FAUSTO BARREDO, petitioner, vs.

SEVERINO GARCIA and TIMOTEO

ALMARIO, respondents
No. 48006. July 8, 1942

DOCTRINE:
Plaintiffs may choose bring cause of action under the Civil Code (as quasi-delict or culpa
aquiliana) rather than the Penal Code for practical purposes. Employer is primarily (instead
of subsidiarily) liable, as it was shown that he had not exercised the standard of diligence
required by the Civil Code over his employee.

Facts:

A head-on collision between a taxicab owned by Barredo and a carretela occurred.

The carretela was overturned and one of its passengers, a 16-year old boy, the son of
Garcia and Almario, died as a result of the injuries which he received. The driver of the
taxicab, an employee of Barredo, was prosecuted for the crime and was convicted.
When the criminal case was instituted, Garcia and Almario reserved their right to
institute a separate civil action for damages. Subsequently, Garcia and Almario
instituted a civil action for damages against Barredo, the employer of the taxicab
driver.

On May 3, 1936, a Malate Taxicab driven by Pedro Fontanilla collided with a carriage that
had Faustino Garcia as passenger. The latter died two days later due to the injuries he
sustained.

Garcia’s parents brought a criminal action against Fontanilla before the Court of First
Instance of Rizal, which found him guilty of the charge. The court likewise granted the
petition to reserve the right to bring a separate civil action.

The Court of Appeals (CA) affirmed ruling in the criminal case. Meanwhile, the civil action
was instituted in the Court of First Instance (CFI) of Manila against Fontanilla and his
employer Fausto Barredo. CFI of Manila awarded damages to the parents worth 2,000 plus
legal interest. CA reduced the amount to 1k.

Barredo’s responsibility hinged on his failure to abide by the standard set by the Civil Code
which is that of exercising care as a good father of a family. Under this, Barredo is primarily
liable.

Defendants assert that Barredo is only subsidiarily liable under Art. 100 of the RPC since
Fontanilla was found guilty under that said law.

Issue:
Whether or not they can file a separate civil action against Fausto Barredo making him
primarily and directly responsible

1. May the petitioners institute a separate civil action against the respondents? – YES.
2. May Barredo be held primarily liable as the employer for Fontanilla’s negligence? YES
– YES.

Held:

(Foreword: The Barredo case was decided by the Supreme Court prior to the present
Civil Code. However, the principle enunciated in said case, that responsibility for fault
or negligence as quasi-delict is distinct and separate from negligence penalized under
the Revised Penal Code, is now specifically embodied in Art. 2177 of the Civil Code.)

The defendant maintains that Fontanilla’s negligence being punishable by the

Penal Code, his (defendant’s) liability as an employer is only subsidiary, according to
said Penal Code, but Fontanilla has not been sued in a civil action and his property has
not been exhausted. To decide the main issue, we must cut thru the tangle that has, in
the minds of many, confused and jumbled together delitos and cuasi delitos, or crimes
under the Penal Codeand fault or negligence under Articles 1902-1910 of the
Civil Code. According to the Supreme Tribunal of Spain:

“Authorities support the proposition that a quasi-delict or ‘culpa aquiliana’ is a

separate legal institution under the Civil Code, with a substantivity all its own, and
individuality that is entirely apart and independent from a delict or crime. Upon this
principle, and on the wording and spirit of Article 1903 of the Civil Code, the primary
and direct responsibility of employers may be safely anchored.

“It will thus be seen that while the terms of Article 1902 of the Civil Code seem to be
broad enough to cover the driver’s negligence in the instant case, nevertheless Article
1903 limits cuasi-delitos TO ACTS OR OMISSIONS ‘NOT PUNISHABLE BY LAW.’
But inasmuch as Article 365 of the Revised Penal Code punishes not only reckless but
even simple imprudence or negligence, the fault or negligence under Article 1902 of
the Civil Code has apparently been crowded out. It is this overlapping that makes the
“confusion worse confounded.’ However, a closer study shows that such
a concurrence of scope in regard to negligent acts does not destroy the distinction
between the civil liability arising from a crime and the responsibility for cuasi-delitos
or culpa extra-contractual. The same negligent act causing damages may produce civil
liability arising from a crime under Article 100 of the Revised Penal Code; or create an
action for cuasi-delito or culpa extra-contractual under Articles 1902-1910 of the
Civil Code. “Some of the differences between crimes under the Penal Code are:

“1. That crimes affect the public interest, while quasi-delitos are only of private
concern.

“2. That consequently, the Penal Code punishes or corrects the criminal act, while the
Civil Code, by means of indemnification, merely repairs the damage.
“3. That delicts are not as broad as quasi-delicts, because for the former are punished
only if there is a penal law clearly covering them, while the latter, cuasi-delitos, include
all acts in which ‘ any kind of fault or negligence intervenes.’ However, it should be
noted that not all violations of the penal law produce civil responsibility, such as
begging in contravention of ordinances, violation of the game laws, infraction of the
rules of traffic when nobody is hurt.

“The foregoing authorities clearly demonstrate the separate individuality of cuasi-

delitos or culpa aquiliana under the Civil Code. Specifically they show that there is a
distinction between civil liability arising from criminal negligence (governed by the
Penal Code) and responsibility for fault or negligence under Articles 1902 to 1910 of
the Civil Code, and that the same negligent act may produce either a civil liability
arising from a crime under the Penal Code, or a separate responsibility for fault or
negligence under Articles 1902 to 1910 of the Civil Code. Still more concretely the
authorities above cited render it inescapable to conclude that the employer – in this
case the defendant-petitioner – is primarily and directly liable under Article 1903 of
the Civil Code.”

Petitioners may institute separate civil action to recover damages.

Petitioners are seeking to recover damages not as a result of the felony (delito), but as a result
of a quasi-delict (culpa aquiliana). The latter is recognized by the civil code as a separate
legal concept.

