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ARTICLE 1157 Sagrada Orden vs.

National Coconut Corporation (91 SCRA 503) Facts Petitioner, Sagrada Orden owned a land which was acquired by a Japanese corporation during the Japanese military occupation. After the liberation, the Alien Property Custodian took possession, control and custody of the land. The Copra Export Management Company occupied the property and when it vacated, the respondent, National Coconut Corporation occupied it through the representation made by the Philippine Government to the Alien Property Custodian. The property was returned to Sagrada Orden upon judgment that the contract of sale of the property in favour of the Japanese corporation was null and void and upon payment of the consideration it received for the property to the Philippine Alien Property Administration. Sagrada Orden was also given the right to recover from National Coconut Corporation reasonable rentals for the use and occupation of the premises. Sagrada Orden filed an action to recover rentals from National Coconut Corporation from the time it used and occupied the premises. National Coconut Corporation claimed that it was willing to pay only from the time the property was returned to Sagrada Orden and not before, for it occupied the property in good faith, under no obligation to pay the rentals. Issue Was National Coconut Corporation liable for rentals prior to the date the property was returned to Sagrada Orden? Held No. National Coconut Corporation was not liable for the rentals prior to the date the property was returned to Sagrada Orden. For National Coconut Corporation to be liable, its obligation must arise from the law, contract or quasi- contract, crime or negligence as provided by Article 1157 of the Civil Code which was taken from Article 1089 of the old Civil Code. As none of these sources were present, National Coconut Corporation cannot be held liable. There was also no express agreement between the entity which had legal control and administration of the property and the National Coconut Corporation for the latter to pay rentals on the property so there was no obligation.

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