Art.1164.

Thecreditorhasarighttothefruitsofthethingfromthetimetheobligationto
deliveritarises.However,heshallacquirenorealrightoverituntilthesamehasbeen
deliveredtohim.
COMMENT:(1)WhenCreditorIsEntitledtotheFruits
Example:AisobligedtogiveBonDec.3,2004,aparticularparcelofland.(BeforeDec.3,he
hasnorightwhatsoeveroverthefruits).AfterDec.3,2004,B,thecreditorisentitled(asof
111
Art.1164CIVILCODEOFTHEPHILIPPINES

right)tothefruits.Butifthefruitsandthelandareactuallyorconstructivelydeliveredonlyon
Dec.15,2004,Bbecomesownerofsaidfruitsandlandonlyfromsaiddate.BetweenDec.3
andDec.15,Bhadonlyapersonalright(enforceableagainstA);afterDec.15,hehasareal
right(overtheproperties),arightthatisenforceableagainstthewholeworld.
[NOTE:Apersonalrightisalsocalledjusinpersonamorjusadrem;arealrightisajusinre.
(SeeFidelityandDepositCo.v.Wilson,8Phil.51).Apersonalrightispowerdemandableby
onepersonofanothertogive,todo,ornottodo(3SanchezRoman6,8);arealrightisa
poweroveraspecificthing(liketherightofownershiporpossession)andisbindingonthe
wholeworld.(See3SanchezRoman6,8).]
[NOTE:Inthecaseofapurchaseofland,forexample,beforethelandisdelivered,theproper
remedyofthebuyer(sinceheisnotyettheowner)istocompelspecificperformanceand
delivery,andnotanaccionreinvindicatoria(forthelatterremedypresupposesownership).
(SeeGarchitorenav.Almeda,[C.A.]48O.G.3432;seealsoCruzadov.Bustos&Escaler,34
Phil.17).]
(2)LatinMaxim(ReDeliveryandOwnership)
Nonnudispactis,sedtraditionisdominiarerymtransferantur.(Asaconsequenceof
certaincontracts,itisnotagreementbuttraditionordeliverythattransfersownership).(10
Manresa339andFidelity&DepositCo.v.Wilson,8Phil.51).
(3)KindsofDelivery
Deliverymaybeeitheractualorconstructive.
.

(a)Actualdelivery(ortradition)wherephysically,thepropertychangeshands.Example:If
AsellsBafountainpen,thegivingbyAtoBofthefountainpenisactualtradition.

(b)Constructivedeliverythatwherethephysicaltransferisimplied.Thismaybedoneby:
1)traditiosimbolica(symbolicaltradition)(aswhenthekeysofabodegaaregiven)

112
CIVILCODEOFTHEPHILIPPINESArt.1164

2)traditiolongamanu(deliverybymereconsentorthepointingoutoftheobject)
(Etymologically,theextendingofthehand.)Example:pointingoutthecar,whichisthe
objectofthesale.

3)traditiobrevimanu(deliverybytheshorthand;thatkindofdeliverywherebya
possessorofathingnotasanowner,becomesthepossessorasowner)(Example:whena
tenantalreadyinpossessionbuysthehouseheisrenting).

4)traditioconstitutumpossessoriumtheoppositeofbrevimanu;thus,thedeliverywhereby
apossessorofathingasanowner,retainspossessionnolongerasanowner,butinsomeother
capacity(likeahouseowner,whosellsahouse,butremainsinpossessionastenantofthe
samehouse).

5)traditionbytheexecutionoflegalformsandsolemnities(liketheexecutionofapublic
instrumentsellingland).
[NOTE:Asalewhichissimulated,orevenagenuineone,wherethereisnodeliveryofthe
object,doesnottransferownership.(SeeCruzadov.Bustos&Escaler,34Phil.17).]
(4)DeliveryofIdealShare
Gatchalianv.Arlegui75SCRA234
Whenbyvirtueofacourtjudgment,apersonisorderedtodelivertoanotherthepossessionof
aproindivisooridealshareofproperty,ownedincommon,itisunderstoodthatwhatis
contemplatedissymbolicalorconstructivedelivery,notmaterialoractualdelivery.
(5)WhenDoestheObligationtoDeliverArise?
ANS.:Itdepends:
(a)Ifthereisnotermorcondition,thenfromtheperfectionofthecontract.
113
Art.1165CIVILCODEOFTHEPHILIPPINES

(b)Ifthereisatermoracondition,thenfromthemomentthetermarrivesorthecondition
happens.(See8Manresa4445).
Art.1244.Thedebtorofathingcannotcompelthecreditortoreceiveadifferentone,
althoughthelattermaybeofthesamevalueas,ormorevaluablethanthatwhichisdue.

Inobligationstodoornottodo,anactorforbearancecannotbesubstitutedbyanother
actorforbearanceagainsttheobligeeswill.
377
Art.1245CIVILCODEOFTHEPHILIPPINES

COMMENT:
(1)DebtorCannotCompelCreditortoAcceptaDifferentObject
Example:
AisobligedtogiveBaJaguarcar.NothavinganyJaguarcar,AwantsBtoacceptaRolls
Royce,amoreexpensivecar,butBrefusestoaccept.IsBjustifiedlegallyinrefusingto
accept?
ANS.:Yes.EveniftheRollsRoycebemorevaluablethantheJaguar,ifBdoesnotwantthe
RollsRoyce,hecannotbecompelledbyAtoacceptit.Thetermsofthecontractformthelaw
betweentheparties,andthesubjectmattercannotbechangedwithouttheconsentofthe
parties.
Question:IsArt.1244oftheCivilCodeapplicabletopersonalpositiveandnegative
obligations?
ANS.:Yes.Inobligationstodoornottodo,anactorforbearancecannotbesubstitutedby
anotheractorforbearanceagainsttheobligeeswill.Ofcourse,iftheobligeeconsents,thisis
allright.
(2)InstancesWhenArt.1244DoesNotApply
.

(a)incaseoffacultativeobligations;

(b)incasethereisanotheragreementresultingineither:1)dationinpayment(Art.1245,Civil
Code);2)ornovation(Art.1291,CivilCode);

(c)incaseofwaiverbythecreditor(expresslyorimpliedly).
Art.1246.Whentheobligationconsistsinthedeliveryofanindeterminateorgeneric
thing,whosequalityandcircumstanceshavenotbeenstated,thecreditorcannot
demandathingofsuperiorquality.Neithercanthedebtordeliverathingofinferior
quality.Thepurposeoftheobligationandothercircumstancesshallbetakeninto
consideration.
380

CIVILCODEOFTHEPHILIPPINESArt.1246

COMMENT:(1)ObligationtoGiveGenericThings
ReasonsfortheArticle:
ThisArticlegivesaprincipleofequityinthatitappliesjusticeinacasewherethereislackof
precisedeclarationintheobligation.Itisalwayshardtofindonethingthatisexactlysimilarto
another.Butinthiskindofobligation,thereisthequestionofrelativeappreciationinthatone
partyappreciatesthesamethingastheotherpartydoes.Ifthereisdisagreementbetweenthem,
thenthecourtstepsinanddeclareswhetherthecontracthasbeencompliedwithornot,
accordingtothecircumstances.(8Manresa280281).
(2)Waiver
Ifthecontractdoesnotspecifythequality
.

(a)thecreditorcannotdemandathingofsuperiorquality(butifhedesires,hemaydemand
andacceptoneofinferiorquality).