The court has recognizes how delicts and quasi-delicts overlap, and people resort to bringing
actions as quasi-delict because of the speedier disposition of proceedings. The court sees the
advantage of bringing a case under quasi-delict rather that criminal negligence as a way to
protect private rights and efficaciously bring redress to the injured party.

Barredo is primarily/directly/principally liable.

Since the present action is a separate civil suit and not an action to recover damages arising
from criminal liability, Barredo’s negligence under the Civil Code provision invoked makes
him directly liable.

Preponderance of evidence is sufficient to prove his negligence (instead of beyond reasonable

doubt) because the case at bar is a civil action.
 Mendoza vs. Arrieta, G.R. No. L-32599,
June 29, 1979
SEPTEMBER 27, 2018

FACTS:
On October 22, 1969, a three-way vehicular accident occurred along Mac-Arthur Highway,
Marilao Bulacan involving Mercedes Benz Owner/ petitioner, Edgardo Mendoza, and
respondents jeepney driver Salazar and truck driver Montoya. This resulted in the filing of
two separate Informations of Reckless Imprudence resulting to Damage to Property. The first
one being a Php 1604.00 Criminal case against truck driver Montoya for hitting Salazar’s
jeepney at the right rear portion causing the jeep to hit Mendoza’s Mercedes, and the second
Criminal Case was against jeepney driver Salazar for hitting the Benz in the amount of Php
8,890.00.

On July 31, 1970, the Court of First Instance (CFI) of Bulacan rendered judgment. Truck
driver Montoya was found guilty beyond reasonable doubt of crime of damage to property
through reckless imprudence and was sentence to pay jeepney driver Salazar a fine for actual
damages and indemnity. Accused Rodolfo Salazar, on the other hand, was acquitted.
Mercedes Benz owner was not awarded damages.

On August 22, 1970 , after termination of criminal cases, Petitioner filed Civil Case against
truck owner Timbol and jeepney driver Salazar. Timbol filed a motion to dismiss claiming
that such action is barred by the prior judgment in criminal cases. The CFI judge granted
Timbol’s Motion to Dismiss.

ISSUES:
1. Can Timbol be sued for damages by Mendoza after termination of
criminal cases? – YES.
2. Should the Civil Case against jeepney driver Salazar be dismissed? YES.

RULING:
Timbol can be sued for damages.

No reservation need be made in the criminal case, it being substantive in character and is not
within the power of the Supreme Court to promulgate. Even if it were not substantive but
adjective, it cannot stand because of its inconsistency with Article 2177, an enactment of the
legislature superseding the Rule of 1940.

There is no oneness in Identity in the civil and criminal cases. In the former, the truck owner,
Timbol, was made a party in the case while in the latter only the jeepney driver, Salazar, was
a party in the case for the damage to Petitioner’s Mercedes Benz. Moreover, in the criminal
cases, the cause of action was the enforcement of a civil liability arising from criminal
negligence, while the August 22 Civil Case is based on quasi delict under Art 2180 in relation
to Art 2176 of the New Civil Code.

The civil case against Salazar should be dismissed.

The extinction of the penal action does not entail the extinction of the civil, unless the
extinction proceeds from a declaration in the final judgment that the fact from which the civil
might arise did not exist. Given the facts of the case, the trial court pronounced that jeepney
driver Salazar cannot be held liable for the damages sustained by petitioner’s car.

Accordingly the civil action against Salazar must be held to have been extinguished in
consonance with Section 3 (c) Rule 111 of the Rules of Court.

PSBA vs. Court of Appeals, G.R. No.

84698, February 4, 1992
SEPTEMBER 27, 2018

SUMMARY:

The relationship between the educational institution and the deceased arose from a contract.
Therefore, the former cannot be held liable under Art. 2180 of the New Civil Code, as the
said provision governs quasi-delicts, which is extra-contractual.

FACTS:
Carlitos Bautista is a junior college student enrolled in the Philippine School of Business
Administration (PSBA). Unfortunately, he was killed in a stabbing incident that occurred
inside the school premises. The assailant is an outsider to the school.

The present case was brought by the parents of the deceased before the Regional Trial Court
of Manila against the school and its officers for damages for the death of their son. The suit
impleaded the school and various school officials. The parents of Carlitos Bautista alleged
that the defendants were negligent and did not provide adequate security measures to protect
their students.

Defendants argued, however, that they are not covered by Article 2180 of the New Civil
Code, under which they are sued. They asserted that the cause of action is hinged on quasi-
delict, which requires that there be no contract between the parties. However, their son’s
enrolment in the school evinces the existence of a contract. Therefore, they sought to dismiss
the petition, which was denied by the trial court and the Court of Appeals (CA).

Hence, this petition.

ISSUES:
1. Is PSBA civilly liable under Art. 2180? NO.
2. Should the case be dismissed? NO.

RATIO:
The present case cannot be tried under Art. 2180

Art. 2180 governs quasi-delicts. Quasi-delicts are extra-contractual; that is, it only arises
when there is no prior contract between the parties of the case. The Court explained that the
deceased, upon enrolling the academic institution, entered into a contract with them:

“When an academic institution accepts students for enrollment, there is established

a contract between them, resulting in bilateral obligations which both parties are bound to
comply with. For its part, the school undertakes to provide the student with an education that
would presumably suffice to equip him with the necessary tools and skills to pursue higher
education or a profession. On the other hand, the student covenants to abide by the school’s
academic requirements and observe its rules and regulations.

Institutions of learning must also meet the implicit or “built-in” obligation of providing their
students with an atmosphere that promotes or assists in attaining its primary undertaking of
imparting knowledge. Certainly, no student can absorb the intricacies of physics or higher
mathematics or explore the realm of the arts and other sciences when bullets are flying or
grenades exploding in the air or where there looms around the school premises a constant
threat to life and limb. Necessarily, the school must ensure that adequate steps are taken to
maintain peace and order within the campus premises and to prevent the breakdown thereof.”

Thus, the CA was correct in dismissing PSBA’s petition, but it erred by grounding its
decision on this article.

Further proceedings are needed.

