7.

Operators vs Americans- no digest

8. Alipio vs. Court of Appeals

Summary: A lease was executed by a husband and his wife together with another couple. Then, the
husband died. The lessor is suing the surviving wife as a solidary debtor.

Rule of Law: Spouses sued for the enforcement of an obligation entered into by them are being
impleaded in their capacity as representatives of the conjugal partnership and not as independent debtors
such that the concept of joint or solidary liability, as between them, does not apply.

Facts: Romeo Jaring (P) subleased a fishpond to spouses Alipio (D) and spouses Bienvenido and
Remedios Manuel for P485,600 payable in two installments. The first installment was paid, but the
second was only partly paid. Despite due demand, the balance remain unpaid. Jaring (P) filed a case to
collect the balance from the spouses Alipio (D) and spouses Manuel with a prayer for the alternative of
rescission. Purita Alipio (D) moved to dismiss the case because her husband died and thus, dissolving
their conjugal partnership. Alipio (D) contended that the proper action for Jaring (P) is to file a claim in
the settlement of the estate.

The trial court denied Alipio's (D) motion on the ground that since she was herself a party to the sublease
contract, she could be independently impleaded in the suit together with spouses Manuel and that the
death of her husband merely resulted in his exclusion from the case.

On appeal, the court applied the ruling on Climaco vs. Siy Uy finding the surviving spouse solidary liable.

Issues: Is the surviving spouse a solidary debtor for a lease she and her late husband entered into?

Ruling: No. For marriages governed by the rules of conjugal partnership of gains, an obligation entered
into by the husband and wife is chargeable against their conjugal partnership and it is the partnership
which is primarily bound for its repayment. (Rules of Court, Rule 79, §2) Thus, when the spouses are sued
for the enforcement of an obligation entered into by them, they are being impleaded in their capacity as
representatives of the conjugal partnership and not as independent debtors such that the concept of joint
or solidary liability, as between them, does not apply.

A creditor cannot sue the surviving spouse of a decedent in an ordinary proceeding for the collection of a
sum of money chargeable against the conjugal partnership and that the proper remedy is for him to file a
claim in the settlement of estate of the decedent.

The concurrence of two or more creditors or of two or more debtors in one and the same obligation does
not imply that each one of the former has a right to demand, or that each one of the latter is bound to
render, entire compliance with the prestations. There is a solidary liability only when the obligation
expressly so states, or when the law or the nature of the obligation requires solidarity.
—Article 1207, Civil Code

If from the law or the nature or the wording of the obligation the contrary does not appear, an obligation
is presumed to be only joint, i.e., the debt is divided into as many equal shares as there are debtors, each
debt being considered distinct from one another. (Article 1208, Civil Code)
However,

Should the lessees or sub-lessees refuse to vacate the leased property after the expiration of the lease
period and despite due demands by the lessor, they can be held jointly and severally liable to pay for the
use of the property. The basis of their solidary liability is not the contract of lease or sublease but the fact
that they have become joint tortfeasors.
—Abalos vs. Court of Appeals, GR 106029, Oct. 19, 1999.

Reading the pertinent portion of the contract, it is clear that the liability of the sublessees is merely joint.
Since the obligation of the Manuel and Alipio spouses is chargeable against their respective conjugal
partnerships, the unpaid balance should be divided into two.
 9. SPOUSES LAMvs.KODAK PHILIPPINES, LTD.
G.R. No. 167615; January 11, 2016
LEONEN, J.:

Facts:

 On January 8, 1992, the Lam Spouses and Kodak Philippines, Ltd. entered into an
agreement (Letter Agreement) for the sale of three (3) units of the Kodak Minilab System
22XL6 (Minilab Equipment) in the amount of ₱1,796,000.00 per unit, with the following terms:

“This confirms our verbal agreement for Kodak Phils., Ltd. To provide Colorkwik
Laboratories, Inc. with three (3) units Kodak Minilab System 22XL . . . for your proposed
outlets in Rizal Avenue (Manila), Tagum (Davao del Norte), and your existing Multicolor
photo counter in Cotabato City under the following terms and conditions:

1. Said Minilab Equipment packages will avail a total of 19% multiple order discount
based on prevailing equipment price provided said equipment packages will be
purchased not later than June 30, 1992.

