ARTURO FLORES VS SPOUSES LINDO

G.R. NO. 183984 | APRIL 13, 2011

Petitioner: Arturo Sarte Flores

Respondents: Spouses Enrico L. Lindo, Jr. and Edna C. Lindo

Topic: Unjust Enrichment

Laws/Provisions:

Art. 22. Every person who through an act of performance by another, or any other means, acquires or comes into
possession of something at the expense of the latter without just or legal ground, shall return the same to him.

Unjust enrichment exists when a person unjustly retains benefit to the loss of another, or when a person retains
money or property of another against the fundamental principles of justice, equity and good conscience.

The principle of unjust enrichment requires two conditions: 1. That a person is benefited without a valid basis or
justification; 2. That such benefit is derived at the expense of another.

Art. 124. The administration and enjoyment of the conjugal partnership property shall belong to both spouses jointly.
In case of disagreement, the husbands decision shall prevail, subject to recourse to the court by the wife for proper
remedy, which must be availed of within five years from the date of contract implementing such decision.

In the event that one spouse is incapacitated or otherwise unable to participate in the administration of the conjugal
properties, the other spouse may assume sole powers of administration. These powers do not include disposition or
encumbrance without authority of the court or the written consent of the other spouse. In the absence of such
authority or consent the disposition or encumbrance shall be void. However, the transaction shall be construed as
a continuing offer on the part of the consenting spouse and the third person, and may be perfected as a binding
contract upon the acceptance by the other spouse or authorization by the court before the offer is withdrawn by
either or both offerors. (Emphasis supplied)

(Article 124 of the Family Code of which applies to conjugal partnership property, is a reproduction of Article 96 of
the Family Code which applies to community property.)

Art. 96. The existing laws which punish acts or omissions concerning the marriage license, solemnization of marriage,
authority to solemnize marriages, and other acts or omissions relative to the celebration of marriage shall remain
and continue to be in force. (n)

Precedent:

Chieng v. Santos: this Court ruled that a mortgage-creditor may institute against the mortgage-debtor either a
personal action for debt or a real action to foreclose the mortgage. The Court ruled that the remedies are alternative
and not cumulative and held that the filing of a criminal action for violation of BatasPambansa Blg. 22 was in effect
a collection suit or a suit for the recovery of the mortgage-deb

Facts:

Edna Lindo obtained a loan from Arturo Flores amounting to 400,000 pesos payable on December 1, 1995 with 3%
compounded monthly interest and 3% surcharges. Such loan was secured by Deed of Real Estate Mortgage covering
the property in the name of Edna and his husband, Enrico. Edna also signed a promissory note.
As partial payments, Ed issued three checks, however, the checks were dishonored for insufficiency of funds. As a
result, Arturo, petitioner filed a Complaint for Foreclosure of Mortgage with Damages.

The RTC Branch 33, in its decision dated September 30, 2003, ruled that the petitioner is not entitled to judicial
foreclosure of the mortgage because the deed was executed by Edna without consent and authority of Enrico. The
deed was executed on October 31, 1995 while the Special Power of Attorney (SPA) was only executed on November
4, 1995. The real estate mortgage executed by petition Edna Lindo over their conjugal property is undoubtedly an
act of strict dominion and must be consented to by her husband to be effective.

RTC further ruled that the petitioner was not precluded from recovering the loan as he could file a personal action
against Edna, but the RTC had no jurisdiction over the personal action. It should be filed in the place of residence
where Edna resides pursuant to Sec.2, Rule 4 of the Revised Rules on Civil Procedure.

Petitioner filed a motion for reconsideration but it was denied for lack of merit.

On September 8, 2004, petitioner filed a complaint for Sum of Money with Damages before the RTC branch 42.
Respondents filed an answer wherein they admitted the loan but stated that it amounted to 340,000 pesos. Further,
respondent alleged that Enrico was not a party to the loan because it was contracted by Edna.

Respondents prayed for dismissal on the grounds of improper venue, res judicata and forum shopping, invoking the
decision of RTC branch 33. And on March 7, 2005, they also filed motion to dismiss on the grounds of res judicata
and lack of cause of action.

RTC branch 42, in its decision, denied the motion to dismiss because res judicata is not applicable to rights, claims
or demands which constitute separate or distinct causes of action and were not put in issue in the former action.
RTC also stated that Branch 33 did not mean that petitioner could no longer recover the loan.

Respondent filed a Petition before the CA.

The CA set aside the decisions of RTC branch 42 for having issued with grave abuse of discretion in denying
respondents’ motion to dismiss.

Further, CA ruled that under Sec. 3, Rule 2 of the 1997 Rules of Civil Procedure, a party may not institute more than
one suit for a single cause of action. In this case, Arturo has a single cause of action that is recovery of the credit with
execution of suit. Thus the creditor has alternative remedies: either 1. personal collection for debt or 2. real action
to foreclose the mortgage. According to the CA, by filing a petition for foreclosure of real estate mortgage, petitioner
had already waived the second remedy.

Issue: WON the Court of Appeals committed a reversible error in dismissing the complaint for collection of sum of
money on the ground of multiplicity of suits.

Ruling: The Resolutions of the CA are SET ASIDE. The RTC brach 42 is directed to proceed with the trial.

Ratio: YES. It is true that as a rule, a mortgagee-creditor has a single cause of action against a mortgagor-debtor,
that is, to recover the debt; and that he has the option of either filing a personal action for collection of sum of
money or instituting a real action to foreclose on the mortgage security. These remedies are alternative and each
remedy is complete by itself.

