition; in CTS, full payment is a positive suspensive
condition. (3) In COS, the vendor has lost and cannot recover the ownership of the
land sold until and unless the contract of sale is itself resolved and set aside (or
rescinded). In CTS, however, the title remains in the vendor if the vendee does not
comply with the condition precedent of making payment at the time specified in the
contract. Hence, when the seller, because of noncompliance with the suspensive
condition stipulated, seeks to eject the buyer from the land object of the agreement,
said vendor is enforcing the contract and is not resolving the same. In CTS, upon
default by the buyer, there is no need to rescind because such failure to pay the
price is simply an event that prevented the obligation of the vendor to convey title
from acquiring binding force.

51) Effect of Payment of earnest money: (1) Earnest money, under Article 1482 of the
Civil Code, is ordinarily given in a perfected contract of sale. However, earnest
money may also be given in a contract to sell. (2) If there is no reservation of
ownership until full payment of the price, the contract is a contract of sale and
payment of earnest money is proof of its perfection. (3) However, if there is
reservation of ownership until full payment of the price, the contract is a contract
to sell. In a contract to sell, earnest money is generally intended to compensate
the seller for the opportunity cost of not looking for any other buyers.

52) Article 1592 on sale of immovable property: (1) Article 1592 contemplates: (i)
a contract of sale of an immovable property (not applicable to contract to sell); and
(ii) there is a stipulation in the contract that failure to pay the price at the time
agreed upon will cause the rescission of the contract. (2) The vendee or the buyer
can still pay even after the time agreed upon, if the agreement between the parties
has these requisites. In fact, an offer to pay by the buyer will already defeat the
seller’s right to rescind the contract. (3) This right of the vendee to pay ceases
when the vendor or the seller demands the rescission of the contract judicially or
extrajudicially. (4) In case of an extrajudicial demand to rescind the contract, it
should be notarized. (5) The notarial act must be acknowledgement.

Articles 1592 and 1191 are not applicable to a contract to sell because if the price
is not paid within the period agreed upon, such failure is not a breach, casual or
serious, but simply an event that prevented the obligation of the vendor to convey
title from acquiring binding force. Hence, there is no obligation yet that can be
rescinded. There is nothing to rescind.

53) Double Sale: (1) Requisites for double sale to exist: (i) there must be two or more
valid sales – both contracts must be contracts of sale; if one is contract to sell (no

20
 sale yet), there is no double sale; (ii) same thing sold or same subject-matter; (iii)
two different buyers who do not share same interest; and (iv) seller must be same
person and at time of second sale, seller is still owner of thing sold; otherwise,
there is no double sale. (2) Rules on double sale over immovable property
registered under Torrens System: (i) first to register sale in good faith, enjoys
preference – second seller must have no knowledge of first sale prior to
registration, otherwise registration is not in good faith; but knowledge gained by
the first buyer of the second sale prior to registration does not prevent first buyer
from registering in good faith; (ii) in the absence of registration, the first to take
possession in good faith; (iii) in the absence of registration and possession, the
one who can present the oldest title. (3) Rule on double sale over movable
property: preference is given to the first to take possession in good faith. (4) Rule
on double sale over unregistered lands: (1) If first sale is recorded, the same is
constructive notice to second buyer. Hence, second buyer cannot claim good faith.
(2) If first sale is unrecorded but buyer already took possession and exercised
rights of ownership, the registration of second sale does not give second buyer
preference because “registration under Act 3344 or Sec. 113 of PD 1529 is without
prejudice to better right.” (3) But if in the unrecorded first sale, the buyer has not
yet exercised acts of ownership, the registration of the second sale will give the
second buyer better right.