2. 19% Multiple Order Discount shall be applied in the form of merchandise and
delivered in advance immediately after signing of the contract.* Also includes start-up
packages worth P61,000.00.

3. NO DOWNPAYMENT.

4. Minilab Equipment Package shall be payable in 48 monthly installments at

THIRTY FIVE THOUSAND PESOS (P35,000.00) inclusive of 24% interest rate for
the first 12 months; the balance shall be re-amortized for the remaining 36 months
and the prevailing interest shall be applied.

5. Prevailing price of Kodak Minilab System 22XL as of January 8, 1992 is at ONE

MILLION SEVEN HUNDRED NINETY SIX THOUSAND PESOS.

6. Price is subject to change without prior notice.*Secured with PDCs; 1st monthly
amortization due 45 days after installation.”

 Kodak Philippines, Ltd. delivered one (1) unit of the Minilab Equipment in Tagum, Davao
Province. The delivered unit was installed by Noritsu representatives. The Lam Spouses
issued postdated checks amounting to ₱35,000.00 each for 12 months as payment for the
first delivered unit, with the first check due on March 31, 1992.
 The Lam Spouses requested that Kodak Philippines, Ltd. not negotiate the check dated
March 31, 1992 allegedly due to insufficiency of funds. The same request was made for the
check due on April 30, 1992. However, both checks were negotiated by Kodak Philippines,
Ltd. and were honored by the depository bank. The 10 other checks were subsequently
dishonored after the Lam Spouses ordered the depository bank to stop payment.
 Kodak Philippines, Ltd. canceled the sale and demanded that the Lam Spouses return the
unit. The Lam Spouses ignored the demand but also rescinded the contract through the
letter dated November 18, 1992 on account of Kodak Philippines, Ltd.’s failure to deliver the
two (2) remaining Minilab Equipment units.
  Kodak Philippines, Ltd. filed a Complaint for replevin and/or recovery of sum of money. The
Lam Spouses failed to appear during the pre-trial conference. Thus, they were declared in
default.
 Kodak Philippines, Ltd. presented evidence ex-parte. The trial court issued the Decision in
favor of Kodak Philippines, Ltd. ordering the seizure of the Minilab Equipment. Based on this
Decision, Kodak Philippines, Ltd. was able to obtain a writ of seizure for the Minilab
Equipment installed at the Lam Spouses’ outlet in Tagum, Davao Province. The writ was
enforced and Kodak Philippines, Ltd. gained possession of the Minilab Equipment unit,
accessories, and the generator set.
 The Lam Spouses then filed before the CA a Petition to Set Aside the Orders issued by the
trial court. These Orders were subsequently set aside by the CA, and the case was
remanded to the trial court for pre-trial.
 In itsDecision, the RTCdismissed the case and ordered the plaintiff to pay Lam Spouses
 Lam Spouses filed their Notice of Partial Appeal. Kodak Philippines, Ltd. also filed an appeal.
However, the CA dismissed it for Kodak Philippines, Ltd.’s failure to file its appellant’s brief,
without prejudice to the continuation of the Lam Spouses’ appeal. The Resolution became
final and executory.
 CA modified the decision of the RTC.

Issues:

(1) Whether the contract between petitioners Spouses Alexander and Julie Lam and respondent
Kodak Philippines, Ltd. pertained to obligations that are severable, divisible, and susceptible
of partial performance under Article 1225 of the New Civil Code; and
(2) Upon rescission of the contract, what the parties are entitled to under Article 1190 and Article
1522 of the New Civil Code.

Held:

(1) The Letter Agreement contained an indivisible obligation.