Because of the existence of a contractual relations between the parties, the cause of action
should be based on breach of contract. However, there is no material finding of fact on
whether the contract between the school and the student has been breached. Hence, the lower
court must still hear the case on the basis of more material evidence and facts to investigate if
there was indeed a breach of contract. The case was thus remanded to the RTC.
 Amadora vs. Court of Appeals, G.R. No.
L-47745, April 15, 1988
SEPTEMBER 27, 2018

FACTS:
Alfredo Amadora (victim) died after being mortally hit by a gun fired by his classmate in the
auditorium of Colegio de San Jose Recoletos (CSJR). Both the victim and the offender were
graduating 17-year-old students. The crime happened 3 days before graduation ceremony.
The student was convicted of homicide through reckless imprudence.

Additionally, the victim’s parents filed a civil action for damages under Art. 2180 of the New
Civil Code against the school, its principal, dean, physics teacher, the offender, two other
students, and their parents.

The respondent Court reversed the decision of the Court of First Instance of Cebu and
absolved ALL defendants on the grounds that:

 2180 of the New Civil Code is not applicable to CSJR because it is not a school of arts
and trades but an academic institution.
 The semester had already ended, thus the students were no longer in the custody of
the school.
 There was no clear identification of the fatal gun
 The defendants exercised the necessary diligence in preventing injury.

ISSUES:
1. Is Art. 2180 of the New Civil Code applicable to establishments which are technically
not schools of arts and trades? – YES.
2. Were the students considered under the custody of the defendants at the time of the
crime? – YES.
3. Are the defendants liable for damages under Art. 2180 of the New Civil Code? – NO.

RULING:
None of the respondents is liable for the injury inflicted by their students against the victim
student.

RATIO:
Art. 2180 of the New Civil Code should apply to all schools, academic and non-academic.
The general rule is that all teachers shall be held liable for the acts of their students. The
exception to the rule is where the school is technical in nature, it is the head thereof who
should be held responsible. There is no substantial distinction between the academic and non-
academic schools in so far as torts committed by their students are concerned. The reasons
for disparity in liability of teachers and heads are no longer material at present BUT Art.
2180 remains unchanged and must be interpreted according to its clear legislative intent until
further amendment

The students are considered to be at the custody of the school authorities at the time of the
crime.

Custody is not co-terminous with the semester. The student shall be considered to be in the
custody of the school authorities as long as he is under the control and influence of the school
and within its premises. As long as the student is in school fora legitimate student purpose,
legitimate exercise of student rights and privileges, the responsibility of the school authorities
continues

Custody does not connote actual and physical control, but refers more to the influence on the
child and the discipline instilled in him. Art. 2180 of the New Civil Code directly imposes
liability on the teacher or the head is technical school and not on the school itself. If any, the
school may be held to answer for acts of the teachers or heads and may be allowed to
exculpate liability by proof of exercise of diligence The same provision treats parents more
favorably than teachers. Unlike parents who are only liable for children until they turn 18
years old, teachers are held answerable by law for acts of students regardless of their age.
Nevertheless, there is leniency in assessing liability of teachers especially in cases where
students involved are no longer minors

None of the defendants may be held liable for damages.

As to the principal and the dean, they only exercise general authority since they were not
teachers-in-charge. The Dean of boys could have been held liable in view of the undisputed
evidence on his confiscation of an unlicensed gun from one of the students, which he
returned without any disciplinary measures. However, there’s no proof of the identity of the
gun used against the victim.

As to the Physics teacher, his absence during the time of the crime is not considered
negligence because he was not required to be in school at the time. The Teacher-in-charge of
the erring student was not identified.

As to the school, it may not be held liable under Art. 2180 of the New Civil Code
VILLAROEL vs ESTRADA G.R. No. 47362 December 19,
1940

FACTS:

On May 9, 1912, Alejandro Callao, mother of Juan Villaroel, obtained a loan of P1,000 from
spouses Mariano Estrada and Severina payable after seven years.

Alejandra died, leaving Juan Villaroel as sole heir, Spouses Mariano Estrada and Severina also
died, leaving Bernardino Estrada as sole heir.

On August 9, 1930, Juan Villaroel signed a document in which he declared to pay the debt of
his deceased mother in the amount of P1,000 with legal interest of 12% per annum.

The Court of First Instance of Laguna ordered Juan Villaroel to pay the amount of P1,000 with
an interest of 12% per annum since August 9, 1930 until full payment

Villaroel appealed.

ISSUE: Whether or not the right to prescription may be waived or renounced.

HELD: Yes, right to prescription may be waived or renounced. As a general rule, when a debt
has already prescribed, it cannot be imposed by the creditor. However, a new contract which
recognizes and assumes the prescribed debt is an exception, for it would be valid and
enforceable. Hence, a person who acknowledges the correctness of the debt and promises to
pay it despite knowing that the debt has already prescribed, such as the case at bar, waived
the benefit of the prescription.

Villaroel v. Estrada, G.R. No. L-

47262, 19 December 1940.

19
MAR
[AVANCEÑA, Pres.]

FACTS: On May 9, 1912, Alejandro F. Callao, the mother of the defendant Juan
F. Villarroel, obtained from the spouses Mariano Estrada and Severina a loan
of P1,000 payable after seven years. Alejandra died, leaving as sole heir to the
defendant. The spouses Mariano Estrada and Severina also died, leaving as
sole heir the plaintiff Bernardino Estrada. On August 9, 1930, the defendant
signed a document (Exhibit B) by which it declares the applicant to owe the
amount of P1,000, with an interest of 12 percent per year. This action deals with
the collection of this amount.

ISSUE: Is the defendant Juan under obligation to pay the loan that already
prescribed if he subsequently declared that he owed it to plaintiff Bernardino?

HELD: YES.

