Catholic Vicar Vs.

CA
Date: September 31, 1988
Facts:
5 19O2: Catholic Vicar Apostolic of the Mountain Province OVicarq, petitioner, filed
with the court an application for the registration of title over lots 1, 2, 3 and 4 situated
in Poblacion Central, Benguet, said lots being used as sites of the Catholic Church,
building, convents, high school building, school gymnasium, dormitories, social hall
and stonewalls.
5 19O3: Heirs of Juan Valdez and Heirs of Egmidio Octaviano claimed that they have
ownership over lots 1, 2 and 3. O2 separate civil casesq
5 19O5: The land registration court confirmed the registrable title of Vicar to lots 1 , 2,
3 and 4. Upon appeal by the private respondents Oheirsq, the decision of the lower
court was reversed. Title for lots 2 and 3 were cancelled.
5 VICAR filed with the Supreme Court a petition for review on certiorari of the decision
of the Court of Appeals dismissing his application for registration of Lots 2 and 3.
5 During trial, the Heirs of Octaviano presented one O1q witness, who testified on the
alleged ownership of the land in question OLot 3q by their predecessor5in5interest,
Egmidio Octaviano; his written demand to Vicar for the return of the land to them; and
the reasonable rentals for the use of the land at P10,000 per month. On the other
hand, Vicar presented the Register of Deeds for the Province of Benguet, Atty. Sison,
who testified that the land in question is not covered by any title in the name of Egmidio
Octaviano or any of the heirs. Vicar dispensed with the testimony of Mons. Brasseur
when the heirs admitted that the witness if called to the witness stand, would testify
that Vicar has been in possession of Lot 3, for 75 years continuously and peacefully
and has constructed permanent structures thereon.

Issue: WON Vicar had been in possession of lots 2 and 3 merely as bailee borrower
in commodatum, a gratuitous loan for use.

Held: YES.
Private respondents were able to prove that their predecessors4 house was borrowed
by petitioner Vicar after the church and the convent were destroyed. They never asked
for the return of the house, but when they allowed its free use, they became bailors in
commodatum and the petitioner the bailee.

The bailees4 failure to return the subject matter of commodatum to the bailor did not
mean adverse possession on the part of the borrower. The bailee held in trust the
property subject matter of commodatum. The adverse claim of petitioner came only in
1951 when it declared the lots for taxation purposes. The action of petitioner Vicar by
such adverse claim could not ripen into title by way of ordinary acquisitive prescription
because of the absence of just title.

The Court of Appeals found that petitioner Vicar did not meet the requirement of 30
years possession for acquisitive prescription over Lots 2 and 3. Neither did it satisfy
the requirement of 10 years possession for ordinary acquisitive prescription because
of the absence of just title. The appellate court did not believe the findings of the trial
court that Lot 2 was acquired from Juan Valdez by purchase and Lot 3 was acquired
also by purchase from Egmidio Octaviano by petitioner Vicar because there was
absolutely no documentary evidence to support the same and the alleged purchases
were never mentioned in the application for registration.
Republic V. Bagtas O19O2q G.R. No. L517474 October 25, 19O2
Laws Applicable: Commodatum
FACTS:
May 8, 1948: Jose V. Bagtas borrowed from the Republic of the Philippines
through the Bureau of Animal Industry three bulls: a Red Sindhi with a book value of
P1,17O.4O, a Bhagnari, of P1,320.5O and a Sahiniwal, of P744.4O, for a period of 1
year for breeding purposes subject to a breeding fee of 101 of the book value of the
bulls.
May 7, 1949: Jose requested for a renewal for another year for the three bulls
but only one bull was approved while the others are to be returned
March 25, 1950: He wrote to the Director of Animal Industry that he would pay the
value of the 3 bulls.
October 17, 1950: he reiterated his desire to buy them at a value with a
deduction of yearly depreciation to be approved by the Auditor General.
