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Principle of Abuse of Rights

The principle of abuse of rights is found under Articles 19, 20 and 21


of the Civil Code of the Philippines, which states that:
Art. 19. Every person must, in the exercise of his rights and in the
performance of his duties, act with justice, give everyone his due and
observe honesty and good faith.
Art. 20. Every person who, contrary to law, wilfully or negligently
causes damage to another, shall indemnify the latter for the same.
Art. 21. Any person who wilfully causes loss or injury to another in
manner that is contrary to morals, good customs or public policy shall
compensate the latter for the damage.
The above articles depart from the classical theory that he who uses
a right injures no one. The modern tendency is to depart from the
classical and traditional theory, and to grant indemnity for damages in
cases where there is an abuse of rights, even when the act is not
illicit.
When a right is exercised in a manner which does not conform with
the norms enshrined in Article 19 and results in damage to another, a
legal wrong is thereby committed for which the wrongdoer must be
held responsible. Although the requirements of each provision are
different, these three (3) articles are all related to each other. As the
eminent Civilist Senator Arturo Tolentino puts it: With this article
(Article 21), combined with articles 19 and 20, the scope of our law on
civil wrongs has been very greatly broadened; it has become much
more supple and adaptable than the Anglo-American law on torts. It is
now difficult to conceive of any malevolent exercise of a right which
could not be checked by the application of these articles (Tolentino, 1
Civil Code of the Philippines 72).
There is however, no hard and fast rule which can be applied to
determine whether or not the principle of abuse of rights may be
invoked. The question of whether or not the principle of abuse of
rights has been violated, resulting in damages under Articles 20 and

21 or other applicable provision of law, depends on the circumstances


of each case. (Globe Mackay Cable and Radio Corporation vs. Court
of Appeals, 176 SCRA 778 [1989]).
The elements of an abuse of right under Article 19 are the following:
(1) There is a legal right or duty; (2) which is exercised in bad faith;
(3) for the sole intent of prejudicing or injuring another. Article 20
speaks of the general sanction for all other provisions of law which do
not especially provide for their own sanction (Tolentino, supra, p. 71).
Thus, anyone who, whether willfully or negligently, in the exercise of
his legal right or duty, causes damage to another, shall indemnify his
victim for injuries suffered thereby. Article 21 deals with acts contra
bonus mores, and has the following elements: 1) There is an act
which is legal; 2) but which is contrary to morals, good custom, public
order, or public policy; 3) and it is done with intent to injure. Thus,
under any of these three (3) provisions of law, an act which causes
injury to another may be made the basis for an award of damages.
Of the three articles, Art. 19 was intended to expand the concept of
torts by granting adequate legal remedy for the untold number of
moral wrongs which is impossible for human foresight to provide
specifically in statutory law. If mere fault or negligence in ones acts
can make him liable for damages for injury caused thereby, with more
reason should abuse or bad faith make him liable. The absence of
good faith is essential to abuse of right. Good faith is an honest
intention to abstain from taking any unconscientious advantage of
another, even through the forms or technicalities of the law, together
with an absence of all information or belief of fact which would render
the transaction unconscientious. In business relations, it means good
faith as understood by men of affairs.
While Article 19 may have been intended as a mere declaration of
principle, the cardinal law on human conduct expressed in said
article has given rise to certain rules, e.g. that where a person
exercises his rights but does so arbitrarily or unjustly or performs his
duties in a manner that is not in keeping with honesty and good faith,
he opens himself to liability.

Article 19 of the Civil Code, sets certain standards which may be


observed not only in the exercise of ones rights but also in the
performance of ones duties. These standards are the following: to
act with justice; to give everyone his due; and to observe honesty and
good faith. The law, therefore, recognizes the primordial limitation on
all rights: that in their exercise, the norms of human conduct set forth
in Article 19 must be observed. A right, though by itself legal because
recognized or granted by law as such, may nevertheless become the
source of some illegality.

THE BOARD OF LIQUIDATORS VS. HEIRS OF MAXIMO M.