Although the action to recover the original debt has already been prescribed
when the claim was filed in this case, the question that arises in this appeal is
mainly whether, notwithstanding such a prescription, the action (may be)
brought. However, the present action is not based on the original obligation
contracted by the defendant’s mother, who has already been prescribed, but in
which the defendant contracted on August 9, 1930 upon assuming the
fulfillment of that obligation, Already prescribed. Since the defendant is the sole
inheritor of the primitive debtor, with the right to succeed in his inheritance, that
debt, brought by his mother legally, although it has lost its effectiveness by
prescription, is now, however, for a moral obligation, which is consideration
Sufficient to create and render effective and enforceable its obligation
voluntarily contracted on August 9, 1930 in Exhibit B.

The rule that a new promise to pay a pre-paid debt must be made by the same
obligated person or by another legally authorized by it, is not applicable to the
present case in which it is not required to fulfill the obligation of the obligee
originally, but of which he voluntarily wanted to assume this obligation.

Fisher vs. Robb

69 Phil 101

FISHER v ROBB

FACTS:
Defendant John C. Robb was told by the board of directors of the Philippine Greyhound Club,
Inc. to make a business trip to Shanghai to study the operation of a dog racing course. In
Shanghai, defendant met plaintiff A.O. Fisher who was a manager of a dog racing course. Plaintiff
upon knowing defendant’s purpose of his trip, became interested in the Philippine Greyhound
Club and asked defendant if he could be one of the stockholders. Defendant answered in
affirmative which thereupon filed a blank subscription and sent Greyhound Club Php3,000 in
payment of the first installment of his subscription. Upon receiving a call from the said club, he
paid the second installment amounting to Php2,000. Due to manipulations of those who control
the said club and during defendant’s absence, the company was changed to “Philippine Racing
Club.” Defendant endeavored the investments of those who subscribed, particularly of that of
plaintiff. Defendant,. through sending a letter, assured plaintiff for any loss which he might
suffer in connection with Philippine Greyhound Club in the same that he could not expect
anyone to reimburse him for his own losses which were more than that of plaintiff.

ISSUE:
Whether a moral obligation will sustain an express executory promise

HELD:
NO. Defendant, although morally responsible because of the failure of the enterprise, is not a
consideration under Article 1261 of the Civil Code as an essential element for the legal existence
for an onerous contract which could bind the promisor to comply with his promise.

Article 1261 states, “there is no contract unless the following requisites exists: consent of the
contracting parties; definite object; consideration.” In the present case, it does not appear that
plaintiff consented to the said form of reimbursement. The first requisite of 1261 is lacking.

With regards of the third requisite, it is now a well-established rule that a mere moral obligation
arising from wholly ethical motives not connected with any legal obligation will not furnish a
consideration from an executory promise.
Gaite v. Fonacier
Facts:

Gaite was appointed by Fonacier as attorney-in-fact to contract any party for the
exploration and development of mining claims. Gaite executed a deed of assignment
in favor of a single proprietorship owned by him. For some reasons, Fonacier revoked
the agency, which was acceded to by Gaite, subject to certain conditions, one of which
being the transfer of ores extracted from the mineral claims for P75,000, of which
P10,000 has already been paid upon signing of the agreement and the balance to be
paid from the first letter of credit for the first local sale of the iron ores. To secure
payment, Fonacier delivered a surety agreement with Larap Mines and some of its
stockholders, and another one with Far Eastern Insurance. When the second surety
agreement expired with no sale being made on the ores, Gaite demanded the P65,000
balance. Defendants contended that the payment was subject to the condition that the
ores will be sold.

Issue:

(1) Whether the sale is conditional or one with a period

(2) Whether there were insufficient tons of ores

Held:

(1) The shipment or local sale of the iron ore is not a condition precedent (or
suspensive) to the payment of the balance of P65,000.00, but was only a suspensive
period or term. What characterizes a conditional obligation is the fact that its efficacy
or obligatory force (as distinguished from its demandability) is subordinated to the
happening of a future and uncertain event; so that if the suspensive condition does not
take place, the parties would stand as if the conditional obligation had never existed.

A contract of sale is normally commutative and onerous: not only does each one of the
parties assume a correlative obligation (the seller to deliver and transfer ownership of
the thing sold and the buyer to pay the price),but each party anticipates performance
by the other from the very start. While in a sale the obligation of one party can be
lawfully subordinated to an uncertain event, so that the other understands that he
assumes the risk of receiving nothing for what he gives (as in the case of a sale of hopes
or expectations,emptio spei), it is not in the usual course of business to do so; hence,
the contingent character of the obligation must clearly appear. Nothing is found in the
record to evidence that Gaite desired or assumed to run the risk of losing his right over
the ore without getting paid for it, or that Fonacier understood that Gaite assumed any
such risk. This is proved by the fact that Gaite insisted on a bond a to guarantee
payment of the P65,000.00, an not only upon a bond by Fonacier, the Larap Mines &
Smelting Co., and the company's stockholders, but also on one by a surety company;
and the fact that appellants did put up such bonds indicates that they admitted the
definite existence of their obligation to pay the balance of P65,000.00.

The appellant have forfeited the right court below that the appellants have forfeited
the right to compel Gaite to wait for the sale of the ore before receiving payment of the
balance of P65,000.00, because of their failure to renew the bond of the Far Eastern
Surety Company or else replace it with an equivalent guarantee. The expiration of the
bonding company's undertaking on December 8, 1955 substantially reduced the
security of the vendor's rights as creditor for the unpaid P65,000.00, a security that
Gaite considered essential and upon which he had insisted when he executed the deed
of sale of the ore to Fonacier.
(2) The sale between the parties is a sale of a specific mass or iron ore because no
provision was made in their contract for the measuring or weighing of the ore sold in
order to complete or perfect the sale, nor was the price of P75,000,00 agreed upon by
the parties based upon any such measurement.(see Art. 1480, second par., New Civil
Code). The subject matter of the sale is, therefore, a determinate object, the mass, and
not the actual number of units or tons contained therein, so that all that was required
of the seller Gaite was to deliver in good faith to his buyer all of the ore found in the
mass, notwithstanding that the quantity delivered is less than the amount estimated
by them.
 Gonzales vs. Heirs of Thomas and Paula Cruz
GR No. 131784

