ISSUE:
Was the cancellation by GSIS of the award in favor
of petitioner Agcaoili just and proper?
RULING:
No. It was the duty of the GSIS, as seller, to deliver
the thing sold in a condition suitable for its enjoyment by
the buyer for the purpose contemplated. There would be
no sense to require the awardee to immediately occupy and
live in a shell of a house, structure consisting only of four
walls with openings, and a roof. GSIS had an obligation to
deliver to Agcaoili a reasonably habitable dwelling in
return for his undertaking to pay the stipulated price.
Since GSIS did not fulfill that obligation, and was not
willing to put the house in habitable state, it cannot invoke
Agcaoilis suspension of payment of amortizations as cause
to cancel the contract between them. It is axiomatic that
In reciprocal obligations, neither party incurs in delay if
the other does not comply
liquidated damages.
ISSUE:
Should Tabora be exempted from liability because
of fortuitous event?
RULING:
No. Though it was agreed that the title of the
ownership of the books should remain with the seller until
the purchase price shall have been fully paid, it was also
expressly agreed upon that the loss or damage after
delivery shall be borne by the buyer. In pursuance of the
contract, the ownership of the goods has been retained by the seller merely to
secure performance by the buyer of his
obligation. Moreover, the goods were at the buyers risk
from the time of the delivery.
21 SCRA 279
FACTS:
In the early afternoon of August 17, 1960, barge L1892, owned by the Luzon Stevedoring Corporation was
being towed down the Pasig River by two tugboats when
the barge rammed against one of the wooden piles of the
Nagtahan bailey bridge, smashing the posts and causing
the bridge to list. The river, at the time, was swollen and
the current swift, on account of the heavy downpour in
Manila and the surrounding provinces on August 15 and
16, 1960.
The Republic of the Philippines sued Luzon
Stevedoring for actual and consequential damage caused
by its employees, amounting to P200,000. Defendant
Corporation disclaimed liability on the grounds that it had
exercised due diligence in the selection and supervision of
its employees that the damages to the bridge were caused
by force majeure, that plaintiff has no capacity to sue, and
that the Nagtahan bailey bridge is an obstruction to
navigation.
After due trial, the court rendered judgment on
June 11, 1963, holding the defendant liable for the damage
caused by its employees and ordering it to pay plaintiff the
actual cost of the repair of the Nagtahan bailey bridge
which amounted to P192,561.72, with legal interest from
the date of the filing of the complaint.
ISSUE:
Was the collision of appellant's barge with the
supports or piers of the Nagtahan bridge caused by
ISSUE:
In a loan with usurious interest, may the creditor
recover the principal of the loan?
RULING:
Great reliance is made by appellants on Art. 1411 of
the New Civil Code which states:
Art. 1411. When the nullity proceeds from the illegality of
the cause or object of the contract, and the act constitutes
criminal offense, both parties being in pari delicto, they
shall have no action against each other, and both shall be
prosecuted. Moreover, the provisions of the Penal Code
relative to the disposal of effects or instruments of a crime
shall be applicable to the things or the price of the
contract.
This rule shall be applicable when only one of the
parties is guilty; but the innocent one may claim what he
has given, and shall not be bound to comply with his
promise.
The Supreme Court do not agree with such
reasoning. Article 1411 of the New Civil Code is not new; it
is the same as Article 1305 of the Old Civil Code. Therefore,
said provision is no warrant for departing from previous
interpretation that, as provided in the Usury Law (Act No.
2655, as amended), a loan with usurious interest is not
totally void only as to the interest.
True, as stated in Article 1411 of the New Civil
Code, the rule of pari delicto applies where a contract's nullity proceeds from
BRIONES VS CAMMAYO
GR 23559 October 4, 1971
FACTS:
Aurelio G. Briones filed an action in the Municipal
Court of Manila against Primitivo, Nicasio, Pedro, Hilario
and Artemio, all surnamed Cammayo, to recover from
them, jointly and severally, the amount of P1,500.00, plus
damages, attorney's fees and costs of suit.
Defendants executed the real estate mortgage as
security for the loan of P1,200.00 given to Primitivo P.
Cammayo upon the usurious agreement that defendant
pays to the plaintiff, out of the alleged loan of P1,500.00
(which includes as interest the sum of P300.00) for one
year.
Although the mortgage contract was executed for
securing the payment of P1,500.00 for a period of one
year, without interest, the truth and the real fact is that
plaintiff delivered to the defendant Primitivo P. Cammayo
only the sum of P1,200.00 and withheld the sum of
P300.00 which was intended as advance interest for one
year.
On account of said loan of P1,200.00, defendant
Primitivo P. Cammayo paid to the plaintiff during the
period from October 1955 to July 1956 the total sum of
P330.00 which plaintiff, illegally and unlawfully refused to
acknowledge as part payment of the account but as in
interest of the said loan for an extension of another term of
one year.
ISSUE:
Can Briones recover the amount of P1,500.00?
RULING:
Loan is valid but usurious interest is void. Creditor
has the right to recover his capital by judicial action. To
discourage stipulations on usurious interest, said
stipulations are treated as wholly void, so that the loan
becomes one without stipulation as to payment of interest.
It should not, however, be interpreted to mean forfeiture
even of the principal, for this would unjustly enrich the
borrower at the expense of the lender. Furthermore, penal
sanctions are available against a usurious lender, as a
further deterrence to usury.
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 (Article 1350, Civil
Code), is not illegal. The illegality lies only as to the