October 19, 1950: Director of Animal Industry advised him that either the 3 bulls
are to be returned or their book value without deductions should be paid not later than
October 31, 1950 which he was not able to do.
December 20, 1950: An action at the CFI was commenced against Jose praying
that he be ordered to return the 3 bulls or to pay their book value of P3,241.45 and the
unpaid breeding fee of P199.O2, both with interests, and costs.
July 5, 1951: Jose V. Bagtas, through counsel Navarro, Rosete and Manalo,
answered that because of the bad peace and order situation in Cagayan Valley,
particularly in the barrio of Baggao, and of the pending appeal he had taken to the
Secretary of Agriculture and Natural Resources and the President of the Philippines,
he could not return the animals nor pay their value and prayed for the dismissal of the
complaint.
RTC: granted the action
December 1958: granted an ex5parte motion for the appointment of a special
sheriff to serve the writ outside Manila.
December O, 1958: Felicidad M. Bagtas, the surviving spouse of Jose who died
on October 23, 1951 and administratrix of his estate, was notified.
 January 7, 1959: she file a motion that the 2 bulls where returned by his son on
June 2O, 1952 evidenced by recipt and the 3rd bull died from gunshot wound inflicted
during a Huk raid and prayed that the writ of execution be quashed and that a writ of
preliminary injunction be issued.

ISSUE: WHN the contract is commodatum and NOT a lease and the estate should be
liable for the loss due to force majeure due to delay.

HELD: YES. If contract was commodatum then Bureau of Animal Industry retained
ownership or title to the bull it should suffer its loss due to force majeure. A contract of
commodatum is essentially gratuitous. If the breeding fee be considered a
compensation, then the contract would be a lease of the bull. Under article 1O71 of
the Civil Code the lessee would be subject to the responsibilities of a possessor in bad
faith, because she had continued possession of the bull after the expiry of the contract.
And even if the contract be commodatum, still the appellant is liable if he keeps it
longer than the period stipulated the estate of the late defendant is only liable for the
sum of P859.O3, the value of the bull which has not been returned because it was
killed while in the custody of the administratrix of his estate Special proceedings for
the administration and settlement of the estate of the deceased Jose V. Bagtas having
been instituted in the CFI, the money judgment rendered in favor of the appellee
cannot be enforced by means of a writ of execution but must be presented to the
probate court for payment by the appellant, the administratrix appointed by the court.
Saura Import 9 Export v DBP O1972q
FACTS:
In July 1952, Saura, Inc., applied to Rehabilitation Finance Corp., now DBP, for
an industrial loan of P500, 000 to be used for the construction of a factory building, to
pay the balance of the jute mill machinery and equipment and as additional working
capital. In Resolution No.145, the loan application was approved to be secured first
by mortgage on the factory buildings, the land site, and machinery and equipment to
be installed.
The mortgage was registered and documents for the promissory note were
executed. But then, later on, was cancelled to make way for the registration of a
mortgage contract over the same property in favor of Prudential Bank and Trust Co.,
the latter having issued Saura letter of credit for the release of the jute machinery. As
security, Saura execute a trust receipt in favor of the Prudential. For failure of Saura
to pay said obligation, Prudential sued Saura.
After almost 9 years, Saura Inc, commenced an action against RFC, alleging
failure on the latter to comply with its obligations to release the loan applied for and
approved, thereby preventing the plaintiff from completing or paying contractual
commitments it had entered into, in connection with its jute mill project.
The trial court ruled in favor of Saura, ruling that there was a perfected contract
between the parties and that the RFC was guilty of breach thereof.

ISSUE: Whether or not there was a perfected contract between the parties. YES.
There was indeed a perfected consensual contract.
HELD:
· Article 1934 provides: An accepted promise to deliver something by way of
commodatum or simple loan is binding upon the parties, but the commodatum or
simple loan itself shall not be perfected until delivery of the object of the contract.