The intention of the parties is for there to be a single transaction covering all three (3) units of the
Minilab Equipment. Respondent’s obligation was to deliver all products purchased under a
"package," and, in turn, petitioners’ obligation was to pay for the total purchase price, payable in
installments.

The intention of the parties to bind themselves to an indivisible obligation can be further discerned
through their direct acts in relation to the package deal. There was only one agreement covering all
three (3) units of the Minilab Equipment and their accessories. The Letter Agreement specified only
one purpose for the buyer, which was to obtain these units for three different outlets. If the intention
of the parties were to have a divisible contract, then separate agreements could have been made for
each Minilab Equipment unit instead of covering all three in one package deal. Furthermore, the
19% multiple order discount as contained in the Letter Agreement was applied to all three acquired
units. The "no downpayment" term contained in the Letter Agreement was also applicable to all the
Minilab Equipment units. Lastly, the fourth clause of the Letter Agreement clearly referred to the
object of the contract as "Minilab Equipment Package."

In ruling that the contract between the parties intended to cover divisible obligations, the Court of
Appeals highlighted: (a) the separate purchase price of each item; (b) petitioners’ acceptance of
separate deliveries of the units; and (c) the separate payment arrangements for each unit.However,
through the specified terms and conditions, the tenor of the Letter Agreement indicated an intention
for a single transaction. This intent must prevail even though the articles involved are physically
separable and capable of being paid for and delivered individually, consistent with the New Civil
Code: Article 1225. For the purposes of the preceding articles, obligations to give definite things and
those which are not susceptible of partial performance shall be deemed to be indivisible. When the
obligation has for its object the execution of a certain number of days of work, the accomplishment of
work by metrical units, or analogous things which by their nature are susceptible of partial
performance, it shall be divisible. However, even though the object or service may be physically
divisible, an obligation is indivisible if so provided by law or intended by the parties.

In Nazareno v. Court of Appeals, the indivisibility of an obligation is tested against whether it can be
the subject of partial performance: An obligation is indivisible when it cannot be validly performed in
parts, whatever may be the nature of the thing which is the object thereof. The indivisibility refers to
the prestation and not to the object thereof. In the present case, the Deed of Sale of January 29,
1970 supposedly conveyed the six lots to Natividad. The obligation is clearly indivisible because the
performance of the contract cannot be done in parts, otherwise the value of what is transferred is
diminished. Petitioners are therefore mistaken in basing the indivisibility of a contract on the number
of obligors.

There is no indication in the Letter Agreement that the units petitioners ordered were covered by
three (3) separate transactions. The factors considered by the Court of Appeals are mere incidents
of the execution of the obligation, which is to deliver three units of the Minilab Equipment on the part
of respondent and payment for all three on the part of petitioners. The intention to create an
indivisible contract is apparent from the benefits that the Letter Agreement afforded to both parties.
Petitioners were given the 19% discount on account of a multiple order, with the discount being
equally applicable to all units that they sought to acquire. The provision on "no downpayment" was
also applicable to all units. Respondent, in turn, was entitled to payment of all three Minilab
Equipment units, payable by installments.

(2) The 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 fulfilment and the rescission of the obligation, with the
payment of damages in either case. He may also seek rescission, even after he has chosen
fulfilment, if the latter should become impossible.

The court shall decree the rescission claimed, unless there be just cause authorizing the fixing of a
period.

Rescission under Article 1191 has the effect of mutual restitution. In Velarde v. Court of
Appeals:Rescission abrogates the contract from its inception and requires a mutual restitution of
benefits received.

The Court of Appeals correctly ruled that both parties must be restored to their original situation as
far as practicable, as if the contract was never entered into. Petitioners must relinquish possession
of the delivered Minilab Equipment unit and accessories, while respondent must return the amount
tendered by petitioners as partial payment for the unit received. Further, respondent cannot claim
that the two (2) monthly installments should be offset against the amount awarded by the Court of
Appeals to petitioners because the effect of rescission under Article 1191 is to bring the parties back
to their original positions before the contract was entered into.