(b)thedebtorcannotdeliverathingofinferiorquality,butifhesodesires,hemaydeliverone
ofsuperiorquality(provideditisnotofadifferentkind).(SeeArt.1244,CivilCode).
(3)WhenContractIsVOID
NotethattheArticlespeaksofQUALITYandothercircumstances.WhentheKINDand
QUANTITY(asdistinguishedfromquality)cannotbedeterminedwithoutneedofanew
agreementoftheparties,thecontractisvoid.(Art.1349andArt.1409,No.6,CivilCode).
Theobjectofeverycontractmustbedeterminateastoitskind.Thefactthatthequantityis
notdeterminedshallnotbeanobstacletotheexistenceofthecontractprovideditispossible
todeterminethesamewithouttheneedofanewcontractbetweentheparties.
Art.1537.Thevendorisboundtodeliverthethingsoldanditsaccessionsandaccessories
intheconditioninwhichtheywereupontheperfectionofthecontract.
Allthefruitsshallpertaintothevendeefromthedayonwhenthecontractwasperfected.
COMMENT:

(1)Accessionsandaccessories
1

(a)Exampleofaccession:Fruits

(b)Exampleofaccessories:Inthesaleofacar,thejackisconsideredan
accessory.

(2)DutytoPreserveThisarticleimplicitlyreiteratesthedutyofthesellertoPRESERVE.
Naturally,afortuitouseventexcusestheseller.Butsinceafortuitouseventisneverpresumed,
thelossofthepropertybecauseofsucheventisnaturallytobeprovedbytheseller.(10
Manresa143).

(3)RighttotheFruitsAlthoughunderthesecondparagraphfruitsshallpertaintothebuyer
fromthedateofperfection,itisevidentthata
169
Art.1538CIVILCODEOFTHEPHILIPPINES

contrarystipulationmaybeagreedupon,oralaterdatemaybeset.(See10Manresa145).The
termfruitshereincludesnatural,industrialandcivilfruits.(BinalbaganEstatev.Gatuslao,
74Phil.128).
Art.440.Theownershipofpropertygivestherightbyaccessiontoeverythingwhichis
producedthereby,orwhichisincorporatedorattachedthereto,eithernaturallyorarti
ficially.
COMMENT:(1)AccessionDefined
Accessionistherightofapropertyownertoeverythingwhichis:
.

(a)producedthereby(accessiondiscreta);

(b)orwhichisincorporatedorattachedthereto,eithernaturallyorartificially(accession
continuaoraccessionnoninterrumpida),whichinturnisdividedinto:1)naturalaccession
(accessionnatural);
2)artificialaccession(accessionartificialoracces
sionindustrial).
[NOTE:Becauseofthewordartificially,itisunderstoodthatIMPROVEMENTSmadeon
thepropertyareincludedwithinthescopeofaccession.].
(2)OtherDefinitionsofAccession
(a)AccordingtoSanchezRoman(Vol.II,p.89)
Accessionistherightofanownerofathingtotheproductsofsaidthingaswellastowhatever
isinseparablyattachedtheretoasanaccessory.
201
Art.440

CIVILCODEOFTHEPHILIPPINES

(b)
(c)
AccordingtoStimsonsLawDictionary,RevisedEdition,p.58.
Accessionisthatbywhichpropertyisgiventoapersoninadditiontowhatsaidperson
alreadypossesses,saidadditionalpropertybeingtheresultofanaturalincrease,likeland,by
depositofariver;orhouses,whenbuiltononesownland;ortheyoungofanimals.
AccordingtoDelViso,Vol.II,p.33.
Accessionistherightwhichownershipofpropertygivesovereverythingwhichthesame
produces,orwhichisattachedorincorporatedthereto,naturallyorartificially.
(3)ClassificationofAccession
.

(a)AccessionDiscreta(TotheFruits)1)naturalfruits2)industrialfruits3)civilfruits

(b)AccessionContinua(AttachmentorIncorporation)
1)Withreferencetorealproperty
1

a)accessionindustrial(1)building(2)planting(3)sowing

b)accessionnatural
1

(1)alluvium

(2)avulsion

(3)changeofcourseofrivers

(4)formationofislands

2)Withrespecttopersonalproperty
a)adjunctionorconjunction
.

(1)inclusion(engraftment)

(2)soldadura(attachment)
202
CIVILCODEOFTHEPHILIPPINESArt.440

(3)tejido(weaving)

(4)pintura(painting)

(5)escritura(writing)

(b)mixture(confusionliquids;commixtionsolids)

(c)specification.
(4)IsAccessionaModeofAcquiringOwnership?
InBookIIIoftheCivilCode,whichdealswithdifferentmodesofacquiringownership,the
differentmodesareenumerated,namely:

(a)occupation

(b)intellectualcreation

(c)law

(d)donation

(e)succession

(f)tradition,asaconsequenceofcertaincontracts

(g)prescription
Itwillbenotedthataccessionisnotoneofthoselistedtherein.Itisthereforesafetoconclude
thataccessionisnotamodeofacquiringownership.Thereasonissimple:accession
presupposesapreviouslyexistingownershipbytheownerovertheprincipal.Thisisnot
necessarilysointheothermodesofacquiringownership.Therefore,fundamentallyandinthe
lastanalysis,accessionisarightimplicitlyincludedinownership,withoutwhichitwillhave
nobasisorexistence.Truly,itisoneoftheattributesorcharacteristicswhichwillmakeupthe
conceptofdominionorownership.(Manresa,6thEd.,Vol.3,p.116;180182).Wecanof
courserefertoacquisitionbyaccessionasacquisitionbyLAW(forthelawitselfgivesthe
right).
(5)ReasonBehindAccession
(a)foraccessiondiscreta(tothefruits)justice,pureandsimple,foronewhoownsathing
shouldjustlyenjoyitsfruits;
203
Art.441

CIVILCODEOFTHEPHILIPPINES

(b)
foraccessioncontinua(attachmentorincorporation)economicconvenienceisbetter
attainedinastateofsingleownershipthaninacoownership.Moreover,naturaljustice
demandsthattheowneroftheprincipalormoreimportantthingshouldalsoowntheaccessory.
(2Castan215216).
(6)RighttoAccessionGenerallyAutomatic
Ingeneral,therighttoaccessionisautomatic(ipsojure),requiringnoprioractonthepartof
theowneroftheprincipal.(Villanuevav.Claustro,23Phil.54).Agoodexampleisinthecase
oflandowneroverwhoselandarivernowflows.Heisipsofactotheowneroftheabandoned
riverbedinproportiontotheareahehaslost.(SeeArt.461).
Section1.RIGHTOFACCESSIONWITHRESPECTTOWHATISPRODUCED
BYPROPERTY(ACCESSIONDISCRETA)
Art.441.Totheownerbelongs:
.

(1)Thenaturalfruits;

(2)Theindustrialfruits;

(3)Thecivilfruits.
COMMENT:(1)AccessionDiscreta(RighttotheFruits)
ThisArticlereferstoaccessiondiscretawhichisdefinedastherighttotheownershipoffruits
producedbyourproperty.(SeeDelViso,Vol.II,p.33;3SanchezRoman89).
(2)SomeDecidedCasesandDoctrines
(a)Inanactiontorecoverparaphernalpropertyofthewife,theinterventionofthehusbandis
notneeded,andthereforethehusbandisnotanecessaryparty.Butifasidefromthe
paraphernalproperty,fruitstherefromaresought
204
CIVILCODEOFTHEPHILIPPINESArt.442

toberecovered,thehusbandmustjoinintheactionfirstbecauseheisacoownerofsaidfruits
(sincetheybelongtotheconjugalpartnership)andsecondlybecauseheistheadministratorof
theconjugalpartnership.(SeeQuizonv.Salud,12Phil.109).