However, in this case, the Supreme Court made a pro hac vice (for or on this case only) decision which allows Flores
to recover through a personal action despite his prior filing of a real action for foreclosure of mortgage. The principle
against just enrichment, being a substantive law, should prevail over the procedural rule on multiplicity of suits. Edna
admitted the loan, except that she claimed it only amounted to 340, 000 pesos. Edna should not be allowed to
unjustly enrich herself because of the erroneous decisions of two trial courts when she questioned the validity of
the deed.

Further, the ruling of the Manila RTC Branch 33 is erroneous when it ruled that the mortgage between Edna and
Flores is invalid. It is true that a disposition of a conjugal property by one spouse without the consent of the other
spouse is VOID. However, pursuant to art. 96 and 127 of the Family Code, there is a continuing offer on the part of
the consenting spouse and the third person, and may be perfected as a binding contract upon the acceptance by the
other spouse.
HAMBON VS CA

G.R. NO. 122150 | MARCH 17, 2003

Petitioner: George (Culhi) Hambon

Respondent: Court of Appeals and Valentino U. Carantes

Topic: Independent Civil Action

Laws/Provisions:

Art. 31. When the civil action is based on an obligation not arising from the act or omission complained of as a felony,
such civil action may proceed independently of the criminal proceedings and regardless of the result of the latter.

An independent civil action is one that is brought distinctly and separately from a criminal case allowed for
considerations of public policy, because the proof needed for civil cases is LESS than that required for criminal cases.

Section 1, Rule 111 of the 1985 Rules on Criminal Procedure, as amended in 1988: SECTION 1. Institution of criminal
and civil actions. When a criminal action is instituted, the civil action for the recovery of civil liability is impliedly
instituted with the criminal action, unless the offended party waives the civil action, reserves his right to institute it
separately, or institutes the civil action prior to the criminal action.

Precedent:

Abellana v. Marave- civil action for damages may be filed and proceed independently of the criminal action even
without reservation to file the same has been made;[12] and that the requirement of reservation, as provided in Rule
111 of the Rules of Court, practically diminished/amended/modified his substantial right.

Maniago v. Court of Appeals- Court ruled that the right to bring an action for damages under the Civil Code must be
reserved, as required by Section 1, Rule 111, otherwise it should be dismissed; [16] and that the reservation
requirement does not impair, diminish or defeat substantive rights, but only regulates their exercise in the general
interest of orderly procedure

Facts:

On June 6, 1989, the petitioner filed before the Regional Trial Court of Baguio (Branch 6), a complaint for
damages for the injuries and expenses he sustained after the truck driven by the respondent bumped him on the
night of December 9, 1985.
In his answer, respondent contended that the criminal case arising from the same incident for Serious Physical
Injuries through Reckless Imprudence, earlier filed on January 8, 1986, had already been provisionally dismissed by
the Municipal Trial Court of Tuba, Benguet on March 23, 1987, due to petitioners lack of interest; and that the
dismissal was with respect to both criminal and civil liabilities of respondent.
The RTC ruled that the civil case was not barred by the dismissal of the criminal case, and that the petitioner is
entitled to damages.
On appeal, the CA reversed and set aside the decision of RTC and dismissed petitioner’s complaint for damages.
Since the petitioner did not make any reservation to institute a separate civil action for damages, it was impliedly
instituted with the criminal case, and the dismissal of the criminal case carried with it the dismissal of the suit for
damages, notwithstanding the fact that the dismissal was provisional as it amounted to an acquittal and had the
effect of an adjudication on the merits.

Issue: WHETHER OR NOT A CIVIL CASE FOR DAMAGES BASED ON AN INDEPENDENT CIVIL ACTION FALLING UNDER
ARTICLE 32, 33, 34 AND 2176 OF THE NEW CIVIL CODE BE DULY DISMISSED FOR FAILURE TO MAKE RESERVATION TO
FILE A SEPARATE CIVIL ACTION IN A CRIMINAL CASE FILED ARISING FROM THE SAME ACT OR OMISSION OF THE
ACCUSED PURSUANT TO RULE 111, SECTION 1 OF THE RULES OF COURT, THE FAILURE TO MAKE RESERVATION BEING
DUE TO THE FACT THAT THE CRIMINAL CASE WAS DISMISSED BEFORE THE PROSECUTION STARTED TO PRESENT
EVIDENCE FOR FAILURE OF THE PRIVATE COMPLAINANT TO APPEAR DESPITE NOTICE (as mentioned in the case)

or

WON A CIVIL CASE FOR DAMAGES BASED ON AN INDEPENDENT CIVIL ACTION FALLING UNDER ARTICLE 32, 33, 34
AND 2176 OF THE NEW CIVIL CODE BE DULY DISMISSED FOR FAILURE TO MAKE RESERVATION TO FILE A SEPARATE
CIVIL ACTION IN A CRIMINAL CASE (shorter version)

Ruling: Instant petition for review on certiorari is DENIED for lack of merit and the decision of CA is AFFIRMED.

Ratio: YES. Pursuant to Art. 31 of the Civil Code, civil actions filed based on an obligation not arising from the act or
omission complained of as a felony may proceed independently of the criminal proceedings regardless of the result
of the latter. However, the petitioner did not make reservation to institute a separate civil action for damages based
on Article 32, 33, 34 and 2176 (quasi-delict) of The New Civil Code.

Petitioner Hambon should have reserved his right to separately institute civil action for damages in order for it to
prosper despite the results of the criminal action filed. Having failed to do so, the damages subsequently filed by
him without prior reservation should be DISMISSED.