· There was undoubtedly offer and acceptance in the case. The application of
Saura, Inc. for a loan of P500, 000.00 was approved by resolution of the defendant,
and the corresponding mortgage was executed and registered. The defendant failed
to fulfill its obligation and the plaintiff is therefore entitled to recover damages.
· When an application for a loan of money was approved by resolution of the
respondent corporation and the responding mortgage was executed and registered,
there arises a perfected consensual contract.
· However, it should be noted that RFC imposed two conditions Oavailability of
raw materials and increased productionq when it restored the loan to the original
amount of P500,000.00.
· Saura, Inc. obviously was in no position to comply with RFC4s conditions. So
instead of doing so and insisting that the loan be released as agreed upon, Saura, Inc.
asked that the mortgage be cancelled.The action thus taken by both parties was in the
nature of mutual desistance which is a mode of extinguishing obligations. It is a
concept that derives from the principle that since mutual agreement can create a
contract, mutual disagreement by the parties can cause its extinguishment.
·WHEREFORE, the judgment appealed from is reversed and the complaint dismissed.
Herrera v Petrophil Corp

FACTS:
On December 5, 19O9, Herrera and ESSO Standard, Olater substituted by
Petrophil Corp.,q entered into a lease agreement, whereby the former leased to the
latter a portion of his property for a period of 20yrs. subject to the condition that monthly
rentals should be paid and there should be an advance payment of rentals for the first
eight years of the contract, to which ESSO paid on December 31, 19O9. However,
ESSO deducted the amount of 101, 010.73 as interest or discount for the eight years
advance rental.
On August 20, 1970, ESSO informed Herrera that there had been a mistake in
the computation of the interest and paid an additional sum of 2,182.70; thus, it was
reduced to 98, 828.03.
As such, Herrera sued ESSO for the sum of 98, 828.03, with interest, claiming
that this had been illegally deducted to him in violation of the Usury Law.
ESSO argued that amount deducted was not usurious interest but rather a
discount given to it for paying the rentals in advance. Judgment on the pleadings was
rendered in favor of ESSO. Thus, the matter was elevated to the SC for only questions
of law was involve.
ISSUE: WHN the contract between the parties is one of loan or lease.
RULING
Contract between the parties is one of lease and not of loan. It is clearly
denominated a ULEASE AGREEMENT.U Nowhere in the contract is there any
showing that the parties intended a loan rather than a lease. The provision for the
payment of rentals in advance cannot be construed as a repayment of a loan because
there was no grant or forbearance of money as to constitute an indebtedness on the
part of the lessor. On the contrary, the defendant5appellee was discharging its
obligation in advance by paying the eight years rentals, and it was for this advance
payment that it was getting a rebate or discount.
There is no usury in this case because no money was given by the
defendant5appellee to the plaintiff5appellant, nor did it allow him to use its money
already in his possession. There was neither loan nor forbearance but a mere discount
which the plaintiff5appellant allowed the defendant5appellee to deduct from the total
payments because they were being made in advance for eight years. The discount
was in effect a reduction of the rentals which the lessor had the right to determine, and
any reduction thereof, by any amount, would not contravene the Usury Law.
 Integrated Realty Corp v PNB
FACTS
Raul Santos made a time deposit with OBM in the amount of P500H and he
was issued a certificate of time deposits. On another date, Santos again made a time
deposit with OBM in the amount of P200H, he was again issued a CTD. IRC, thru its
president Raul Santos, applied for a loan andHor credit line OP700Hq with PNB. To
secure such, Santos executed a Deed of Assignment of the 2 time deposits. After due
dates of the time deposit certificates, OBM did not pay PNB. PNB then demanded
payment from IRC and Santos, but they replied that the loan was deemed paid with
the irrevocable assignment of the time deposit certificates.
PB then filed with RTC to collect from IRC and Santos with interest. The trial
court ruled in favor of PNB ordering IRC and Santos to pay PNB the total amount of
P700H plus interest of 91 PA, 21 additional interest and 19 PA penalty interest. On
appeal, the CA ordered OBM to pay IRC and Santos whatever amts they will to PNB
with interest.