54) MACEDA Law: (1) Applicability: Applicable to sale of real property on installments,
except: (i) sale of industrial lots; (ii) sale of commercial buildings; and (iii) sale to
tenants. The law does not apply to purchase of land by those engage in real estate
business because it is not for residential purpose, but for commercial or business
purposes. (2) If buyer was able to pay installments for less than 2 years, only right
is to avail of grace period: (i) grace period is minimum of 60 days; (ii) contract may
only be cancelled after grace period and payment is not updated; (iii) notice of
cancellation must be by way of notarial act; and (iv) cancellation takes effect 30
days from receipt of notice of cancellation by notarial act. (3) If buyer was able to
pay installments for at least 2 years: (i) entitled to grace period of 1 month for every
year of payment; (ii) contract may only be cancelled after grace period and
payment is not updated; (iii) for cancellation to be valid, two requisites must be
satisfied: notice of cancellation must be by way of notarial act and payment of cash
surrender value; otherwise, contract is still subsisting. (4) cash surrender value: (i)
at least 50% of total payments; (ii) but after 5 years of installment payments,
additional 5% for every year after 5 years, but not to exceed 90%. (5) meaning of
“at least 2 years of payments”: it does not refer only to time without regard to value,
but it refers to time and value. Hence, if installment is paid on monthly basis, at
least 2 years of payments refer to an aggregate of “least 24 monthly installments.”
(6) meaning of notarial act: it refers to acknowledgment and not a mere jurat.

55) Prescriptive period of action based on solutio indebiti: (1) An action based on
quasi-contract, such as solutio indebiti prescribes within 6 years. (2) An action

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 based on written contract prescribes within 10 years from accrual of cause of
action. (3) Requisites of solutio indebiti: (i) payment is by reason of mistake of fact
or mistake in doubtful or difficult provision of law; and (ii) there must be no binding
relation between the parties.

56) Problem: Lessor increased the yearly rentals. Lessee paid the increased rents
under protest. Ten years after, the court declared invalid the increase in rent for
failure of lessor to comply with the required procedures upon a petition filed by the
other lessees in the same establishment. Lessee immediately filed an action to
recover the overpayments it made for the past 10 years. The court ruled that the
cause of action is based on solutio indebiti; hence, some amounts may no longer
be recovered because the prescriptive period for recovery is 6 years only. Is the
court correct? ANS: No, the court is not correct. The cause of action for recovery
of payment is based on the violation of the written contract of lease; hence, the
prescriptive period is 10 years from overpayment. The cause of action cannot
possibly arise from solutio indebiti because the requisites of solutio indebiti are the
following: (i) payment is by reason of mistake of fact or mistake in doubtful or
difficult provision of law; and (ii) there must be no binding relation between the
parties. Here, the parties are bound by the contract of lease.

57) Effect of Interruption of Prescriptive Period: The prescription of actions is

interrupted: (i) when they are filed before the courts; (ii) when there is a written
extrajudicial demand by the creditors; or (iii) when there is any written
acknowledgment of the debt by the debtor. This interruption wipes out the period
that already elapsed and starts a fresh prescriptive period.

Problem: On September 1, 2003, Dyan executed a Deed of Sale in favor of Alex

over a house and lot. Alex paid 80% of the price and the balance is payable when
Dyan vacated the premises which shall not go beyond December 31,2003. After
the sale, a third party filed an action against Dyan and Alex for recovery of the
property. On February 1, 2008, a compromise agreement was executed between
the parties where the complainant respected the sale between Dyan and Alex. On
March 1, 2015, Alex sent a demand letter upon Dyan for the delivery of the
property. When the demand remained unheeded, Alex filed on April 15, 2017 a
complaint for the delivery of the property to him. In her answer, Dyan claimed that
the cause of action of Alex is based on a written contract of sale; hence, the
prescriptive period is 10 years from accrual of the cause of action. Dyan argued
that the cause of action of Alex accrued on January 1, 2004 when Dyan was
supposed to vacate the premises. Since the action was filed more than ten years
from January 1, 2004, the action had already prescribed. Is Dyan correct? ANS:
No, the action was filed within the prescriptive period. While it is true that the cause
of action of Alex accrued on January 1, 2004, there was, however, an interruption
of the prescriptive period when the parties executed a compromise agreement on
February 1, 2088. Under the law, the prescription of actions is interrupted, among

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 others, by a written acknowledgment of the debt by the debtor. This interruption
wiped out the period that already elapsed and started a fresh prescriptive period
from February 1, 2008 to to February 1, 2018. Hence, when the action was filed
on April 15, 2017, the same is well within the fresh prescriptive period.