FACTS:
1. Petition for Review on Certiorari on decision of CA:
1. “WHEREFORE, premises considered, this Court hereby renders judgment in favor of the
defendant, Felix Gonzales, and against the plaintiffs, as follows:
i. Ordering the dismissal of the case;
ii. Sentencing the plaintiffs, jointly and severally, the sum of P20,000.00 as moral damages and the
other sum of P10,000.00 as and for attorney’s fees; and
iii. to pay the costs.”
2. CRUZ entered into a Contract of Lease/Purchase with Gonzales (sole proprietor and manager of
Felgon Farms) of a half-portion of a ‘parcel of land containing an area of 12 hectares, more or less,
and an accretion of 2 hectares, more or less, situated in Rodriguez Town, Province of Rizal’
UNDER TERMS:
1. Term of contract is for a period of one year upon the signing thereof.
2. After the period, GONZALES shall purchase the property P1,000,000.00, 2 years payable with
12% per annum interest subject to the devalued amount of the Philippine Peso, according to the
following schedule of payment:
i. Upon the execution of deed 50%
ii. 25% every 6 months thereafter
1. Payable within first 10 days of the beginning of each 6 months
3. GONZALES shall pay annual rental equivalent to P2,500.00 per hectare, upon the signing of this
contract
4. LESSORS (CRUZ) shall undertake to obtain a separate certificate over leased portion to the
LESSEE within a reasonable period of time which shall not in any case exceed four (4) years
i. A new Contract shall be executed by the herein parties which shall be the same in all respects with
this Contract of Lease/Purchase insofar as the terms and conditions are concerned.
3. GONZALES paid the P2,500.00 per hectare or P15,000.00 annual rental on the half-portion of the
property covered by certificate in accordance with the second provision of the Contract of
Lease/Purchase, took possession of the property, installing thereon the defendant Jesus
Sambrano as his caretaker.
1. Did not purchase the property immediately after the expiration of the one-year lease
2. Remained in possession of the property without paying the purchase price and without paying any
further rentals
4. CRUZ SENT LETTER TO GONZALES INFORMING DECISION TO RESCIND CONTRACT DUE
TO GONZALES BREACH
1. Demanded defendant to vacate the premises within 10 days from receipt of said letter.
5. GONZALES refused to vacate the property and continued possession, case brought against
GONZALES.
6. LESSOR, PAULA CRUZ DIED.
1. Final demand letter to vacate the premises was sent by the remaining lessors.
2. Title to the property remains in the name of CRUZ
3. Filed a complaint for recovery of possession of the property - subject of the contract with damages,
both moral and compensatory and attorney’s fees and litigation expenses.
7. SAMBRANO (FOR GONZALES), upon motion, declared in default for failure to file an answer
despite valid service of summons.
8. ISSUES SUBMITTED AT THAT TIME:
1. WON PAR 9 is a condition precedent before the defendant is to pay the down payment;
i. PAR 9: LESSORS (CRUZ) shall undertake to obtain a separate certificate over leased portion to the
LESSEE within a reasonable period of time which shall not in any case exceed four (4) years
ii. A new Contract shall be executed by the herein parties which shall be the same in all respects with
this Contract of Lease/Purchase insofar as the terms and conditions are concerned.
2. WON CRUZ can rescind the Contract of Lease/Purchase
3. WON CRUZ can terminate the Contract of Lease.
9. DECISION OF LOWER COURT: COMPLAINT DISMISSED.
 1. WON PAR 9 IS A CONDITION PRECEDENT BEFORE DOWNPAYMENT? –YES.
i. PAR 9 indicates CRUZ to obtain TCT for GONZALES within 4 years.
1. Thus, before a deed of Sale can be entered into between the plaintiffs and the defendant, the
plaintiffs have to obtain TCT in favor of GONZALES

2. WON CRUZ can rescind the Contract of Lease/Purchase –NO.

i. Failure of the plaintiffs to secure TCT, as provided for in the contract, does not entitle them to rescind
the contract
1. ART 1191: Power to rescind obligations is implied in reciprocal ones, in case one of the obligors
should not comply with what is incumbent upon him. The injured party may choose between the
fulfillment of the obligation, with the payment of damages in either case. He may seek rescission,
even after he has chosen fulfillment, if the latter should become impossible.’ The power to rescind
is given to the injured party.
2. Where the plaintiff is the party who did not perform, he is not entitled to insist upon the performance
of the contract by the defendant or recover damages by reason of his own breach
ii. CRUZ failed to comply with the conditions precedent after 2-1/2 years from the execution of the
contract so as to entitle them to rescind the contract. Although the contract stated that the same
be done within 4 years from execution, still, the defendant has to be assured that the land subject
of the case will be transferred in his name without any encumbrances
1. The failure to secure the Transfer Certificate of Title in favor of the defendant entitles not the
plaintiffs but, rather, the defendant to either rescind or to ask for specific performances.

3. WON CRUZ can terminate the Contract of Lease. –NO

i. Article 1670 of the New Civil Code states that:
1. If at the end of the contract the lessee should continue enjoying the thing leased for fifteen days
with the acquies[c]ence of the lessor and unless a notice to the contrary by either party has
previously been given, it is understood that there is an implied new lease

10. CA REVERSED TRIAL COURT DECISION.

1. Transfer of title to the property cannot be interpreted as a condition precedent to the payment of
the agreed purchase price because such interpretation IS COUNTER-EXPLICIT and CONTRARY
TO NORMAL COURTS OF SALE OF REAL PROPERTIES.
2. Normal course: There must first be payment of the agreed purchase price before transfer of title
to the vendee’s name can be made.
3. Reason for this four (4) year period is [that] title to the property still remains in the name of the
original owners, the predecessors-in-interest of the herein appellants and [transferring] the title to
their names and eventually to the lessee-purchaser, appellee herein, would take quite some time.
4. GONZALES wanted to have the title to the property transferred in his name first before he
exercises his option to purchase allegedly in accordance with the ninth provision of the
contract. But the ninth provision does not give him this right:
i. 4-year period asked for by the appellants within which to have title to the property transferred in the
appellee’s name will only start to run when the appellee exercises his option to purchase.
5. Since the appellee never exercised his option to purchase, then appellee is not entitled to have
the title to the property transferred in his name.”