When rescission is sought under Article 1191 of the Civil Code, it need not be judicially invoked
because the power to resolve is implied in reciprocal obligations. The right to resolve allows an
injured party to minimize the damages he or she may suffer on account of the other party’s failure to
perform what is incumbent upon him or her. When a party fails to comply with his or her obligation,
the other party’s right to resolve the contract is triggered. The resolution immediately produces legal
effects if the non-performing party does not question the resolution. Court intervention only becomes
necessary when the party who allegedly failed to comply with his or her obligation disputes the
resolution of the contract. Since both parties in this case have exercised their right to resolve under
Article 1191, there is no need for a judicial decree before the resolution produces effects.

WHEREFORE, the Petition is DENIED.

10.) Quisumbing v. CA and PAL (1990)

Short version/ Summary:

Quisumbing and Loeffler are passenger of PAL flight from Mactan City to Manila.
Passengers also in the plane were an NBI agent and suspects in the killing of a judge. The
NBI agent recognized one “Zaldy” as the said suspect. He checked with the stewardess the
ticket of said passenger who, he found out, used an alias. The NBI agent then sent a note to
the pilot instructing him to alert NBI agents in Manila for the apprehension of the suspects
but the pilot refused because the message would be heard by all ground aircraft stations.
Later on, gun exchange ensued between the agent and the suspects. The suspects declared
a hold-up and valuables were taken from Quisumbing and Loffler. They both sued PAL for
indemnity. TC, CA and SC denied ruling that the armed robbery was force majeure.

Facts:
1. Norberto Quisumbing, Sr. and Gunther Leoffler were passengers of PAL plane with flight
from Mactan City to Manila.
2. After the plane took off, Florencio Villarin, a Senior NBI Agent, also a passenger of said
plane, noticed a certain 'Zaldy,' a suspect in the killing of Judge Valdez, seated at the front
seat near the door leading to the cockpit of the plane. Villarin checked the passenger's
ticket in the possession of the flight Stewardess seated at the last seat right row. It revealed
that 'Zaldy' used the name 'Cardente,' one of his aliases known to Villarin. Villarin also
came to know from the stewardess that 'Zaldy' had three companions on board the plane.
3. Villarin scribbled a note addressed to the pilot requesting him to contact NBI agents in
Manila to meet the plane because the suspect in the killing of Judge Valdez was on board.
The note was handed by Villarin to the stewardess who gave the same to the pilot.
4. After receiving the note, which was about 15 minutes after take off, the pilot, Capt. Luis
Bonnevie, Jr., came out of the cockpit and sat beside Villarin at the rear portion of the plane
and explained that he could not send the message because it would be heard by all ground
aircraft stations. Villarin told the pilot of the danger of commission of violent acts on board
the plane by the notorious 'Zaldy' and his three companions.
5. While the pilot and Villarin were talking, 'Zaldy' and one of his companions walked to the
rear and stood behind them. Capt. Bonnevie then stood up and went back to the cockpit.
'Zaldy' and his companions returned to their seats, but after a few minutes they moved
back to the rear throwing ugly looks at Villarin who, sensing danger, stood up and went
back to his original seat across the aisle on the second to the last seat near the window.
'Zaldy and his companion likewise went back to their respective seats in front.
6. Soon thereafter an exchange of gunshots ensued between Villarin and 'Zaldy' and the
latter's companions. 'Zaldy' announced a hold-up and ordered the pilot not to send any
SOS. The hold-uppers divested passengers of their belongings.
7. Quisumbing was divested of jewelries and cash in the total amount of P18,650, P4,550 of
which is recovered. Gunther Leoffler was divested of a wrist watch, cash and a wallet in the
total of P1,700.
8. Upon landing at the Manila International Airport. 'Zaldy' and his three companions
succeeded in escaping.
9. Quisuming and Loeffler demanded indemnity on PAL but PAL refused.
Quisumbing and Loeffler: the loss is a result of breach of PAL's contractual obligation to
carry them and their belongings and effects to Manila destination without loss or damage,
and constitutes a serious dereliction of PAL's legal duty to exercise extraordinary diligence
in the vigilance over the same. The complained-of act of the armed robbers is not a force
majeure, as the 'use of arms' or 'irresistible force' was not taken advantage of by said armed
robbers in gaining entrance to defendant's ill-fated plane.