IRC and Santos now claim that OBM should reimburse them for whatever amts
they may be adjudged to pay PNB by way of compensation for damages incurred.
ISSUE
Whether or not the claim of IRC and Santos will prosper.
HELD
The Court held in the affirmative. The 2 time deposits matured on 11 January
19O8 and O February 19O8, respectively. However, OBM was not allowed and
suspended to operate only on 31 July 19O8 and resolved on 2 August 19O8. There
was a yet no obstacle to the faithful compliance by OBM of its liabilities. For having
incurred in delay in the performance of its obligation, OBM should be held for
damages. OBM contends that it had agreed to pay interest only up to the dates of
maturity of the CTD and that Santos is not entitled to interest after maturity dates had
expired.
While it is true that under Article 195O of the CC, no interest shall be due unless
it has been expressly stipulated in writing, this applies only to interest for the use of
money. It does not comprehend interest paid as damages. OBM is being required to
pay such interest, not as interest income stipulated in the CTD, but as damages fro
failure and delay in the payment of its obligations which thereby compelled IRC and
Santos to resort to the courts.
The applicable rule is that LI, in the nature of damages for non5compliance with
an obligation to pay sum of money, is recoverable from the date judicially or
extra5judicially demand is made.
 Republic V CA
FACTS:
The Heirs of Domingo Baloy, Oprivate respondentsq, applied for a registration
of title for their land. Their claim is based on their possessory information title acquired
by Domingo Baloy through the Spanish Mortgage Law, coupled with their continuous,
adverse and public possession of the land in question.
The Director of Lands opposed the registration alleging that such land became
public land through the operation of Act O27 of the Philippine Commission. On Nov
2O, 1902, pursuant to the executive order of the President of U.S., the area was
declared within the US Naval Reservation.
The CFI denied respondents4 application for registration. CA, reversed the
decision. Petitioners herein filed their Motion for Reconsideration, said MR was
denied, hence this petition for review on certiorari.
ISSUE: Whether or not private respondents4 rights by virtue of their possessory
information title was lost by prescription.
RULING: No. A communication which contains an official statement of the
position of the Republic of the Philippines with regard to the status of the land in
question recognizes the fact that Domingo Baloy andHor his heirs have been in
continuous possession of said land since 1894 as attested by an UInformacion
PossessoriaU Title, which was granted by the Spanish Government. Hence, the
disputed property is private land and this possession was interrupted only by the
occupation of the land by the U.S. Navy in 1945.
The heirs of the late Domingo P. Baloy, are now in actual possession, and this
has been so since the abandonment by the U.S. Navy. The occupancy of the U.S.
Navy was not in the concept of owner. It holds of the character of a commodatum. It
cannot affect the title of Domingo Baloy. One4s ownership of a thing may be lost by
prescription by reason of another4s possession if such possession be under claim of
ownership, not where the possession is only intended to be temporary, as in the case
of the U.S. Navy4s occupation of the land concerned, in which case the owner is not
divested of his title, although it cannot be exercised in the meantime.
 Quintos v Beck
Facts:
Quintos and Beck entered into a contract of lease, whereby the latter occupied
the former4s house. On Jan 14, 193O, the contract of lease was novated, wherein the
Quintos gratuitously granted to Beck the use of the furniture, subject to the condition
that Beck should return the furniture to Quintos upon demand. Thereafter, Quintos
sold the property to Maria and Rosario Lopez. Beck was noticed of the conveyance
and given him O0 days to vacate the premises. In addition, Quintos required Beck to
return all the furniture. Beck refused to return 3 gas heaters and 4 electric lamps since
he would use them until the lease was due to expire. Quintos refused to get the
furniture since Beck had declined to return all of them. Beck deposited all the furniture
belonging to Quintos to the sheriff.