(b)Inanactiontorecoverapersonspropertyunlawfullyinthepossessionofanother,
damagesmayinpartconsistofthevalueofthefruitsproduced.(SeeQuizonv.Salud,Ibid.).

(c)Atenantwhocontinuesonthelandafterexpirationoftheleasecontractandupondemand
tovacatecanbeconsideredapossessorinbadfaithandisresponsibleforthefruitsactually
producedaswellasthosethatcouldhavebeenproducedbyduediligence.Itwillbeobserved
thatliabilityforthefruitsisaconsequenceoftheusurpationandnotbecauseofaprovisionin
thecontractviolated.(SeeGuidov.Borja,12Phil.718).
(3)InstancesWhenOwnerofLandDoesNotOwntheFruits
UnderArt.441,theowneroflandownsthefruits.Inthefollowingcases,itisnottheowner
whoownsthefruits,butsomebodyelse:

(a)possessoringoodfaithoftheland(Heownsthefruitsalreadyreceived).(SeeArt.544,
par.1).

(b)usufructuary.(SeeArt.566).

(c)lesseegetsthefruitsoftheland(Ofcourse,theownergetsthecivilfruitsintheformof
rentals).(SeeArt.1654).

(d)Inthecontractofantichresis,theantichreticcreditorgetsthefruits,althoughofcourse,
saidfruitsshouldbeappliedfirst,totheinterest,ifanyisowing,andthentotheprincipal
amountoftheloan.(SeeArt.2132).
Art.442.Naturalfruitsarethespontaneousproductsofthesoil,andtheyoungandother
productsofanimals.
205
Art.442CIVILCODEOFTHEPHILIPPINES

Industrialfruitsarethoseproducedbylandsofanykindthroughcultivationorlabor.
Civilfruitsaretherentsofbuildings,thepriceofleasesoflandsandotherpropertyand
theamountofperpetualorlifeannuitiesorothersimilarincome.
COMMENT:(1)TechnicalMeaningofFruits
Thetermnatural,ndustrial,andcivilfruitsasdefinedbytheCodearehighly
technical,thereforewhentheyarefoundinafinaljudgment,therecanbenodoubtastotheir
meaning.Thus,ifafinaljudgmentspeaksonlyofnaturalandcivilfruits,itisunderstoodthat
industrialfruitsareNOTincluded.(Pamintuanv.Garcia,39Phil.746).
(2)NaturalFruits

Therearetwokindsofnaturalfruits:
.

(a)thespontaneousproductsofthesoil(thatis,humanlabordoesnotintervene).Examples
herbs,commongrass.(See3Manresa182).

(b)theyoungandotherproductsofanimals.(SeeArt.442,par.1).Exampleschicksand
chickeneggs.
(3)IndustrialFruits
Asdefined,theyarethoseproducedbylandsofanykindthrucultivationorlabor.(Art.442,
par.2).
Examples:

(a)lanzonesandbananas

(b)palayandcorn

(c)zacate(whenthisiscultivatedasfoodforhorses).(See3Manresa182183).
206
CIVILCODEOFTHEPHILIPPINESArt.442

(d)allkindsofcultivatedvegetables,sincethesearenodoubtalsoproducedbythelandthru
humanlabor(butnotcannedgoodsormanufacturedproducts).(3Manresa192193).
[NOTE:Arethecultivatedtreesinthemselvestobeconsideredfruits?
ANS.:Itissubmittedthatstrictly,theyarenotfruitsinthejuridicalsensefortheyarereally
immovablesaslongastheyarestillattachedtotheland,whichmaythemselvesproducefruits.
However,thereisnodoubtwemayconsidersaidtreesasfruitswhentheyareexpressly
cultivatedorexploitedtocarryonanindustry.(See3Manresa183).].
[NOTE:UnderAmericanlaw,distinctionhasbeenmadebetween:
.

a)perennialcrops(thosegrowingeachseasonwithoutneedofreplanting,likeorangesand
apples).

b)annualcrops(thosewhichhavetobeplantedeachyear,likecerealsandgrains).In
America,(a)isreferredtoasnaturalfruitswhile
(b)iscalledindustrialfruits.(SeeWalsh,TheLawofProperty,pp.1415).].
(4)YoungofAnimals

Whetherbroughtaboutbyscientificmeansornot,itwouldseemthattheyoungofanimals
shouldbeconsideredasnaturalfruits,sincethelawmakesnodistinction.
(5)MeaningofOtherProductsofAnimals
Thephrasenodoubtreferstosuchthingsaschickeneggs,orhorsemanure,ormilk,orwool.
(6)BARQuestion(Re:OffspringofAnimals)
Towhomdoestheoffspringofanimalsbelongwhenthemaleandfemalebelongtodifferent
owners?
207
Art.442CIVILCODEOFTHEPHILIPPINES

ANS.:ThispointisnotcoveredeitherbytheoldorthenewCivilCode.However,underthe
Partidas,theownerofthefemalewasconsideredalsotheowneroftheyoung,unlessthereisa
contrarycustomorspeculation.(2NavarroAmandi276).Moreover,inonecaseitwasheld
thatthelegalpresumption,intheabsenceofprooftothecontrary,isthatthecalf,aswellasits
motherbelongtotheownerofthelatter,bytherightofaccretion.(U.S.v.Caballero,25Phil.
356).(SeealsoSiariValleyEstatev.Lucasan,L7046,Aug.31,1955).Commentatorsopine
thattheruleofthePartidasmaybeappliedundertheCodesbecausesuchrulemerelycontinues
theownershipwhichtheownerofthefemalepossessed,whentheyoungwasstillinthewomb
ofthemother.Thisisalsoinaccordwiththemaximpratussequitorventrem(theoffspring
followsthedamormother).(See3SanchezRoman139).Thismaximisbasedontwogood
reasons:
.

(a)First,oftentimes,itisnotknownwhothemaleis.

(b)Second,duringthepregnancyofthefemale,itsownerisgreatlyburdenedbythe
consequentialexpensesandvirtualuselessnessoftheanimal,anditisonlyfairthatwhenthe
youngisborn,theownershouldgain,oratleastrecoverhisloss.(SeeBlackstoneComm.
390).
(7)SomeProblems

(a)AleasedafemaleanimalfromB.Duringtheperiodofthelease,theanimalproduceda
sibling.Whoownstheyoung(sibling)?ANS.:Aownstheyoung,forafterallacontractof
leaseisonerous.Itshouldbeobservedthatbyvirtueofthecontractoflease,thegeneralrule
thattheownerofthefemaleisalsotheowneroftheyoungmustgiveway.(See3CorpusJuris
22).

(b)Supposeintheprecedingproblem,Awasmerelygiventheanimalbywayofcommodatum
(gratuitousborrowing),wouldyouranswerbethesame?ANS.:No.Thistimetheownerofthe

femaleretainsown
ershipinviewofthegratuitouscontract.(SeeOrserv.Stoems,9Cow[N.Y.]687.).
208
CIVILCODEOFTHEPHILIPPINESArt.442

(8)CivilFruits
Asdefined,civilfruitsconsistof:
.