58) On June 3, 2018, Zenaida Estonactoc executed a real estate mortage in favor of
Atty. Bulatao to secure a loan in the amount of P200,000. The mortgage contract
provides that the loan, together with the interest at the rate of five percent (5%) per
month, must be paid within a period of twelve (12) months or one (1) year or before
June 4, 2019. When Zenaida defaulted in her obligation, Atty. Bulatao foreclosed
the mortgage by way of extra-judicial foreclosure. The foreclosure was based on
a demand for payment issued by Atty. Bulatao in the amount of P540,000,
representing principal and interest at the rate of 5% per month.

Q1: Is the rate agreed upon valid? ANS: No, because the rate imposed is
unconscionable and excessive. The imposition of an unconscionable rate of
interest on a money debt, even if knowingly and voluntarily assumed, is void for
being contrary to morals and the law. Given that the agreement on the 5% monthly
interest is void for being unconscionable, the legal rate of interest for loans or
forbearances of money will be the substitute rate not only for the one-year interest
period agreed upon but for the entire period that the loan of Zenaida remains
unpaid. However, the invalidity of the 5% per month interest rate does not affect
the obligation of Zenaida to repay her loan of P200,000.00 from Atty. Bulatao. The
applicable interest is the BSP-prescribed rate of 6% per annum from the execution
of the mortgage contract on June 3, 2018 until full payment.

Q2: Is the foreclosure of the mortgage valid? ANS: No, because the debtor is not
yet in default. Since the interest rate imposed is void, the non-payment of the
principal loan obligation does not place the debtor in a state of default. This is
because under Article 1252 of the Civil Code, if a debt produces interest, payment
of the principal shall not be deemed to have been made until the interests have
been covered. Necessarily, since the obligation of making interest payments in the
instant case is illegal and thus non-demandable, the payment of the principal loan
obligation was likewise not yet demandable on the part of the creditor. With
Zenaida not being in a state of default, the foreclosure of the subject property
should not have proceeded.

59) Monetary and Compensatory Interest: (1) Kinds of interest: Interest as a

compensation fixed by the parties for the use or forbearance of money is referred
to as monetary interest; while interest that may be imposed by law or by courts
as penalty for damages is referred to as compensatory interest. (2) The interest
referred to in Article 1956 of the Civil Code is monetary interest. In order for the
obligation to pay monetary interest to become a civil obligation, two requisites must
be satisfied: (i) (there was an express stipulation for the payment of interest; and

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 (ii) the agreement for the payment of interest was reduced in writing. If the
agreement to pay monetary interest is made verbally, it is only a case of natural
obligation. (3) Modification of Eastern Shipping and Nakar ruling: In Eastern
Shipping and Nakar, it was held that from the finality of the judgment until its
satisfaction, the legal rate of 6% p.a. shall apply because such interim period is
deemed equivalent to “forbearance of credit.” But in Lara’s Gift & Decors, Inc. v.
Midtown Industrial Sales, the Court ruled that it is the stipulated rate that should
apply (unless the rate agreed upon is excessive or unconscionable) until full
payment of the obligation, including the interim period of finality of judgment up to
its satisfaction. This is because the rate agreed upon is the law between the
parties.