ISSUES:
WON CA has gravely erred and committed grave abuse of discretion in the interpretation of [the]
law between the parties.
WON CA committed serious mistakes in the finding of facts which resulted [in] departing from the
usual course of judicial proceedings.
For these issues to be resolved, petitioner asks this Court to answer the following questions:
Is there a conflict between the statement in paragraph 1 of the Lease/Purchase Contract and that
[in] paragraph No. 9 thereof?
Is paragraph 9 of the Lease/Purchase Contract a condition precedent before petitioner could
exercise his option to buy the property?
Can plaintiff rescind or terminate the Contract of Lease after the one-year period?”
 HELD:
PETITION GRANTED; appealed decision is REVERSED and SET ASIDE.
The Decision of the trial court is REINSTATED, but the award of moral damages and attorney’s
fees is DELETED for lack of basis. No costs.

1. WON CA has gravely erred and committed grave abuse of discretion in the interpretation of [the]
law between the parties. –YES.
1. CA relied on a literal interpretation to the effect that the TCT should be obtained in the name of the
petitioner-vendee.
i. It reasoned that the title could be transferred to the name of the buyer only after the completion of the
purchase. Thus, petitioner should first purchase the property before respondents could be obliged
to transfer the TCT to his name.
2. WE DISAGREE. PAR 9 does not say that the TCT should be obtained in the name of the lessee.
i. In fact, PAR 9 requires respondents to obtain a “TCT over the herein leased portion to the LESSEE,”
thereby showing that the crucial phrase “to the LESSEE” adverts to “the leased portion” and not to
the name which should appear in the new TCT.
ii. If GONZALES should purchase the property first before the title can be transferred to his name, why
should there be a waiting period of four years before the parties can execute the new contract
evidencing the sale? Why should the petitioner still be required to pay rentals after it purchases
and pays for the property?
3. PAR 9 can only mean that the respondents should first obtain a TCT in their names, after which
petitioner is given time to purchase and pay for the property.
4. RECORDS SHOW THAT the land in question respondents’ predecessors-in-interest.
i. No showing whether respondents were the only heirs.
ii. They admit that extrajudicial proceedings were still ongoing.
iii. Hence, when the Contract of Lease/Purchase was executed, there was no assurance that the
respondents were indeed the owners of the specific portion of the lot that petitioner wanted to buy,
and if so, in what concept and to what extent.
iv. Thus, the clear intent of the ninth paragraph was for respondents to obtain a separate and distinct
TCT in their names.
1. This was necessary to enable them to show their ownership of the stipulated portion of the land
and their concomitant right to dispose of it.
2. Absent any title in their names, they could not have sold the disputed parcel of land.
5. Because the property remained registered in the names of their predecessors-in-interest, private
respondents could validly sell only their undivided interest in the estate of predecessor, the extent
of which was however not shown in the records.
6. There being no partition of the estate thus far, there was no guarantee as to how much and which
portion would be adjudicated to respondents.
7. They could not deliver ownership or title to a specific portion of the yet undivided property.
8. Parties under PAR 9 wanted the specific portion of the land to be segregated, identified and
specifically titled.
i. Hence, by the said Contract, the respondents as sellers were given a maximum of four years within
which to acquire a separate TCT in their names, preparatory to the execution of the deed of sale
and the payment of the agreed price in the manner described in PAR 9.
1. P50,000 advance given by GONZALES is proof of helping them expedite the transfer of the TCT to
their names.
2. Ineluctably, intention of the parties was to have the title transferred first to respondents’ names as
a condition for the completion of the purchase.
2. WON CA committed serious mistakes in the finding of facts which resulted [in] departing from the
usual course of judicial proceedings.
1. PAR 9 required respondents to obtain a separate and distinct TCT in their names and not in the
name of petitioner
i. Logically follows that it was condition precedent to the latter’s obligation to purchase and pay for the
land.
ii. CONDITION: every future and uncertain event upon which an obligation or provision is made to
depend.
 1. It is a future and uncertain event upon which the acquisition or resolution of rights is made to depend
by those who execute the juridical act.
2. Without it, the sale of the property under the contract cannot be perfected, and petitioner cannot
be obliged to purchase the property.
3. When obligation assumed by a party to a contract is expressly subjected to a condition, the
obligation cannot be enforced against him unless the condition is complied with.
i. Obligatory force of a conditional obligation is subordinated to the happening of a future and uncertain
event, so that if that event does not take place, the parties would stand as if the conditional
obligation had never existed.
3. Can plaintiff rescind or terminate the Contract of Lease after the one-year period?” –
NO. BECAUSE THEY HAVE NOT CAUSED TRANSFER OF TCT TO THEIR NAMES.
1. There can be no rescission (or more properly, resolution) of an obligation as yet non-existent,
because the suspensive condition has not happened.

Romulo Coronel vs Court of Appeals ,

Conception Alcaraz
BY IAMFREAKGEEK
FACTS:

This case is about a sale of land in Roosevelt Avenue, Quezon City by

the vendor Romulo Coronel to the vendees Conception Alcaraz and her
daughter Ramona Patricia Alcaraz with the following conditions:

• The Coronel’s will immediately transfer the certificate of title in their

name upon receipt of the downpayment which is ₱50,000.
• Upon the transfer in their names of the subject property, the Coronel’s
will execute the deed of absolute sale in favor of Ramona and then
Ramona shall immediately pay the Coronel’s the whole balance of
₱1,190,000.