ISSUE: WON
Beck complied with his obligation of returning the furniture to Quintos when it
deposited the furniture to the sheriff.
RULING:
The contract entered into between the parties is one of commadatum, because
under it the plaintiff gratuitously granted the use of the furniture to the defendant,
reserving for herself the ownership thereof; by this contract the defendant bound
himself to return the furniture to the plaintiff, upon the latter demand Oclause 7 of the
contract, exhibit A; articles 1740, paragraph 1, and 1741 of the Civil Codeq. The
obligation voluntarily assumed by the defendant to return the furniture upon the
plaintiff4s demand, means that he should return all of them to the plaintiff at the latter4s
residence or house. The defendant did not comply with this obligation when he merely
placed them at the disposal of the plaintiff, retaining for his benefit the three gas
heaters and the four electric lamps.
As the defendant had voluntarily undertaken to return all the furniture to the
plaintiff, upon the latter4s demand, the court could not legally compel her to bear the
expenses occasioned by the deposit of the furniture at the defendant4s behest. The
latter, as bailee, was not entitled to place the furniture on deposit; nor was the plaintiff
under a duty to accept the offer to return the furniture, because the defendant wanted
to retain the three gas heaters and the four electric lamps.
 Republic v Grijaldo
Facts:
Appellant Jose Grijaldo obtained five loans from the branch office of the Bank
of Taiwan. These loans are evidenced by five promissory notes executed by the
appellant in favor of the Bank of Taiwan. To secure the payment of the loans the
appellant executed a chattel mortgage on the standing crops on his land. The assets
in the Philippines of the Bank of Taiwan, Ltd. were vested in the Government of the
United States
Pursuant to the Philippine Property Act of 194O of the United States, these
assets, including the loans in question, were subsequently transferred to the Republic
of the Philippines by the Government of the United States under Transfer Agreement
dated July 20, 1954
The appellee, Republic of the Philippines, represented by the Chairman of the
Board of Liquidators, made a written extrajudicial demand upon the appellant for the
payment of the account in question.
The appellee filed a complaint in the Justice of the Peace Court of Hinigaran,
Negros Occidental, to collect from the appellant the unpaid account in question
The court a quo rendered a decision ordering the appellant to pay the appellee
the sum of P2, 233.22 as of 4ecember 21, 1959, plus interest at the rate of O5 per
annum compounded quarterly
Issue:
On the present appeal the appellant contends7 819 that the appellee has no
cause of action against the appellant: 829 that if the appellee has a cause of action at
all, that action had prescribed: and 829 that the lower court erred in ordering the
appellant to pay the amount of P2, 233.22.
Held:
This contention has no merit. It is true that the Bank of Taiwan, Ltd. was the
original creditor and the transaction between the appellant and the Bank of Taiwan
was a private contract of loan.
The successive transfer of the rights over the loans in question from the Bank
of Taiwan, Ltd. to the United States Government, and from the United States
Government to the government of the Republic of the Philippines, made the Republic
of the Philippines the successor of the rights, title and interest in said loans, thereby
creating a privity of contract between the appellee and the appellant.
The word; privy; denotes the idea of succession ... hence an assignee of a
credit, and one subrogated to it, etc. will be privies
The United States of America acting as a belligerent sovereign power seized
the assets of the Bank of Taiwan, Ltd. which belonged to an enemy country.
 The Republic of the Philippines had thereby become a privy to the original
contracts of loan between the Bank of Taiwan, Ltd. and the appellant.
The loans were secured by a chattel mortgage on the standing crops on a land
owned by him and these crops were lost or destroyed through enemy action his
obligation to pay the loans was thereby extinguished. This argument is untenable. The
terms of the promissory notes and the chattel mortgage that the appellant executed in
favor of the Bank of Taiwan, Ltd. do not support the claim of appellant
The obligation of the appellant under the five promissory notes was not to
deliver a determinate thing namely, the crops to be harvested from his land, or the
value of the crops that would be harvested from his land. Rather, his obligation was to
pay a generic thing - the amount of money representing the total sum of the five loans,
with interest.