(a)rentofbuildings;

(b)priceofleases(rentals)oflandsandotherproperty(evenifpersonalproperty);

(c)theamountofperpetualorlifeannuitiesorothersimilarincome(butnotabonusgrantedas
arewardorasacompensationtoapersonwhomortgagedandthusriskshislandtosecure
anothersindebtedness).(SeeBachrachMotorCo.v.TalisaySilayMillingCo.,56Phil.117).
InthecaseofBachrachv.SeifertandElianoff,48O.G.569,itwasheldthatadividend,
whetherintheformofcashorstock,isincomeorfruits,becauseitisdeclaredoutofthe
profitsofacorporation,andnotoutofthecapital.(SeealsoOrozco,etal.v.Araneta,L3691,
Nov.21,1951).
(9)Cases
BachrachMotorCo.v.TalisaySilayMillingCo.56Phil.117
FACTS:Amillingcompany,inordertoobtainaloanfromabank,requestedoneofitssugar
planterstomortgagethelatterslandassecurity.Asareward,thecompanygavethemortgagor
abonus.Thebonuswaslaterclaimedby:

(a)acreditorofthemortgagor;

(b)thebank.(Thebankreasonedoutthatasmortgagee,itwasentitledtothefruitsandthat
thebonusshouldbeconsideredascivilfruits).
HELD:Thecreditorofthemortgagorisentitled.Inthefirstplace,amortgageeisnotentitled
tothefruitsofthelandmortgaged.Inthesecondplace,thebonusisnotcivilfruits.Itisnot
oneofthosemeantbythelawwhenitsaysothersimilarincomesincethisphraserefers
merelytothingsanalogousto
209
Art.442CIVILCODEOFTHEPHILIPPINES

rents,leases,andannuities.Assumingthatitisincome,stillitisnotincomeobtainedorderived

fromthelanditself,butincomeobtainedascompensationfortheriskassumedbytheowner.It
should,moreover,berememberedthatthebonuswasnotbaseduponthevalueorimportance
ofthelandbutuponthetotalvalueofthedebtsecured.Andthisissomethingdistinctfromand
independentofthepropertymortgaged.
Waitv.Williams5Phil.571
FACTS:Fromthe1stofacertainmonthtothe20th,Regidorwasentitledtothefruitsofa
certainproperty;andfromthe21sttothe30thofthesamemonth,theObrasPiaswasentitled.
Thepropertywasbeingrented.Whoshouldgettherentals?
HELD:Therentalsforthefirst20daysshouldbelongtoRegidor;thoseforthelast10days
shouldgototheObrasPias.Thisisbecausecivilfruitsaredeemedtoaccruedaily.(Art.544).
Velayov.RepublicL7915,July30,1955
Unpaidchargesfortheuseofgovernmentairportsandairnavigationfacilitiesarecivilfruits
thatbelongtothenationalgovernment,asowner,andnottotheCivilAeronautics
Administration,whichisonlyaninstrumentalityauthorizedtocollectthesame.
TheOverseasBankofManilav.CourtofAppealsL49353,June11,1981
Banksarenotrequiredtopayinterestondepositsfortheperiodduringwhichtheyarenot
allowedtooperatebytheCentralBank.Thisisdemandedbyfairness.However,intereststhat
hadaccruedpriortothesuspensionshouldbepaidbythebank,forafterall,ithasmadeuse
thenofthemoneydeposited.
Art.1497.Thethingsoldshallbeunderstoodasdelivered,whenitisplacedinthe
controlandpossessionofthevendee.
COMMENT:(1)RealorActualDelivery
Art.1497speaksofrealoractualdelivery(actualtradition).
Smith,Bell&Co.v.GimenezL17167,Jun.29,1963
FACTS:TheMunicipalTreasurerofPanique,Tarlac,thrutheBureauofSupplyorderedone
typewriterfromSmith,Bell&Co.Thetypewriterwasreceivedbytheguardofthemunicipal
Aug.30,1958.Tendayslater,themunicipalbuilding(aswellasthetypewriter)wastotally
burned.Shortlyafter,thesellersentabillcoveringthecostofthetypewriter.Themunicipal
counciladoptedaresolutionrequestingtheCompanytocondonethepaymentofthemachine,
ithavingbeenburnedafterdelivery.PetitionerCompanydeniedtherequest;thereafter,the
municipaltreasurersubmittedtotheprovincialtreasureravouchercoveringthepaymentofthe
typewritertothepetitioner.TheAuditorGeneraldisapprovedthesameonthegroundthat
therewasnodelivery,andthatthetypewriterwasneverpresentedforinspectionand

verificationaspreviouslyagreedupon.Issue:Wasthereadeliveryofthetypewriter?
HELD:Yes.Thiswastestifiedtobyboththeguard(whohadpersonallyreceiveditandthe
Mayorwhohadseenthe
109
Art.1497CIVILCODEOFTHEPHILIPPINES

deliveryandorderedthetakingofthemachinetohisoffice).Moreover,therequestfor
condonationofpaymentshowsbeyonddoubtactualdeliveryofthemachine.
(2)WhenOwnershipisNotTransferredDespiteDelivery
Thedeliveryofthesugartothewarehouseofthebuyertransfersownershipprovidedthatthe
salehadalreadybeenperfected(OcejoPerezandCo.v.Int.Bank,37Phil.631),butownership
isnottransferred,althoughtherehasbeenperfectionanddelivery,ifitwasintendedthatno
suchtransferofownershipwilltakeplaceuntilfullpaymentoftheprice.[SeeArt.1478,Civil
Code:Thepartiesmaystipulate(expresslyorimplied)thatownershipinthethingshallnot
passtothepurchaseruntilhehasfullypaidtheprice.](SeeMasiclat,etal.v.Centeno,L
8420,May31,1956).
Masiclat,etal.v.CentenoL8420,May31,1956
FACTS:Swastheownerof15sacksofriceofferedforsaleatherstoresituatedonastreet
nearthepublicmarket.AcertainpersonapproachedSandboughtitfromheratP26persack,
whichthebuyerpromisedtopayassoonashewouldreceivethepriceofhisadobestones
whichwerethenbeingunloadedfromatruckparkedattheoppositesideofthestreet.The
sellerbelievedthis,anduponrequestofthebuyer,thesellerorderedtheloadingofthericeon
thetruck,thesellercontinuallywatchingtheloading,waitingforthebuyertogivetoherthe
purchaseprice.Butthebuyerdidnotshowup.Sothesellerorderedthericeunloadedfromthe
truck.Shewasthereforesurprisedwhenthetruckcaretakerobjectedonthegroundthathe
himselfhadpurchasedthericefromanunnamedindividualatP26asack,andbeingtheowner
nowoftherice,hewasentitledtoitspossession.Nevertheless,thesellercontinuedtounload
therice.Thecaretakerofthetruckthensuedherforthecustodyoftherice.Issue:Whois
entitledtotherice?
HELD:Thesellerisentitledtothericeforthesimplereasonthatsheneverlostownership
thereof.Shecouldnothavetransferredtheownershiptotheunknownstranger
110
CIVILCODEOFTHEPHILIPPINESArt.1497

althoughtherewasdeliverybecauseshedidnotintendtotransfertheownershiptillafter
paymentoftheprice.Thisintentisevidentfromthefactthatthesellercontinuallywatchedher