On January 15, 1985, Conception paid the downpayment of ₱50,000

and then on February 6, 1985, the property was now registered under
the name of Coronel’s. By Feb. 18, 1985, the Coronel’s sold the property
to Catalina B. Mabanag for ₱1,580,000 after she made a ₱300,000
downpayment. This is the reason why the Coronel’s cancelled and
rescind the contract with the Alcaraz by depositing back the ₱50,000 to
Ramona’s bank account.

On Feb. 22, Conception filed a complaint for specific performance

against the Coronel’s. On April, the Coronel’s executed a deed of
absolute sale over the subject property to Catalina after which on June
Catalina was issued a new title over the subject property.

ISSUE:

Whether or not the “Receipt of Down payment” embodied a perfected

contract of sale or just a mere contract to sell?

HELD:

• CONTRACT OF SALE- contracting parties obligates himself to transfer

the ownership and to deliver a determinate thing and the other to
pay a price certain in money or its equivalent.
• CONTRACT TO SELL- the prospective seller explicitly reserves the
transfer of the title to the prospective buyer, meaning the seller
does not yet agree or consent to transfer the ownership of the
property until the happening of a contingent event like full payment
of price.

SUPREME COURT RULING:

 When the “Receipt of Down Payment” document was
prepared and signed by Romulo Coronel, the parties had agreed to a
conditional contract of sale the consummation of the contract is subject
only to the successful transfer of the certificate of Title.

According to Supreme Court, the receipt of down payment document

manifests a clear intent of the Coronel’s to transfer the title to the buyer,
but since the title is still in the name effect the transfer even though the
buyers are able and willing to immediately pay the purchase price. The
agreement as well could not have been a contract to sell because the
seller or the Coronel’s made no express reservation of ownership or the
title of the land.

On Feb. 6, 1985, the Contract of Sale between the Coronel’s and the
Alcaraz’ became obligatory.

PARKS v. PROVINCE OF TARLAC

FACTS:

In 1910, Concepcion Cirer and James Hill donated parcels of land to the municipality
of Tarlac on the condition that it be used absolutely and exclusively for the erection
of a central school and public parks, the work to commence within six months. The
president of the municipality of Tarlac accepted and registered the donation.

In 1921, Cirer and Hill sold the same property to George L. Parks.
Later on the, the municipality of Tarlac transferred their rights in the property to the
Province of Tarlac.
Parks filed a complaint seeking the annulment of the donation and asking that he be
declared the absolute owner of the property. Parks allege that the conditions of the
donation were not complied with.

ISSUE:

Whether or not the donation was coupled with a condition precedent? W/N the action
to revoke has prescribed?

HELD:

No. The condition to erect a school within six months is not a condition precedent.
The characteristic of a condition precedent is that the acquisiito of the right is not
effected while said condition is mot complied with or is not deemed complied with.
Meanwhile nothing is acquired and there is only an expectancy of a right.
Consequently, when a condition is imposed, the compliance of which cannot be
effected except when the right is deemed acquired, such condition cannot be a
condition precedent. In the present case the condition that a public school be erected
and a public park be made of the donated land could not be complied with except
after giving effect to the donation.

The action to revoke the donation has prescribed. The prescriptive periods are: 5
years for the revocation by the subsequent birth of children, 1 year if by reason of
ingratitude. If no special period is prescribed, 10 years, for an onerous donation
following the law of contracts and general rules on prescriptions. The donation was
made in 1910, the cause of action accrued in 1911, while the action to revoke was
filed 1924, twenty three years later.
Central Philippine University v CA

When a person donates land to another on the condition that a construction be

made, the condition is akin to a resolutory (not suspensive) one. The non-
compliance to the condition extinguishes the right to the donation, but it need not
occur first in order for the donation to be effected and validated.
FACTS:

In 1939, the late Don Ramon Lopez was a member of the board of trustees of
Central Philippine University when he executed a donation to the school, stating that
the land must be for exclusive use of a medical college. 50 years later, The heirs of
Ramon Lopez filed an action to annul the donation, stating the failure of the school to
construct the medical college over the land. RTC ruled in favor of respondents,
which the CA affirmed.

ISSUE: Whether there is a resolutory condition

RULING:

The donation was an onerous one, where failure of the school to construct a medical
college would give the heirs the power to revoke the donation, reverting the property
back to the heirs of the donor. It is therefore a resolutory condition. Although, the
period was not stated, and the courts should have fixed a period, in this case, 50
years has lapsed since the donation was executed, thus fixing a period would serve
no purpose and the property must already be reverted back.

Dissenting Opinion:
Davide considered the donation as "modal" where the obligations are unconditional,
and the fulfillment, performance, existence or extinguishment is not dependent on
any future and uncertain event. It is more accurate to say that the condition stated is
not a resolutory condition, rather a obligation itself, being an onerous donation. Since
this is an onerous donation, it has to comply with the rules on Oblicon, and therefore
the courts should have fixed a period.

QUIJADA VS. CA- Resolutory Condition in

Donations

When a person donates land to another on a condition. The condition imposed is not
a condition precedent or a suspensive condition but a resolutory one.
FACTS:

Petitioners are the children of the late Trinidad Quijada. Trinidad and her siblings
executed a deed of donation of a two-hectare lot in favor of the Municipality of
Talacogon (Agusan del Sur), exclusively for the purpose of constructing the
proposed provincial high school. However, possession remained with Trinidad. She
subsequently sold the two hectares on two separate occasions to Regalado
Mondejar, who sold it to different persons. Eventually, the Municipality, failing to
construct the high school, reverted ownership to the donors. Petitioners filed an
action for quieting of title and recovery of possession and ownership. RTC ruled in
favor of petitioners, but CA reversed.

ISSUE:

Whether the deed of donation had a suspensive condition or a resolutory condition

Whether the sale was valid

RULING:

When the donation was accepted, the ownership was transferred to the school, only
subject to a condition that a school must be constructed over the lot. Since
ownership was transferred, and failure to fulfill the condition reverts the ownership
back to the donor, it is a resolutory condition.