60) Studio 21, owned by Jose, is renting the entire second floor of a two-storey
building; while the first floor is rented by Copylandia. When Jose made renovations
in the second floor on April 1, 2015, including the building’s piping system, a water
leaked occurred and damages Copylandia’s various equipment on the ground floor
in the amount of P2,514,000. As the equipment were insured with UCPB General
Insurance Co., Inc. (UCPB), Copylandia filed a claim with the latter. The
negotiations between the two lasted until December 1, 2018 when finally
Copylandia agreed to a settlement in the amount of P1,600,000. As subrogee of
Copylandia, UCPB filed a complaint for damages against Jose for recovery of P1.6
Million on May 15, 2019. Will the action still prosper? ANS: No, the action was filed
beyond the 4-year prescriptive period allowed for causes of action based on quasi-
delict. The cause of action of Copylandia against Jose is based on quasi-delict,
which has a prescriptive period of 4 years from the accrual of cause of action. The
cause of action of Copylandia accrued on April 1, 2015. Hence, it has until April 1,
2019 within which to file the action. Considering that UCPB is merely subrogated
to the rights of Copylandia, it inherits only the remaining period within which the
insured may file the action against the wrongdoer. Here, the action was filed by
UCPB after the lapse of the 4-year prescriptive period.

61) Novation: In lease, the assignment of the lease contract involves novation by
substitution of the person of the debtor. In such kind of novation, the consent of
the creditor is necessary.

Problem: In 1997, Food Fest Land, Inc. rented the parcels of land owned by
Sapnio. The term of the lease is for 15 years. There is a clause in the contract
which states that “No waiver by the parties of any of their rights under this
Contract of Lease shall be deemed to have been made unless expressed in
writing and signed by the party concerned.” Pursuant to the contract (FFLI) built
and operated its restaurant on the property. In 1998, FFLI assigned the contract
to Tucky Foods, Inc. (TFI). In 2001, TFI assigned the contract to Joyfoods Corp.
(JFC). The annual rental escalation clause was observed and paid during the first
five years. But beginning the 6th year up to 10th year, the rental escalation clause

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 was not followed. Hence, on the 11th year, Sapnio called the attention of FFLI and
JFC regarding its intent to enforce the rental escalation clause for the said year.
On the 12th year, JFC pre-terminated the contract allegedly due to business losses.
Sapnio filed an action for collection of unpaid rentals against FFLI and JFC,
representing the sum due from the escalation for the years 2007 and 2008. The
trial court held FFLI and JFC liable to pay the unpaid rentals. FFLI appealed
arguing that it is not liable because there was already novation when it assigned
the contract of lease to TFI and the latter assigned the contract to JFC. Is FFLI
correct? ANS: No, there was no novation by substitution of the person of the debtor
because the creditor did not give his consent to the substitution. Under the contract
of lease, the consent of the lessor to the substitution must be made expressly in
writing pursuant to the non-waiver clause of the contract. The lessor’s consent to
the substitution of the lessee falls within the ambit of the foregoing clause, because
a novation by the substitution of the person of the debtor implies a waiver
on the part of the creditor of his right to enforce the obligation as against the
original debtor. In addition, the consent of the lessor to the substitution of FFLI
cannot be deduced or implied from any of the established acts of the former. The
consent of the lessor to the substitution of FFLI by JFC cannot be presumed from
the sole fact that the lessor accepted payments from JFC. It is well settled that
mere acceptance by a creditor of payments from a third person for the benefit of
the debtor, sans any agreement that the original debtor will also be released from
his obligation, does not result in novation but merely the addition of debtors.

62) Tortious interference: Elements of tortious interference: (1) existence of a valid

contract; (2) knowledge on the part of the third person of the existence of contract;
and (3) interference of the third person is without legal justification or excuse.
According to jurisprudence, as long as a proper economic or financial interest
exists the third person cannot be held liable for tortious interference.