riceanddemandeditsunloadingassoonastheunknownpurchaserwasmissing.
(NOTE:Inthesamecase,thecaretakerarguedthathehadabettertitletothericebyvirtueof
themaximthatwhereoneoftwopersonsmustsufferbyafraudadmittedbyathirdperson,he
whomadepossibletheinjuryandenabledthethirdpersontodowrongmustsuffertheloss.
TheSupremeCourt,however,heldthatthemaximcannotapplyforthesimplereasonthatthe
sellerherewasnotguiltyofanynegligenceatallinviewofhercontinuedwatchingofthe
rice.)
[NOTE:AnotherpointofthecaretakerwasthatArt.1505oftheCivilCodemustapply.Under
saidarticle,purchasesmadeatamarketarevalidevenifthesellerwasnotyettheowner,and
deliveryofthesamewouldtransferownershipbecauseofthedoctrineofostensibleownership,
namely,thatthemarketsellerappearstobetheowner,andifheisnot,thetrueowneris
negligentforhavingallowedhimtoappearastheowner.TheCourtheldthatsaidprovision
cannotapplybecausethesaledidnottakeplaceinthemarketbutonlyonthestreetnearit.]
(3)MeaningofTradition
Tradition,ordelivery,isamodeofacquiringownership,asaconsequenceofcertaincontracts
suchassale,byvirtueofwhich,actuallyorconstructively,theobjectisplacedinthecontrol
andpossessionofthevendee.
Albertv.UniversityPublishingCo.L9300,Sep.17,1958
FACTS:Theplaintiff,authorofatextinCriminalLaw,promisedtodeliverthemanuscriptof
hisbooktothedefendant,hispublisher,onorbeforeDec.31,1948.OnDec.16,1948,
plaintiffwrotealettertothecompanystatingthatthemanuscriptwasalreadyatitsdisposal,
andreadyforprinting
111
Art.1497CIVILCODEOFTHEPHILIPPINES

shouldthecompanydesiretopublishitthenextmonth;thathewashoweverkeepingthe
manuscriptinhisofficebecauseoffearofloss,destruction,orcopyingbyothers,andbecause
hedesiredtoaddnewdecisionsoftheSupremeCourtthatmightbepublishedfromtimeto
timebeforethemanuscriptwouldbeactuallysenttotheprinter.Healsostated,however,thatif
thecompanyinsistedonhavingthemanuscriptrightaway,itshouldlethimknowbecausehe
wouldthenactuallydeliveritimmediately.Issue:Wastherealreadydelivery?
HELD:Yes,fortheabovementionedfactsconstituteadeliveryofthemanuscript.Delivery
indeeddoesnotnecessarilymeanphysicalormaterialdelivery.Itmaybeconstructive,aswhen
itisplacedatthedisposaloftheother.
Roquev.LapuzL32811,Mar.31,1980

Thefactthataformaldeedofconveyancewasnotmadeindicatesverystronglythattheparties
didnotintendtoimmediatelytransfertheownership.Whattheyintendedwastotransfer
ownershiponlyafterfullpaymentoftheprice.
(4)KindsofDeliveryorTradition
.

(a)Actualorreal.(Art.1497,CivilCode).

(b)Legalorconstructive
1

1)legalformalities.(Art.1498,CivilCode).

2)symbolicaltraditionortraditiosimbolica(suchasthedeliveryofthekeyof
theplacewherethemovablesoldisbeingkept).(Art.1498,par.2,CivilCode).

3)traditiolongamanu(bymereconsentoragreement)ifthemovablesold
cannotyetbetransferredtothepossessionofthebuyeratthetimeofthesale.
(Art.1499,CivilCode).

4)traditiobrevimanu(ifthebuyerhadalreadythepossessionoftheobjecteven
beforethepurchase,aswhenthetenantofacarbuysthecar,thatis,his
possessionasanowner).(Art.1499,CivilCode).

112
CIVILCODEOFTHEPHILIPPINESArt.1497

5)traditioconstitutumpossessorium(oppositeoftraditiobrevimanu)possessionasowner
changed,forexample,topossessionasalessee.
Example:Isoldmycarbutcontinuedtopossessitasalesseeofthepurchaser.(Art.1500,
CivilCode).
[NOTE:InthecaseofTanBoonDickv.AparriFarmersCoop.MarketingAssn.,Inc.(L
14154,Jun.30,1960),theSupremeCourtheldthatintraditiobrevimanu(andbyimplication,
alsointraditioconstitutumpossessorium),thereisnotonlyconstructivedelivery,butalso
ACTUALDELIVERY.Insaidcase,thebuyerwasatthetimeofthesalealreadyalesseeof
theproperty.TheCourtalsoheldthatthepossessionofthebuyeraslesseewasconvertedinto
thatofanownerfromthedateoftheexecutionofthecontract.Theruleappliesevenifthe
pricehasnotbeenfullypaidintheabsenceofcourseofanystipulationthattheownershipof
thethingshallnotpasstothepurchaseruntilhehasfullypaidtheprice.(Art.1478,Civil
Code).]
(c)Quasitraditiondeliveryofrights,credits,orincorporealproperty,madeby:

1)placingtitlesofownershipinthehandsofalawyer;

2)orallowingthebuyertomakeuseoftherights.
(5)Case
(Art.1501,CivilCode).
Victoriasv.LeuenbergerandCAGR31189,Mar.31,1987
Wherethereisnoexpressprovisionthattitleshallnotpassuntilpaymentofthepriceandthe
thingsoldhasbeendelivered,titlepassesfromthemomentthethingsoldisplacedinthe
possessionandcontrolofthebuyer.Deliveryproducesitsnaturaleffectsinlaw,theprincipal
andmostimportantofwhichbeingtheconveyanceofownershipwithoutprejudicetotheright
ofthevendortoclaimpaymentoftheprice.
113
Art.1498CIVILCODEOFTHEPHILIPPINES

Art.1498.Whenthesaleismadethroughapublicinstrument,theexecutionthereof
shallbeequivalenttothedeliveryofthethingwhichistheobjectofthecontract,iffrom
thedeedthecontrarydoesnotappearorcannotclearlybeinferred.
Withregardtomovableproperty,itsdeliverymayalsobemadebythedeliveryofthe
keysoftheplaceordepositorywhereitisstoredorkept.
COMMENT:
(1)TwoKindsofConstructiveDelivery(ThruLegalFormalitiesandThruTraditio
Simbolica)
Art.1498treatsoftwokindsofconstructivedelivery:
.

(a)bylegalformalities(1stpar.)appliestorealandpersonalpropertysincethelawdoesnot
distinguish.(SeePuatuv.Mendoza,64Phil.457andBuencaminov.Viceo,13Phil.97).

(b)traditiosimbolica.(2ndpar.)PowerCommercial&IndustrialCorp.v.CA,Spouses
Reynaldo&AngelitoR.Quimbao,andPNBGR119745,Jun.20,199784SCAD67
Symbolicdelivery,asspeciesofconstructivedelivery,effectsthetransferofownershipthru
theexecutionofapublicdocument.Itsefficacycan,however,bepreventedifthevendordoes
notpossesscontroloverthethingsold,inwhichcasethislegalfictionmustyieldtoreality.
Thekeywordiscontrol,notpossessionoftheland.[NOTE:Constructivedeliveryrequires
threethingsbeforeownershipmaybetransmitted:
1)Thesellermusthavecontroloverthething;otherwisehowcanheputanotherincontrol?

(Addisonv.Felix,30Phil.404andMasallov.Cesar,39Phil.134).
114
CIVILCODEOFTHEPHILIPPINESArt.1498

2)Thebuyermustbeputundercontrol.(Addisonv.Felix,supraandMasallov.Cesar,
supra).