KALAW, et.al
FACTS:
Maximo Kalaw, as general manager of the governmental
organization, the National Coconut Corporation (NACOCO), entered
into various contracts (involving the sale of Copra), without prior
authority of the Board of Directors. However, he later presented the
contracts to the Board for ratification. Under the NACOCOs
corporate by laws, prior approval is required. The Board ratified said
contracts although Kalaw had informed them that losses would be
incurred, due to typhoons, etc. After Kalaws death, action was
brought against Kalaws heirs and against the members of the Board
to recover governmental losses in the transactions. The action was
brought by the Board of Liquidators, an entity that took place of
NACOCO, after it was dissolved.
ISSUE:
Whether or not damages can be recovered?
RULING:
Damages cannot be recovered, for Kalaw and the Board did not
act in bad faith. Several reasons may be given:
a. While it is true that NACOCO by-laws specifically provided
for prior approval, still a general manager by the very nature
of his functions should be allowed greater leeway. A rule that
has gained acceptance throughout the years is that a
corporate general may do necessary and appropriate acts
without special authority from the Board. This is especially
true in copra-trading where future sales or forward sales
of still unproduced copra are needed to facilitate sales turnovers. To call the Board to a formal meeting is difficult when
time is essential.

b. Many times in the past, Kalaw had done the same without
prior Board approval; profits were then made; instead of
criticism, Kalaw had received a bonus for signal
achievement.
c. Even assuming need for prior authority, it must be
remembered that RATIFICATION retroacts to the time of the
act or contract ratified, and is therefore equivalent to original
authority.
d. Bad faith does not simply connote bad judgment or
negligence; it imparts a dishonest purpose or some moral
obliquity and conscious doing wrong. None of these is
present here. Thus, Kalaw and the Board are NOT LIABLE.

EREDENA AGAWA VDA. DE ORIBIANA VS. ATTY. GERIO


FACTS:
The client of a lawyer had no money to psy for the printing of a
brief. So the lawyer did not file one.
ISSUE:
Whether or not the lawyer is administratively liable?
RULING:
Yes, for he could have filed a mimeographed or typewritten
brief, or he could have informed the court of his difficulty in preparing
a printed brief.

ALBETZ INVESTMENTS, INC. VS. COURT OF APPEALS


FACTS:
Having won a case in final and executory judgment, the winning
party, in having the judgment executed, did not give the occupants of
a house (sought to be demolished) sufficient time to remove their
personal belongings.
ISSUE:
Whether or not said ocuupants are entitled to damages?
RULING:
Since no reasonable time was given and the belongings were
damaged, the demolition of the house may be said to have been
carried out in a manner not consistent with justice and good faith, as
required by Article 19 of the Civil Code. Damages may therefore be
awarded in view of this abuse of a right.

VELAYO VS. SHELL CORPORATION OF THE PHILIPPINES


FACTS:
The CALI (Commercial Air Lines, Inc.) knew it did not have
sufficient assets to pay of its liabilities, and so it called a meeting of its
creditors, who agreed that they would be contended with a pro rata
division of the assets, including a C-54 plane, still in California. One
of the creditors, the Shell Co., took advantage of this information and
made a telegraphic assignment of its credit in favor of a sister Shell
Co., in the United States which then promptly attached the plane in
California, thus depriving the other creditors of its value.
ISSUE:
Whether or not the Shell Co. in the Philippines can be made to
pay for damages to the other creditors?
RULING:
Yes, because it did not show good faith and honesty.

MANILA ELECTRIC CO. VS. COURT OF APPEALS


FACTS:
Because of respondents failure to pay his electric bills,
MERALCO cut his electric supply without prior notice.
ISSUE:
Whether or not MERALCO is liable for damages?
RULING:
Yes, MERALCO is liable for damages under Article 19. The law
requires at least a 48-hours notice before electric supply service of
disconnection is made to a delinquent customer. Failure to provide
said prior written notice amounts to tort.

RULES OF COURT
RULE 1, SECTION 6
CONSTRUCTION these rules shall be liberally construed in order
to promote their objective of securing a just, speedy, and inexpensive
disposition of every action and proceeding.
This Section is a recognition of the fact that the rules of
procedure one mere tools designed to facilitate the attainment of
justice. Thus, the liberal construction of these rules has been allowed
in the following cases: (1) where rigid application will result in
manifest failure or miscarriage of justice; (2) where the interest of
substantial justice will be served; (3) where the resolution of the
motion is addressed solely to the sound and judicious discretion of
the court and (4) where the injustice to the adverse party is not
commensurate with the prescribed procedure.
In fact, in line with the spirit and purpose of this Section, even
the rules may be justified in the interest of fair play. It was held that
the Court has the power to suspend the rules, or to except a
particular case from their operation, whenever the ends of justice so
require.