Of simple loan of sums of money. ;By a contract of (simple) loan, one of the
parties delivers to another ... money or other consumable thing upon the condition that
the same amount of the same kind and quality shall be paid.;
On an obligation to deliver a generic thing, the loss or destruction of anything
of the same kind does not extinguish the obligation.
The chattel mortgage on the crops growing on appellant’s land simply stood as
a security for the fulfillment of appellant’s obligation covered by the five promissory
notes, and the loss of the crops did not extinguish his obligation to pay, because the
account could still be paid from other sources aside from the mortgaged crops.
This contention of the appellant is also without merit.
The decision of the court a quo ordered the appellant to pay the sum of P2,
233.22 as of 4ecember 21, 1959, plus interest rate of 6% per annum compounded
quarterly from the date of the filing of the complaint.
The decision appealed from is affirmed, with costs against the appellant.
His estate must answer in the execution of the judgment in the present case.
 De Los Santos v Jarra
Facts:
The Plaintiff Felix delos Santos filed this suit against Agustina Jarra. Jarra was
the administratix of the estate of Jimenea. Plaintiff alleged that he owned 10 1st class
carabaos which he lent to his father-in-law Jimenea to be used in the animal-power
mill without compensation. This was done on the condition of their return after the work
at the latter’s mill is terminated. When delos Santos demanded the return of the
animals Jimenea refused, hence this suit.
Issue: W/N the contracts is one of a commodatum
Ruling:
YES. The carabaos were given on commodatum as these were delivered to be
used by defendant. Upon failure of defendant to return the cattle upon demand, he is
under the obligation to indemnify the plaintiff by paying him their value. Since the 6
carabaos were not the property of the deceased or of any of his descendants, it is the
duty of the administratrix of the estate to either return them or indemnify the owner
thereof of their value.
Mina v Pascual
Facts:
Francisco Fontanilla and Andres Fontanilla were brothers. Francisco Fontanilla
acquired during his lifetime, on March 12, 1874, a lot. Andres Fontanilla, with the
consent of his brother Francisco, erected a warehouse on a part of the said lot,
embracing 14 meters of its frontage by 11 meters of its depth. Francisco Fontanilla,
the former owner of the lot, being dead, the herein plaintiffs, Alejandro Mina, et al.,
were recognized without discussion as his heirs. Andres Fontanilla, the former owner
of the warehouse, also having died, the children of Ruperta Pascual were recognized,
though it is not said how, and consequently are entitled to the said building, or rather,
as Ruperta Pascual herself stated, to only six-sevenths of one-half of it, the other half
belonging, as it appears, to the plaintiffs themselves, and the remaining one-seventh
of the first one-half to the children of one of the plaintiffs, Elena de Villanueva.
Ruperta Pascual, as the guardian of her minor children, the herein defendants,
petitioned the Court of First Instance of Ilocos Norte for authorization to sell "the six-
sevenths of the one-half of the warehouse, of 14 by 11 meters, together with its lot.
The warehouse, together with the lot on which it stands, was sold to Cu Joco, the other
defendant in this case
Issue: WoN there exist a contract of commodatum
Held:
Although both litigating parties may have agreed in their idea of the
commodatum, on account of its not being, as indeed it is not, a question of fact but of
law Contracts are not to be interpreted in conformity with the name that the parties
thereto agree to give them, but must be construed, duly considering their constitutive
elements, as they are defined and denominated by law. By the contract of loan, one
of the parties delivers to the other, either anything not perishable, in order that the
latter may use it during the certain period and return it to the former, in which case it
is called commodatum
It is, therefore, an essential feature of the commodatum that the use of the thing
belonging to another shall BE for a certain period. Francisco Fontanilla did not fix any
definite period or time during which Andres Fontanilla could have the use of the lot
whereon the latter was to erect a stone warehouse of considerable value, and so it is
that for the past thirty years of the lot has been used by both Andres and his
successors in interest.