3)Theremustbetheintentiontodeliverthethingforpurposesofownership(not,forexample,
ofmerelyallowingtheinspectionorexaminationofthekeys,norforthepurposeofhaving
saidkeysrepaired).(10Manresa132).]
(2)RulesonConstructiveDelivery
(a)Ifasellerhasnoactualpossession,hecannottransferownershipbyconstructivedelivery.
(Masallov.Cesar,39Phil.134).Thereasonisthatineverykindofdelivery,thetransferee
shouldhavecontrol,butherecontrolcannotbehadsinceitisinthepossessionofanother.
(Addisonv.Felix,38Phil.404andVda.deSarmientov.Lesaca,L15385,Jun.30,1960).
CASES:
Addisonv.Felix38Phil.404
FACTS:SsoldtoBaparcelofland,2/3ofwhichwasinthepossessionofTwhoclaimedtobe
theownerofsaid2/3.ThedeedofsalebetweenSandBwasinapublicinstrument.BecauseB
couldnotgetcontrolofthe2/3ofthelandinthepossessionofT,Bsuedforthecancellationof
thesale.
HELD:Cancellationisproperbecausethepropertywasnotdelivered.Itistruethatordinarily,
theexecutionofapublicinstrumentisequivalenttothedeliveryofthethingwhichisthe
objectofthecontract,butinorderthatthisdeliverymayhavetheeffectoftradition,itis
essentialthatthevendorshallhavehadsuchcontroloverthethingsold,thatis,itcouldhave
beenpossiblethatatthemomentofthesaleitsmaterialdeliverycouldhavebeenmade.Itis
notenoughtoconferuponthepurchasertheownershipandtherightofpossession.Itisalso
imperativethatthethingsoldmustbe
115
Art.1498
CIVILCODEOFTHEPHILIPPINES

placedunderhiscontrol.Whenthereisnoimpedimentwhatevertopreventthethingsoldfrom
passingintotheactualpossessionofthepurchaserbythesolewillofthevendor,symbolic
deliverythroughtheexecutionofapublicinstrumentissufficient.Butif,notwithstandingthe

executionoftheinstrument,thepurchasercannothavetheenjoymentandmaterialtenancyof
thethingandmakeuseofithimselforthroughanotherinhisname,becausesuchtenancyand
enjoymentareopposedbytheinterpositionofanotherwill,thenfictionyieldstorealitythe
deliveryhasnotbeeneffected.(SeealsoGarchitorenav.Almeda,48O.G.No.8,3432and
Vda.deSarmientov.Lesaca,L15386,Jun.30,1960).
Roquev.LapuzL32811,Mar.31,1980
Ifinapurportedsale,adeedofconveyanceisnotexecuted,thiscanmeanthatthepartiesdid
notintendtoimmediatelytransfertheownershipoftherealpropertyinvolved.
Vda.deSarmientov.LesacaL15385,Jun.30,1960
FACTS:Abuyerinapublicinstrumentoftwopareelsoflandcouldnottakeactualphysical
possessionthereofbecauseacertainDelosoclaimedtobetherealifownerthereof.Underthe
termsofthedocument,thebuyerwasbeinggiventheactualpossessionofthelandssothathe
couldusetheminamannermostadvantageoustohim.Since,however,hecouldnottake
possession,heallegedthattherewasNOdelivery.Hence,heaskedforrescissionorresolution
ofthesale.
HELD:Consideringthefactsofthecase,therereallywasNOdeliveryand,therefore,hecan
eitheraskforresolutionwithareturntohimofthepurchasepricewithinterestanddamages)
orforspecificfulfillmentoftheobligation.Indeed,thelegalfictionthattheexecutionofa
publicdocumentisequivalenttodelivery,holdstrue
116
CIVILCODEOFTHEPHILIPPINESArt.1498

onlywhenthereisnoimpedimentthatmaypreventtheturningoveroftheproperty.
Asuncion,etal.v.Hon.PlanGR52359,Feb.24,1981
Inanactionforpartition,defendantsagreedtodelivertoplaintiff24hectaresofland.
Plaintiffsheirsthenexecutedleasecontractsinvolvingsaid24hectareswithcertainpersons,
notpartiesinthepartitioncase.Whenthelesseesfailedtopaytherent,theplaintiffsheirs
movedfortheissuanceofanaliaswritofexecutioninthepartitioncase,askingineffectfor
thedeliverytothemofthe24hectares.Themotioncannotbegranted,forbytheexecutionof
theleasecontracts,thejudgmentinthepartitioncasehadalreadybeenexecuted.Anewaction
isneededtooutthelessees,sincetheywerenotpartiesinthepartitioncase.
.

(b)Therecanbenoconstructivedeliverybymeansofapublicinstrumentifthereisa
stipulationtothateffect.Hence,theSupremeCourthasheldthatifthereisaclausetothe
effectthatthebuyerwilltakepossessionafterfourmonths,attheendof4monthsitcannot
besaidthatthereisanautomaticdelivery.Atsaidtime,theremuststillbeadelivery.Thesame

istrueinacaseofasalebyinstallment,whereitisstipulatedthattitleshouldnotbetransferred
tillafterthepaymentofthelastinstallment;orwherethevendorreservestherighttouseand
enjoytheirpropertyuntilthegatheringofthecropsstillgrowing.(Aviles,etal.v.Arcega,et
al.,44Phil.924,citing10Manresa,p.129).
.

(c)TheCivilCodedoesnotprovidethattheexecutionofthedeedisaconclusivepresumption
ofthedeliveryofpossession.Whatitsaysisthattheexecutionthereofshallbeequivalentto
deliverywhichmeansthatthedisputablepresumptionestablishedcanberebuttedbyclearand
convincingevidence,suchasevidenceofthefactthatthebuyerdidnotreallyobtainthe
materialpossessionofthebuilding.Hence,itmaybesaidthattheexecutionofthecontractis
onlypresumptivedelivery.(Montenegrov.RoxasdeGomez,58Phil.723).
117
Art.1498
CIVILCODEOFTHEPHILIPPINES

NorkisDistributors,Inc.v.CAGR91029,Feb.7,1990
ItistruethatArt.1498declaresthattheexecutionofapublicinstrumentisequivalenttothe
deliveryofthethingwhichistheobjectofthecontract,but,inorderthatthissymbolicdelivery
mayproducetheeffectoftradition,itisnecessarythatthevendorshallhavehadsuchcontrol
overthethingsoldthatatthemomentofthesale,itsmaterialdeliverycouldhavebeenmade.It
isnotenoughtoconferuponthepurchasertheownershipandtherightofpossession.Thething
soldmustbeplacedinhiscontrol.Whenthereisnoimpendimentwhatevertopreventthething
soldpassingintothetenancyofthepurchaserbythesolewillofthevendor,symbolicdelivery
throughtheexecutionofapublicinstrumentissufficient.
Butif,notwithstandingtheexecutionoftheinstrument,thepurchasercannothavethe
enjoymentandmaterialtenancyofthethingandmakeuseofithimselforthroughanotherin
hisname,becausesuchtenancyandenjoymentareopposedbytheinterpositionofanother
will,thenfictionyieldstorealitythedeliveryhasnotbeeneffected.
(3)EffectofNonPaymentofPrice
Executionofthedeedofsale,intheabsenceofanydefect,transfersdelivery,evenifthe
sellingprice,inwholeorinparthasnotyetbeenpaid,foritisnotpaymentthattransfers
ownership.(Puatuv.MendozaandDavid,64Phil.457).
Puatuv.MendozaandDavid64Phil.457
FACTS:PuatusoldaparceloflandtoMendozaforP39,000inapublicinstrument.The
amountofP14,200waspaid,leavingabalanceofP24,800.ThelandwasmortgagedtoPuatu
assecurityforthebalance.Puatusuedforthebalance.Mendozaclaimedthatthesalewasnot

absolutesincenotallthepurchasepricehasbeenpaidandthatthereforeheshouldberefunded
whathehadalreadypaid.
118
CIVILCODEOFTHEPHILIPPINESArt.1498