Problem: Under the Talent Agreement, GMA agreed to provide Cruz-Valdes shows
where she could work as a talent and pay her talent fees. For her part, Cruz-Valdes
had to work as a talent in GMA’s shows, and was also prohibited from doing certain
things under the Talent Agreement. Paragraph 4 prohibited her from rendering
services to any other production without GMA's prior written consent. Through a
letter dated October 15, 2019, Cruz-Valdes tendered her resignation to GMA.
Upon receiving the resignation letter, GMA advised Cruz-Valdes to avail her
terminal leave and told her that she no longer needed to report to work. GMA also
replaced her in the programs she hosted and she was also asked to turn over
company properties. GMA also stopped paying her talent fees. However, on
November 8, 2019, Cruz-Valdes received a letter from GMA's counsel informing
her that her resignation breached the Talent Agreement. On November 15, 2019,
ABS-CBN hired Cruz-Valdes as its Vice President for News. Thereafter, GMA
sued ABS-CBN for damages on account of tortious interference under Article 1314
of the Civil Code. Will the action prosper? ANS: No, the action will not prosper.

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 According to jurisprudence, the elements of tortious interference: (1) existence of
a valid contract; (2) knowledge on the part of the third person of the existence of
contract; and (3) interference of the third person is without legal justification or
excuse. In the case at bar, the first element is lacking. When the supposed
interference took place, GMA had already asked Cruz-Valdes to go on terminal
leave, required her to surrender company properties, cut off her access to her
company email, and replaced her with other talents on her shows. By doing so, it
prevented her from complying with her obligations under the Talent Agreement. In
short, GMA had already unilaterally terminated the contract. In addition, the third
element is lacking. According to jurisprudence, as long as a proper economic or
financial interest exists, the third person cannot be held liable for tortious
interference. Here, ABS-CBN had been in need of a news executive who could
train employees and supervise its news department. Thus, engaging Cruz-Valdes
as its Vice President for News was necessary to improve ABS-CBN’s level of
competence.

63) Void Contract: The Spouses Teodulo and Dominga Natividad were coerced in
2003 by their eldest child, Danilo, to sign a Deed of Absolute Sale. They initially
refused because the property was intended for Danilo's siblings for their eventual
study in Manila. Because of their refusal, Danilo angrily shouted and threw a
briefcase at his father but missed. Out of fear, the spouses signed the Deed even
without receiving any payment as consideration. Danilo was able to have the deed
notarized even if the spouses did not personally appear before the notary public.
By virtue of the said deed, Danilo was able to transfer the property into his name
and to that of his wife also in 2003. In 2013, the spouses Natividad filed an action
for the or reconveyance of property, nullity of the supposed sale of real property,
and cancellation of the title in the names of Danilo and the latter’s wife. The RTC
dismissed the complaint saying that the plaintiffs’ cause of action had already
prescribed. The RTC explained that when an action for reconveyance is based on
fraud, it must be filed within four (4) years from discovery of the fraud, and such
discovery is deemed to have taken place from the issuance of the original
certificate of title. Is the RTC correct? ANS: No, because the contract is void and
inexistent, hence, the action for declaration of its nullity is imprescriptible. In the
given problem, the contract is absolutely simulated and fictitious because there
was no consideration. While the contract says that the price was paid, in truth and
in fact, it was not paid. Hence, the contract lacks consideration rendering it void or
inexistent. Consequently, the action for the declaration of its nullity is
imprescriptible.

64) Voidable contract: Calvin Genotiva, together with his business colleagues,
ventured into the commercial production of hollow blocks and concrete pavers
under the registered name Goldland Equity, Inc. (Goldland). Goldland applied for
a "clean loan" with BDO at its Cagayan de Oro City Branch where Calvin’s wife,
Violet, was an employee. BDO granted the loan in the amount of P2,000,000.00