 Briones v Cammayo
FACTS:
Plaintiff filed an action against the defendants to recover from them the amount
of P1, 500.00, plus damages, attorney's fees and costs of suit. The defendants
answered that a mortgage contract was executed for securing the payment of
P1,500.00 for a period of one year, without interest, but the plaintiff delivered to the
defendant Primitivo only the sum of P1,200.00 and withheld the sum of P300.00 which
was intended as advance interest for one year; that on account of said loan of
P1,200.00, defendant Primitivo paid to the plaintiff the total sum of P330.00 which
plaintiff, illegally and unlawfully refuse to acknowledge as part payment of the account
but as an interest of the said loan for an extension of another term of one year; and
that said contract of loan entered into between plaintiff and defendant Primitivo is a
usurious contract. Briones denied the allegations of the counterclaim. The Municipal
Court rendered judgment sentencing the defendants to pay the plaintiff with interests
thereon plus attorney's fees. The Court of First Instance of Manila also ordered the
defendants to pay the plaintiff. Defendants claim that the trial court erred in sentencing
them to pay the principal of the loan notwithstanding its finding that the same was
tainted with usury. It is not now disputed that the contract of loan in question was
tainted with usury.
ISSUE:
Whether the creditor is entitled to collect from the debtor the amount
representing the principal obligation in a contract of loan tainted with usury
HELD:
Yes. Under the Usury Law a usurious contract is void and the creditor had no
right of action to recover the interest in excess of the lawful rate but this did not mean
that the debtor may keep the principal received by him as loan — thus unjustly
enriching himself to the damage of the creditor. The Usury Law, by its letter and spirit,
did not deprive the lender of his right to recover from the borrower the money actually
loaned to and enjoyed by the latter. In simple loan with stipulation of usurious interest,
the prestation of the debtor to pay the principal debt, which is the cause of the contract,
is not illegal. The illegality lies only as to the prestation to pay the stipulated interest;
hence, being separable, the latter only should be deemed void, since it is the only one
that is illegal. The principal debt remaining without stipulation for payment of interest
can be recovered by judicial action. And in case of such demand, and the debtor incurs
in delay, the debt earns interest from the date of the demand. Such interest is not due
to stipulation, for there was none, the same being void. Rather, it is due to the general
provision of law that in obligations to pay money, where the debtor incurs in delay, he
has to pay interest by way of damages.
 Lopez v del Rosario
FACTS:
Benita Quiogue de V. del Rosario (Mrs. del Rosario), owner of a bonded
warehouse where Froilan Lopez, holder or 14 waehouse receipts and Elias Zamora
had their copra deposited.
The warehouse recipts states an insurance of 1% their declared value which
can be increase or decrease by giving 1 months’ notice in writing.
Lopez paid the insurance to May 18, 1920, but not thereafter.
June 6, 1920: the warehouse was destroyed by fire. Only copra worth P49,985
was salvaged. At that time Lopez was still liable for the storage and insurance of
P315.90.
Mrs. Del Rosario submitted the insurance with the arbitrators and seems to
have satisfied all of the persons who had copra stored in her warehouse, including the
stockholders in the Compañia Coprera de Tayabas (whose stock she took over), with
the exception of Froilan Lopez.
Ineffectual attempts by Mrs. Del Rosario to effect a compromise with Lopez first
for P71,994, later raised to P72,724, and finally reduced to P17,000, were made. But
Lopez stubbornly contended, or, at least, his attorney contended for him, that he
should receive not a centavo less than P88,595.43 (from originally P107,990.40).
ISSUE: W/N Mrs. Del Rosario should be held liable to Lopez even if he has not
paid the insurance at the time of the fire.
HELD: YES. entitled to P88,595.43 minus P7,185.88, his share of the
expenses, minus P315.90, due for insurance and storage, or approximately a net
amount of P81,093.65, with legal interest.