HELD:Thesalewasconsummatedandabsolute,andtheefendantmustnowpaythebalance.
Theplaintiffhasdoneallheisrequiredtodointhecontractofsale.Thelandhasalreadybeen
deliveredbytheexecutionofthepublicinstrument.Thebuyermustnowcomplywithhis
obligation.
(4)DeliveryThruExecutionofaQuedan
Ifthepartiesinasaleintendedthatthecoprasoldshouldbeplacedthenandthereunderthe
controlofthebuyerbytheissuanceofaquedan,deliveryiseffectedupontheexecutionofthe
quedan,andthesubsequentlossofthethingsoldshouldbebornebythepurchaser.(North
NegrosSugarCo.v.CiaGen.deTabacos,L9277,Mar.29,1957).
(5)Bar
AhassoldapianotoBbyprivateinstrumentforP500,000.Whohadownershipofthepianoat
themomentnextafterBhadpaidtheP500,000toA?Explainyouranswer.
ANS.:AtthemomentnextafterBhadpaidtheP500,000toA,ownershipoverthepianostill
residedinA,theexecutionoftheprivateinstrumentnotbeingamodeoftransferringownership
(unlessofcoursetherehadbeenmutualagreementlongamanuonthetransferof
ownership).Paymentofthepricewithouttraditionordeliveryisnotamodeofacquiring
ownershipoverthepiano.(SeeArts.712,1497,1498,CivilCode).
(6)Bar
ApersonboughtinIloiloatractorforacertainprice.Itwasagreedthatdeliveryofthetractor
shouldbemadewithinacertaintimeatthewarehouseofthepurchaserinManila,andthe
balanceofthepriceshouldbepaidatthemomentofdelivery.WhileenroutetoManila,the
tractorwasdeliveredbythevendortoathirdpersontosecurealoanobtainedbyhimforhis
personalconvenience.Doyouthinkthatthepurchasercanrecoverthetractorfromthethird
person?Why?
ANS.:Theanswerisinthenegativebecausenodeliverywasevermadetothebuyer,hencehe
neverbecametheowner
119
Art.1499CIVILCODEOFTHEPHILIPPINES

ofthetractor.(Art.1496,CivilCode).Notbeingtheownerhehadnorealrightoverthe
property,sohecannotbringanactiontorecoveritfromanindividualinlawfulpossessionof
thetractor.(SeeArt.1164,CivilCode;Seealso1Manresa125etseq.).
(7)Case
ZenaidaM.Santosv.CalixtoSantos,etal.GR133895,Oct.2,2001
FACTS:PetitionerinhermemoranduminvokesArt.1477oftheCivilCodewhichprovides
thatownershipofthethingsoldistransferredtothevendeeuponitsactualorconstructive
delivery.Art.1498,inturn,providesthatwhenthesaleismadethruapublicinstrument,its
executionisequivalenttothedeliveryofthethingsubjectofthecontract.Petitioneraversthat
applyingsaidprovisionstothecase,Salvadorbecametheownerofthesubjectpropertyby
virtueofthetwodeedsofsaleexecutedinhisfavor.Issue:Isasalethruapublicinstrument
tantamounttodeliveryofthethingsold?
HELD:NowhereintheCivilCode,doesitprovidethatexecutionofadeedofsaleisa
conclusivepresumptionofdeliveryofpossession.TheCodemerelysaysthattheexecution
shallbeequivalenttodelivery.Thepresumptioncanberebuttedbyclearandconvincing
evidence.Presumptivedelivercanbenegatedbyfailureofthevendeetotakeactualpossession
ofthelandsold.
Art.1499.Thedeliveryofmovablepropertymaylikewisebemadebythemereconsent
oragreementofthecontractingparties,ifthethingsoldcannotbetransferredtothe
possessionofthevendeeatthetimeofthesale,orifthelatteralreadyhaditinhis
possessionforanyotherreason.
COMMENT:TraditioLongaManuandTraditioBreviManu(a)Thefirstpartdealswith
traditiolongamanu.
120
CIVILCODEOFTHEPHILIPPINESArts.15001501

(b)Thesecondpartdealswithtraditiobrevimanu.(SeealsoCommentNo.4underArt.1497.)
(NoticethatArt.1499speaksofmovableproperty.)Art.1500.Theremayalsobe
traditionconstitutumpos
sessorium.
COMMENT:
TraditioConstitutumPossessorium

(a)Formeaningoftraditioconstitutumpossessorium,seecommentNo.4underArt.1497,
supra.

(b)Thebasishereisconsent.

(c)Whereasellercontinuestooccupythelandastenant,thepossession,byfictionoflaw,is
deemedtobeconstitutedinthebuyer.(Amuov.Teves,60O.G.5799).
Art.1501.Withrespecttoincorporealproperty,theprovisionsofthefirstparagraphof
Article1498shallgovern.Inanyothercasewhereinsaidprovisionsarenotapplicable,
theplacingofthetitlesofownershipinthepossessionofthevendeeortheusebythe
vendeeofhisrights,withthevendorsconsent,shallbeunderstoodasadelivery.
COMMENT:DeliveryofIncorporealProperty
Incorporealpropertiesmaybedelivered:

(a)byconstructivetraditionexecutionofpublicinstrument.

(b)byquasitraditionplacingoftitlesofownershipinthepossessionofthebuyer,orthe
usebythebuyerofhisrights,withthesellersconsent.[NOTE:Thedeliveryoflandtitle
deedsisequivalenttoadeliveryofthepropertyitself.(Guerrerov.Miguel,10Phil.52and
Marellav.ReyesandPaterno,12Phil.
121
Art.1501
CIVILCODEOFTHEPHILIPPINES1).Soistheuseofthevendorsrightwiththevendors

consent.(Tablantev.Aquino,28Phil.35).]
NorthNegrosSugarCo.v.Co.GeneraldeTabacosL9277,Mar.29,1957
FACTS:TheCompaniaGeneraldeTabacos(Tabacalera)soldonOct.14,1941totheLuzon
IndustrialCorporation600tonsofcopratobedeliveredatthebodegaofthebuyerinJan.or
Feb.1942.Threedayslater,thepartiesagreedthatthebuyerwouldpay,anddidpayP50,000
onaccount,andthatthesellerwouldissue,anddidissue,aquedanforthecopraagreedtobe
sold.Thequedanissuedanddeliveredtothebuyerstatedthatthesellerplacedthe500tonsof
copraatthedispositionofthebuyerinthebodegaofthesellerinCebufordeliveryJan.orFeb.
1942.Afterthequedanhadbeendelivered,the500tonsofcoprawereactuallysegregatedand
expresslyidentifiedwithintheCebubodega.However,inanotherdocumentthesellerreserved
theoptiontogetthecoprafromitsotherbodegas,saidoptiontobeexercisedinJan.orFeb.
1942,butthisoption,wasneverexercised.ThecopraremainedintheCebubodegauntilitwas
commanderedbytheJapaneseforcesinSept.1942.In1948,thebuyerbroughtanactionto

recovertheP50,000allegingthatthesellerhadneverdeliveredthecopra.Itclaimedthatthe
salewasnotconsummatedbecausethecoprahadnotbeenplacedinitsownbodegasasagreed
uponinthecontractofOct.14,1941.Issue:Canthemoneyberecovered?Wastheredelivery?
HELD:Themoneycannotberecoveredanymore.Deliverywaseffectedupontheexecutionof
thequedanbecausethepartiestherebyintendedthatthecoprasoldwasthenandthereplaced
underthecontrolofthebuyer.Whileitistruethatintheoriginalcontractthecoprawastobe
deliveredatthebodegaofthebuyer,stillthisstipulationastotheplaceofdeliverywas
modifiedinthesensethatthedeliverywaseffectedthenandtherebytheissuanceofthe
quedanplacingthecopraintheCebubodegaatthebuyersdisposition.Asaresult,asowner
122
CIVILCODEOFTHEPHILIPPINESArt.1502

ofthecoprathebuyerbearsthelossofthesame,sincethelossoccurredbyreasonofforce
majeurewithoutthefaultoftheseller.(SeeArt.1497,CivilCode;Lizaresv.Hernaez&
Alunan,40Phil.98andObejerav.IgaSy,43O.G.1211).Withreferencetotheapparently
contradictingprovisionofthequedanregardingtheoptionofgettingthecoprafromtheother
bodegasdeliverywasinfactmadeonOct.18,1941,upontheissuanceanddeliveryofthe
quedan,butsubjecttotherightofthesellertomakethesubstitution.Sincenosubstitutionwas
made,itisclearthattheoriginaldeliverystands.(SeealsoArt.1452,CivilCodeandArt.331,
CodeofCommerce).