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 as evidenced by a Promissory Note. The Spouses Genotiva, together with the
other stockholders of Goldland, executed a Deed of Suretyship in favor of the
Bank. When Violet retired, she requested for the payment of her retirement
benefits and for the release of the owner's copy of the TCT which was retained by
BDO in relation to Violet’s earlier housing loan which loan was already fully paid.
However, BDO refused to release her retirement benefits unless she and her
husband would execute a real estate mortgage over the subject property to secure
Goldland's loan. Being pressed for money, they acceded and signed a real estate
mortgage contract. When Goldland defaulted in its payment of the loan, BDO
foreclosed the subject property and scheduled its auction sale. Subsequently, the
spouses Genotiva filed an action for the annulment of the mortgage contract
contending that it was executed under duress in view of BDO's withholding of
Violet’s retirement benefits. If you were the court, will you annul the contract? ANS:
No, the contract is not annullable because there was no intimidation or threat.
According to jurisprudence, for intimidation to vitiate consent the following
requisites must be proven: (1) that the intimidation must be the determining cause
of the contract, or must have caused the consent to be given; (2) that the
threatened act be unjust or unlawful; (3) that the threat be real and serious, there
being an evident disproportion between the evil and the resistance which all men
can offer, leading to the choice of the contract as the lesser evil; and (4) that it
produces reasonable and well-grounded fear from the fact that the person from
whom it comes has the necessary means or ability to inflict the threatened injury.
In this case, BDO's supposed "threat", i.e., its withholding of Violet's retirement
benefits, is not the intimidation referred to by law because the act is not unjust or
unlawful. The bank was unable to release Violet's clearance for the release of her
retirement benefits for the simple reason that she had an existing liability to the
bank arising from the Deed of Suretyship that she executed with her husband and
other stockholders of Goldland. While the Spouses Genotiva may have reluctantly
signed the mortgage contract, there was no vitiation of consent. They simply
agreed to accept what they thought was a better option.

65) Statute of Frauds; Double Sale: The subject property (a parcel of land) was
originally owned by Vicente Balubal. Upon his death in 1944, the property was
inherited by his two children, Tomasa and Jose Balubal. In 1962, Tomasa and
Jose sold the property to Juan Lacambra. The OCT was delivered to Juan and the
latter took possession of the property. But Juan did not register the notarized sale.
When Juan died in 1979, the property passed to the heirs of Juan by intestacy. In
1980, two of the children of Juan sold their portion (5/14) to Rogelio Tamayao. The
spouses Tamayao constructed their house on the said portion. Thereafter, the
heirs of Balubal told the Tamayaos that they owned the subject property. Fearful
that they might lose their house, the Tamayaos purchase the entire subject
property from the heirs of Balubal. The heirs of Balubal declared the OCT lost and
had it replaced. By reason of the sale between the Balubals and Tamayaos, the
OCT was cancelled and a TCT was issued in the name of Spouses Tamayao. The

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 Heirs of Lacambra filed for the annulment of the sale between the heirs of Balubal
and the Tamayaos and for the declaration of nullity of the reconstituted OCT and
TCT issued to the Spouses Tamayao.

Q1: Is the sale of the land in 1962 to Juan Lacambra by Tomasa and Jose Balubal
a valid sale? ANS: Yes, even a verbal sale of real property is valid subject only to
the requirements of the Statute of Frauds. In this case, the notarized extrajudicial
settlement and sale executed by Tomasa and Jose in 1962 enjoys presumption of
regularity. Therefore, there was constructive delivery of ownership in favor of Juan
Lacambra upon execution of the notarized extrajudicial settlement and sale. In
addition, there was also actual delivery when Tomasa and Jose allowed Juan and
his family to take possession and control of the subject property. The failure to
register the extrajudicial settlement and sale did not affect the validity of the sale
because registration is not essential for the validity of the contract. It is also not a
mode of acquiring ownership.

Q2: Are the Spouses Tamayao innocent purchasers for value? ANS: No, because
they knew of the existence of the prior sale in favor of Juan Lacambra. In fact, they
purchased a portion of the subject property from the heirs of Juan Lacambra. Thus,
they cannot acquire a better right because a buyer can acquire no more than what
the seller can legally transfer.

Q3: Can the Spouses Tamayao rely on Article 1544, or the rule on double sale?
ANS: No, there is no double sale in the given problem because the seller was no
longer the owner at the time of the second sale. According to jurisprudence, the
rule on double sale does not apply when the second sale was made when such
person was no longer the owner of the property, because it had been acquired by
the first purchaser in full dominion. Besides, even if the rule on double sales were
to be applied, the result would still be the same. The heirs of Lacambra would still
have a better right of ownership over the subject property as Spouses Tamayao
failed to acquire and register the sale in good faith.