PAL: the robbery during the flight and after the aircraft was forcibly landed at the Manila
Airport constituted force majeure.

Procedure: CFI ruled in favor of PAL. Robbery constitutes force majeure.

CA affirmed. It rejected the argument that "the use of arms or ... irresistible force" referred
to in Article 2001 constitutes force majeure only if resorted to gain entry into the airplane,
and not if it attends "the robbery itself." The Court ruled that under the facts, "the
highjacking-robbery was force majeure."

CA also ruled that in light of the evidence PAL could not be faulted for want of diligence,
particularly for failing "to take positive measures to implement Civil Aeronautics
Administration regulations prohibiting civilians from carrying firearms on board aircrafts;"
and that "the absence of coded transmissions, the amateurish behaviour of the pilot in
dealing with the NBI agent, the allegedly open cockpit door, and the failure to return to
Mactan, in the light of the circumstances of the case ..., were not negligent acts sufficient to
overcome the force majeure nature of the armed robbery."

Issue/s: WON PAL should be held liable?

Held/Ratio: NO.
A careful analysis of the record in relation to the memoranda and other pleadings of the
parties, convinces this Court of the correctness of the essential conclusion of both the trial
and appellate courts that the evidence does indeed fail to prove any want of diligence on
the part of PAL, or that, more specifically, it had failed to comply with applicable
regulations or universally accepted and observed procedures to preclude hijacking; and
that the particular acts singled out by the petitioners as supposedly demonstrative of
negligence were, in the light of the circumstances of the case, not in truth negligent acts
"sufficient to overcome the force majeure nature of the armed robbery." The Court agrees
with CA’s observation that PAL's "failure to take certain steps that a passenger in hindsight
believes should have been taken is not the negligence or misconduct which mingles with
force majeure as an active and cooperative cause.

CA affirmed.
11.) PNB vs Independent Planters Assoc
FACTS:

PNB filed with a now defunct CFI in Manila a complaint for the
collection of a sum of money against several solidary debtors.
After PNB had presented its evidence, one of the defendants,
Ceferino Valencia, died. Thus, the CFI dismissed the action,
holding that the complaint, being a money claim based on
contract, should be prosecuted in the testate or intestate
proceeding for the settlement of the estate of the deceased
defendant pursuant to Section 6 of Rule 86 of the Rules of Court
which reads:
SEC. 6. Solidary obligation of decedent.— If the obligation of
the decedent is solidary with another debtor, the claim shall be
filed against the decedent as if he were the only debtor,
without prejudice to the right of the estate to recover
contribution from the other debtor. In a joint obligation of the
decedent, the claim shall be confined to the portion belonging
to him.

The appellant assails the order of dismissal, invoking its right

of recourse against one, some or all of its solidary debtors
under Article 1216 of the Civil Code —
ART. 1216. The creditor may proceed against any one of the
solidary debtors or some or all of them simultaneously. The
demand made against one of them shall not be an obstacle to
those which may subsequently be directed against the others, so
long as the debt has not been fully collected.

ISSUE: Whether in an action for collection of a sum of money

based on contract against all the solidary debtors, the death of
one defendant deprives the court of jurisdiction to proceed with
the case against the surviving defendants

HELD: No
It is now settled that the quoted Article 1216 grants the
creditor the substantive right to seek satisfaction of his
credit from one, some or all of his solidary debtors, as he
deems fit or convenient for the protection of his interests; and
if, after instituting a collection suit based on contract
against some or all of them and, during its pendency, one of the
defendants dies, the court retains jurisdiction to continue the
proceedings and decide the case in respect of the surviving
defendants.