(Not really a discussion in Property) When Trinidad sold the parcels of land to
Mondejar, she was not the owner of the land. Petitioners also did not sleep on their
rights to recover the possession and ownership over the property since they
immediately filed the action when the municipality passed the resolution, reverting
the ownership of land to the donors. However, a sale being a consensual contract, it
can be perfected upon meeting of the minds, and completing the three essential
elements of a valid contract of sale. Even when Trinidad was not the owner when the
sale was perfected, tradition through delivery is only important upon the
consummation stage. Such transfer of ownership through actual or constructive
delivery only happened when the lands reverted back to petitioners. Art 1434 is
applicable, stating that seller's "title passes by operation if law to the buyer," and
therefore making the sale valid. The donated lots cannot be considered outside the
commerce of man, since nowhere in the law states that properties owned by
municipality would be as such.

Central Philippine University vs. Court of Appeals

Donee (D) vs. Heirs of donor (P)
GR 112127 [T]

Summary: A donor donated a parcel of land to the donee school with a resolutory condition that a
medical school be constructed thereon. Fifty years elapsed, but the donee has not complied. The heirs
of the donor are now asking for rescission of the donation because of the donee's failure to comply.

Rule of Law: Under Article 1191 of the Civil Code, when one of the obligors cannot comply with the
conditions, the obligee may ask for rescission and the court shall grant the same unless there is just
cause authorizing the fixing of a period. In the absence of any, there is no more obstacle for the court
to decree the rescission claimed.

Facts: The late Don Ramon Lopez, Sr., who was then a member of the Board of Trustees of the
Central Philippine College—now Central Philippine University (CPU)—donated a parcel of land to the
Central Philippine University (D) with certain conditions.

The heirs (P) of Don Ramon Lopez, Sr., filed an action for the annulment of the donation,
reconveyance and damages against CPU (D) alleging that since 1939 up to the time the action was
filed the latter had not complied with the conditions of the donation. The heirs (P) also alleged that
CPU (D) had in fact negotiated with the National Housing Authority (NHA) to exchange the donated
property with another land owned by the latter.

In its answer, CPU (D) alleged that the right of the heirs (P) to file the action had prescribed and that
it did not violate any of the conditions in the deed of donation because it never used the donated
property for any other purpose than that for which it was intended and it did not sell, transfer or
convey it to any third party.

The trial court held that CPU (D) failed to comply with the conditions of the donation and declared it
null and void. The court a quo further directed CPU (D) to execute a deed of reconveyance of the
property in favor of the heirs (P) of the donor.

CPU (D) appealed the decision. The appellate court ruled that the annotations at the back of
petitioner's certificate of title were resolutory conditions breach of which should terminate the rights
of the donee thus making the donation revocable. Further, while the first condition mandated CPU
(D) to utilize the donated property for a medical school, the donor did not fix a period within which
the condition must be fulfilled, hence, until a period was fixed for the fulfillment of the condition, CPU
(D) could not be considered as having failed to comply with its part of the bargain. Thus, the appellate
court rendered its decision reversing the appealed decision and remanding the case to the court of
origin for the determination of the time within which CPU (D) should comply with the first condition
annotated in the certificate of title.
Issues: Should the resolutory condition of the deed of donation take effect and thus, extinguish the
rights of donee over the donated property?

Ruling: Yes. Records are clear and facts are undisputed that since the deed of donation up to the
filing of the case, CPU (D) has failed to comply with its obligation as donee. CPU (D) has slept on its
obligation for an unreasonable length of time. Hence, it is only just to declare the subject donation
ineffective and, for all purposes, revoked. CPU (D) as donee should now return the donated property
to the heirs (P) of the donor by means of reconveyance.

A review of the conditions in the deed of donation leads to the conclusion that the donation was
onerous—one executed for a valuable consideration which is considered the equivalent of the donation
itself. When Don Ramon Lopez donated the parcel of land to CPU (D) but imposed an obligation upon
the latter to establish a medical college thereon, the donation must be for an onerous consideration.

Under Article 1181 of the Civil Code, on conditional obligations, the acquisition of rights, as well as the
extinguishment or loss of those already acquired, shall depend upon the happening of the event which
constitutes the condition. Thus, when a person donates land to another on the condition that the latter
would build upon the land a school, the condition imposed was not a condition precedent or a
suspensive condition but a resolutory one.
—Parks vs. Province of Tarlac, 49 Phil. 142 (1926).

It is not correct to say that the schoolhouse had to be constructed before the donation became
effective, that is, before the donee could become the owner of the land, otherwise, it would be invading
the property rights of the donor. The donation had to be valid before the fulfillment of the condition.
—Parks vs. Province of Tarlac, supra.

If there was no fulfillment or compliance with the condition, such as what obtains in the instant case,
the donation may now be revoked and all rights which the donee may have acquired under it shall be
deemed lost and extinguished.

When the obligation does not fix a period but from its nature and circumstances it can be inferred that
a period was intended, the general rule provided in Article 1197 of the Civil Code applies, which
provides that the courts may fix the duration thereof because the fulfillment of the obligation itself
cannot be demanded until after the court has fixed the period for compliance therewith and such
period has arrived.
—Concepcion vs. People, 74 Phil. 63 (1942).
However, this general rule cannot be applied because of different circumstances. More than fifty (50)
years has elapsed to allow CPU (D) to comply with the conditions, however burdensome, to make the
donation forever valid in its favor. Unfortunately, it didn't. Hence, there is no need to fix the duration
of a term of the obligation when such procedure would serve no purpose than to delay or lead to an
unnecessary and expensive multiplication of suits.

Moreover, under Article 1191 of the Civil Code, when one of the obligors cannot comply with the
conditions, the obligee ask for rescission and the court shall grant the same unless there is just cause
authorizing the fixing of a period. In the absence of any, there is no more obstacle for the court to
decree the rescission claimed.

Finally, since the deed of donation herein is basically a gratuitous one, doubts referring to incidental
circumstances of a gratuitous contract should be resolved in favor of the least transmission of rights
and interests. (Article 1378, Civil Code)