Q4: Is the reconstituted OCT valid? ANS: No, because reconstitution can be validly
made only in case of loss of the original certificate. According to jurisprudence,
when the certificate of title was not actually lost or destroyed, but is in fact in the
possession of another person, the reconstituted title is void because the court that
rendered the order of reconstitution had no jurisdiction over the subject matter of
the case.

66) Vicarious liability of State: (1) Test of liability: The test of liability depends on
whether or not the employees, acting in behalf of the State, were performing
governmental or proprietary functions. (a) If performing governmental functions,
the State is liable only for the tortuous acts of its “special agents.” (b) If performing
proprietary functions, the State is liable as an ordinary employer. (2) Governmental

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 functions: (a) The State is liable only for the torts committed by its employee when
the latter acts as a special agent but not when the said employee or official
performs his or her functions that naturally pertain to his or her office. (b) A special
agent is defined as one who receives a definite and fixed order or commission,
foreign to the exercise of the duties of his office.

Problem: BPI was defrauded in the amount of P9 Million because of the fraud
perpetuated by employees of the Central Bank’s clearing house, done by way of
tampering with and pilfering of documents passing through the clearing house.
When Central Bank of the Philippines (now BSP) credited only half of the amount
and refused to credit back the balance, BPI filed a complaint for sum of money
against CBP. Is CBP liable for the tortious acts of its employees? ANS: No, CBP
is not liable for the tortious acts of its employees because they were performing
governmental functions when the tort was committed and they did not act as
special agent. The rule is that if the tort is committed by government employees in
the performance of governmental functions, the State is liable only for the torts
committed by its employee when the latter acts as a special agent but not when
the said employee or official performs his or her functions that naturally pertain to
his or her office. In the case at bar, the employees are not considered as special
agents of CBP because they were regular employees performing tasks pertaining
to their offices.

67) Problem: UCPB Leasing and Finance Corp. (ULFC) is the registered owner of an
international trailer harvester truck (truck) and leased to Subic Bay Movers, Inc.
(SBMI). The lease contract was not registered in the LTO. While being operated
by SBMI, through its driver, Almazan, the truck hit the Nissan Sentra car of Leporgo
which, at that time, was in full stop waiting for the traffic to move. The truck also hit
other vehicles, but the car of Leporgo exploded upon impact, causing his death.
The widow of Leporgo filed an action for damages based on quasi-delict against
ULFC, SBMI and Almazan. ULFC denied liability because: (1) it was not the
employer of Almazan; and (2) Section 12 of RA 8556 provides that financing
companies are not liable for injuries or losses caused by a motor vehicle leased to
a third person.

Q1: Is ULFC liable for the death of Leporgo? ANS: Yes, because under the law on
compulsory motor vehicle registration, with respect to the public and third persons,
the registered owner of a motor vehicle is directly and primarily responsible for the
consequences of its operation regardless of who the actual vehicle owner might
be. In contemplation of law, the owner/operator of record is the employer of the
driver, the actual operator and employer being considered as merely its agent.

Q2: Is ULFC exempt from liability under the registered owner rule pursuant to
Section 12 of RA 8556? ANS: No, because ULFC did not register the lease in the
LTO. RA 8556 does not supersede nor repeal the law on compulsory motor vehicle

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 registration. Under the latter law, the lease contract must be recorded in the LTO
to bind third persons. The non-registration of the lease contract between financing
company and its lessee precludes the former from enjoying the benefits under
Section 12 of RA 8556.

Q3: What is the remedy of ULFC? ANS: The remedy of ULFC is to recover from
SBMI, the actual operator. This is because the application of the registered owner
rule does not serve as a shield of the offending vehicle's real owner from any
liability. Under the principle of unjust enrichment, the registered owner who
shouldered such liability has a right to be indemnified by means of a cross-claim
as against the actual employer of the negligent driver.