Manila Surety & Fidelity Co., Inc. vs. Villarama et al.,:

It is evident from the foregoing that Section 6 of Rule 87 (now
Rule 86) provides the procedure should the creditor desire to go
against the deceased debtor, but there is certainly nothing in
the said provision making compliance with such procedure a
condition precedent before an ordinary action against the
surviving solidary debtors, xxxx
Upon the other hand, the Civil Code expressly allows the
creditor to proceed against any one of the solidary debtors or
some or all of them simultaneously. There is, therefore, nothing
improper in the creditor's filing of an action against the
surviving solidary debtors alone, instead of instituting a
proceeding for the settlement of the estate of the deceased
debtor wherein his claim could be filed.

In PNB vs. Asuncion, Justice Makasiar, reiterated the doctrine.

...........As correctly argued by petitioner, if Section 6, Rule
86 of the Revised Rules of Court were applied literally, Art.
1216 of the New Civil Code would, in effect, be repealed since
under the Rules of Court, petitioner has no choice but to
proceed against the estate of Manuel Barredo only. Obviously,
this provision diminishes the Bank's right under the New Civil
Code to proceed against any one, some or all of the solidary
debtors. Such a construction is not sanctioned by the principle,
which is too well settled to require citation, that a
substantive law cannot be amended by a procedural rule.
Otherwise stated, Section 6, Rule 86 of the Revised Rules of
Court cannot be made to prevail over Article 1216 of the New
Civil Code, the former being merely procedural, while the
latter, substantive.

Case is remanded to the corresponding RTC for proceedings. No

costs.

12.) Vigilla vs Phil. College of Criminology

Law Principle:
Anything favorable to the labor-only contractor redounds to the benefit of the employer under the
principle of solidary liability

Facts:

The petitioners work for the Philippine College of Criminology Inc. (PCCr) as janitors, janitress and
supervisor in its maintenance department. The petitioners were made to understand by the
respondent PCCr that they are under the Metropolitan Building Services, Inc. (MBMSI) which is a
corporation engaged in providing janitorial services. PCCr terminated the services of MBMSI on
2009 which resulted in the dismissal of the petitioners. An illegal dismissal complaint was then filed
against PCCr by the petitioners contending that it is their real employer and not MBMSI.
Subsequently, the PCCr submitted to the Labor Arbiter waivers, releases and quitclaims that were
executed by the petitioners in favor to MBMSI.

The Labor Arbiter and NLRC ruled in favor of the petitioner, however upon filing the petition for
review on certiorari before the Court of Appeals, the CA ruled that the quitclaims, releases and
waivers executed by the petitioners in favor to MBMSI redounds to the benefit of PCCr by virtue of
solidary liability under Article 1217 of the NewCivil Code. The petitioners contend that under Article
106 of the Labor Code a labor-only contractor's liability is not solidary as it is the employer who
should be directly responsible to the supplied worker.

Issue

Whether or not the quitclaims, releases and waivers executed by the petitioners in favor to MBMSI
redounds to the benefit of PCCr?

Held

Yes.

The Supreme Court held that the basis of the solidary liability of the principal with those engaged in
labor-only contracting is the last paragraph of Article 106 of the Labor Code that provides, "In such
cases of labor-only contracting, the person or intermediary shall be considered merely as an agent
of the employer who shall be responsible to the workers in the same manner and extent as if the
latter were directly employed by him."

It also pointed out D.O. No. 18-A, s. 2011 section 27 providing for the effects of labor-only
contracting "where upon the finding by competent authority of labor-only contracting shall render the
principal jointly and severally liable with the contractor to the latter's employees, in the same manner
and extent that the principal is liable to employees directly hired by him/her, as provided in Article
106 of the Labor Code."

Hence, the PCCr's solidary liability was already expunged by virtue of the releases, waivers and
quitclaims executed by the petitioners in favor of MBMSI by virtue of Article 1217 of the Civil Code
providing that "payment made by one of the solidary debtors extinguishes the obligation."