LEANDRO ALCANTARA VS. PCIB


FACTS:
The petitioner seeks to annul and set aside the subsequent
resolution issued by the Court of Appeals due to his allegedly
involvement with a big syndicate and taking advantage of the trust
and confidence reported in his position that causes him the dismissed
of his employment at the Philippine Commercial and International
Bank. The Court of Appeal issued a resolution for the dismissal of the
motion for reconsideration in which the petitioner petition for review.

ISSUE:
Whether or not the Court of Appeals approved the petition in
annuling the subsequent resolution?
RULING:
No, the resolution did not comply to submit the requirements to
have sufficient grounds for review of his petition and a lock of merit
for the petition on the issue of the dismissal of employment.

NILO T. PATES VS. COMELEC AND EMELITA ALIMARANTE


FACTS:
The Petitioner asks for Urgent Motion for Reconsideration with
reiteration for the Issuance of a Temporary Protection Order to
reverse the dismissal of his petition, arguing that the petition was
seasonably filed under the fresh period rule enunciated by the
Supreme Court in a number of cases decided beginning the year
2005. He claims that, historically, the fresh period rule was the
prevailing rule in filing petitions for certiorari.
ISSUE:
Whether or not the petitioners claim of fresh period rule is
application in order to grant the Urgent Motion for Reconsideration?
RULING:
The Court is not inclined to suspend the rules to come to the
rescue of a litigant whose counsel has blundered by reading the
wrong applicable provision. The Rules of Court are prompt and
orderly administration of justice, litigants cannot, after resorting to a
wrong remedy, simply cry for liberal construction of these rules.
Liberality does not signify an unbridled exercise of discretion. It has

its limits, to serve its purpose and to preserve its true worth; it must
be exercised only in the most appropriate causes.

RURAL BANK OF THE SEVEN LAKES (SPC) INC. VS. BELEN A.


DAN
FACTS:
In 1975, Belen A. Dan was employed by RBSL as an assistant
bookkeeper. She rose from the ranks band in 1982, she was
appointed bank manager by the RBSL Board of Directors. Sometime
in 1998, RBSL discovered that Dan committed unsound banking
practices, which included the granting of loans to herself, her relatives
and close friends. Dan was charged with (a) violation of Section 5 of
RA no. 7353; (b) loss of confidence; (c) willful disobedience to the
lawful order of the employer; (e) willful breach of trust; and (f)
incompetence.
ISSUE:
Whether or not Dan committed forum shopping?
RULING:
The liberal interpretation and application of rules apply only in
proper cases of demonstrable merit and under justifiable causes and
circumstances. While it is true that litigation is not a game of
technicalities, it is equally true that every case must be prosecuted in
accordance with the prescribed procedure to ensure an orderly and
speedy administration of justice.

THE ASIA UNITED BANK VS. GOODLAND COMPANY, INC.


FACTS:
The petitioner asssails the orders of the Regional Trial Court of
Makati City, Branch 150, which in turn denied due course to
respondent Goodland Company, Inc.s notice of appeal for invalid
substitution of counsel. Goodland through its counsel Atty. Antonio9
Bautista, opposed the petition for the Issuance of Writ of possession
file by Asia United Bank being declared as the highest bidder of the
public auction sale held on December 4, 2006 denying that it
executed the real estate mortgage. Goodland further averred that the
signature ohf the notary public appearing on the deed was forgery,
and that no technical description of the property supposedly
mortgaged was indicated therein. They sought recourse with the
Court of Appeals by initially filing a Notice of Appeal with the RTC
through a certain Atty. Lito Mondragon and Montoyo Law offices. RTC
issued an order denying due course to Goodlands notice of appeal
for being inutile due to Atty. Mondragons failure to porperly effect the
substitution of former ciunsel on record, Atty. Bautista.
ISSUE:
Whether or not the substitution of Atty. Mondragon is
substantive reason of the RTC to issue an order denying due course
to Goodlands notice of appeal?
RULING:
Under the Rule 1, Section 6 of the 1997 Rules of Civil
Procedure, Liberal Construction of the rule is the controlling principle
to effect substantial justice. Thus, litigation should, as much as
possible, be decided on their merits and not on technicalities. This
does not mean, however, that procedural rules are to be ignored or
disclaimed at will to suit the convenience of a party. Procedural law
has its own rationale in the orderly administration of justice. Hence,
rules of procedure must be faithfully followed except only when for

persuasive reasons, they may be related to relieve a litigant of an


injustice not commensurate with his failure to comply with the
prescribed procedure.