68) In Question No. 67, Leoporgo was 57 at the time of his death and he was earning
P353,520 annual income. ULFC argued that being a government employee where
the retirement age is 65 years old, 65 years old should be used in computing the
life expectancy and not 80 years old.

Q1: Is the contention of ULFC meritorious? ANS: No, the contention is not
meritorious because The formula for the computation of loss of earning capacity is
meant to be uniformly applied to all, regardless of the industry or sector they work
in. Hence, the court cannot restrict the computation of Leporgo's life expectancy to
(2/3 x [65 – age at death]) simply because the deceased was a government
employee whose mandatory age of retirement is 65 years old. The possibility that
the deceased could have chosen to continue working or making profit through
other means had he not been prevented by his sudden death may not be
disregarded.

Q2: Compute loss of earning capacity. ANS: Formula is [2/3 x (80-57)] x (50% of
P353,520). Thus:

Life expectancy is: 2/3 x 23 = 15.33

50% of annual income is: = P176,760
Net earning capacity is: 15.33 x P176,760
Net earning capacity is P2,709,730.80

69) Moral damages if delict or quasi-delict results into death under Article 2206(3): (1)
can be recovered in addition to indemnity for the death of the victim in the amount
of P50,000 and loss of earning capacity; (2) But only the following are entitled to
recover moral damages: “the spouse, legitimate and illegitimate descendants and
ascendants of the deceased.” (3) Collateral blood relatives, including brothers and
sisters are not entitled. (4) But for the purpose of recovering moral damages under
Article 2206(3), persons exercising substitute parental authority are to be
considered “ascendants.” [Caravan Travel & Tours International, Inc. v. Abejar)

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70) Moral damages in breach of contract: (a) General rule: Moral damages may not be
recovered in breach of contract. (b) Exceptions: (1) in breach of contract of carriage
where the mishap results in the death of a passenger, as provided in Article 1764,
in relation to Article 2206(3) of the Civil Code; and (2) if the party from whom it is
claimed acted fraudulently or in bad faith or in wanton disregard of his contractual
obligations. The breach must be wanton, reckless, malicious or in bad faith, and
oppressive or abusive.

71) Moral damages under Article 309:

Problem: Loreta Tabuada died in 1990. She left a parcel of land registered in her
name. She was survived by her son and only heir, Simeon Tabuada. In 1994,
Eleonor Tabuada, the sister-in-law of Simeon, misrepresented herself as the
deceased Loreta Tabuada and mortgaged the property without the knowledge of
Simeon and the latter’s wife, Sofia Tabuada. The mortgage was in favor of the
Spouses Certeza. In 1997, Simeon died, leaving Sofia and their children as his
heirs. After the death of her husband, Sofia learned of what Eleanor did. Hence,
she filed an action against Eleanor and the Spouses Certeza for the nullification of
the mortgage. The trial court declared the mortgage void on the ground that the
mortgagor was not the absolute owner of the property. The RTC also ruled that
moral damages were proper under Article 309 of the Civil Code based on the
showing of disrespect to the dead. Is the RTC correct in awarding moral damages
to the complainant pursuant to Article 309 of the Civil Code: ANS: No, the RTC
committed an error in awarding moral damages based on Article 309 of the Civil
Code. The Civil Code provision under Article 309 on showing "disrespect to the
dead" as a ground for the family of the deceased to recover moral and material
damages, being under the title of “Funerals”, obviously envisions the
commission of the disrespect during the period of mourning over the demise
of the deceased or on the occasion of the funeral of the mortal remains of
the deceased. Neither was true herein. Hence, the act of Eleanor Tabuada of
fraudulently representing the late Loreta Tabuada did not amount to disrespect to
the dead as basis for the recovery of moral damages.

END

Goodluck barristers! I hope and pray that you will get

a high grade in Civil Law. Amen!

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