Art.1165.Whenwhatistobedeliveredisadeterminatething,thecreditor,inadditionto
therightgrantedhimbyArticle1170,maycompelthedebtortomakethedelivery.
Ifthethingisindeterminateorgeneric,hemayaskthattheobligationbecompliedwith
attheexpenseofthedebtor.
Iftheobligordelays,orhaspromisedtodeliverthesamethingtotwoormorepersons
whodonothavethesameinterest,heshallberesponsibleforfortuitouseventuntilhe
haseffectedthedelivery.
COMMENT:
(1)ClassificationofObligationfromtheViewpointofSubjectMatter
Fromtheviewpointofthesubjectmatter(orobject)oftheobligation,obligationsaredivided
into:

(a)realobligations(togive):
1

1)togiveaspecificthing(setapartfromaclass);

2)togiveagenericorindeterminatething(oneofaclass).

(b)personalobligations(todoornottodo).
(2)SpecificorDeterminateThings
Athingissaidtobespecificordeterminatewhenitiscapableofparticulardesignation.
Examples:

(a)thiscar

(b)thecarownedbyAonSept.12,2005

(c)thecarwithplatenumber1814(2005)
114
CIVILCODEOFTHEPHILIPPINESArt.1165(d)thisparticularpictureofMauiinmynotebook

(3)GenericorIndeterminateThings
Athingisgenericorindeterminatewhenitrefersonlytoaclass,toagenus,andcannotbe
pointedoutwithparticularity.
Examples:
.

(a)acar

(b)a2005BMWautomobile

(c)thesumofP5million

(d)akiloofsugar
(4)RemediesoftheCreditorWhentheDebtorFailstoComplyWithHisObligation

(a)demandspecificperformance(orcompliance)oftheobligation.(Thisistruewhetherthe
obligationbegenericorspecific.)

(b)demandrescissionorcancellation(insomecases).

(c)demanddamageseitherwithorwithouteitherofthefirsttwo,(a)or(b).(NOTE:IfIam
entitledto10kilosofsugarfromA,IcandemandthatAobtainthesugarandgiveme10kilos

thereof.Thisistrueeveniftheobligationherebegeneric.Acannotinsistonjustpayingme
damagesorthemonetaryvalueofthesugar.Upontheotherhand,ifIdesireto,Icanjustbuy
10kilosofsugaranywhereandchargetheexpensetoA.).Uyv.Puzon79SCRA598Ifa
partnerinaconstructionenterprisefailstofulfillhis
commitmentstothepartnership,heisrequiredtoindemnifyhiscopartnerforthelatters
losses,suchasthemoneyinvestedorspentbythelatter.
115
Art.1165CIVILCODEOFTHEPHILIPPINES

(5)Case(ReImprisonmentBecauseofaDebt)
RufoQuemuelv.CourtofAppealsL22794,Jan.16,1968
FACTS:RufoQuemuelwasconvictedbytheCourtofFirstInstance(nowRegionalTrial
Court)ofRizalofthecrimeoflibel.TheconvictionwasaffirmedbytheCourtofAppeals.On
appealtotheSupremeCourt,healleged,amongotherthings:
.

(a)Thattherewasnoproofthatdamageshadbeensustainedbytheoffendedparty;and

(b)Thatsubsidiaryimprisonmentfornonpaymentoftheindemnityconstitutesimprisonment
fornonpaymentofdebtandisthereforeunconstitutional.HELD:

(a)Asregardstheallegedabsenceofproofthattheoffendedpartyhassufferedmental
anguish,lossofsleep,orcouldnotlookathisneighborstraightintheeye,sufficeittostress
thatbyitsverynature,libelcausesdishonor,disreputeanddiscredit;thattheinjurytothe
reputationoftheinjuredpartyisanaturalandprobableconsequenceofthedefamatorywords
inlibelcases;thatwherethearticleislibelouspersethelawimpliesdamages;andthat
thecomplainantinlibelcasesisnotrequiredtointroduceevidenceofactualdamages,at
least,whentheamountoftheawardismoreorlessnominal.

(b)Thecivilliabilityarisingfromlibelisnotadebt,withinthepurviewoftheconstitutional
provisionagainstimprisonmentfornonpaymentofadebt.Insofarassaidinjunctionis
concerned,debtmeansanobligationtopayasumofmoneyarisingfromcontractexpress
orimplied.Inadditiontobeingpartofthepenalty,thecivilliabilityinthepresentcasearises
fromatortorcrime,andhence,fromlaw.Asaconsequence,thesubsidiaryimprisonmentfor
nonpaymentofsaidliabilitydoesnotviolatetheconstitutionalinjunction.[NOTE:Undera
comparativelynewRepublicAct,courtscannolongerimposesubsidiaryimprisonmentin
116
CIVILCODEOFTHEPHILIPPINESArt.1165

caseofcivilliabilityarisingfromacrimepreciselyonthetheorythatsaidsubsidiary

imprisonmentwouldseemtoviolatetheconstitutionalinjunction.However,iffines(notcivil
liabilities)areunpaidtotheState(notethatcivilliabilitiesgotooffendedprivateparties),
subsidiaryimprisonmentcanbeimposed(providedthedecisionofthecourtimposessuch
subsidiaryimprisonment).]
(6)EffectofFortuitousEvents
Anotherimportantdifferencebetweenagenericandaspecificobligationisthat,aspecific
obligation,thatis,anobligationtodeliveraspecificthing,is,asarule,extinguishedbya
fortuitouseventoractofGod.Upontheotherhand,genericobligationsareneverextinguished
byfortuitousevents.
Examples:
.

(a)AisobligedtogiveBthiscar.Beforedelivery,anearthquakedestroyscompletelythecar.
Theobligationtodeliverisextinguished.

(b)AisobligedtogiveBabook.Sincethisisagenericthing,evenifoneparticularbookis
lost,otherbooksmaytakeitsplace.Hence,theobligationisnotextinguished(genusnunquam
perit).
(7)TwoInstancesWhereaFortuitousEventDoesNotExempt
The3rdparagraphofArt.1165givestwoinstanceswhenafortuitouseventdoesnotexcuse
compliance:

(a)iftheobligordelays(Thisisreallydefaultormora.)

(b)iftheobligorisguiltyofBADFAITH(forhavingpromisedtodeliverthesamethingto
twoormorepersonswhodonothavethesameinterestaswhenoneisnottheagentmerely
oftheother)
(8)OrdinaryDelayDistinguishedfromDefault
Ordinarydelayisdifferentfromlegaldelay(default).Thefirstismerelynonperformanceat
thestipulatedtime;default
117
Art.1165CIVILCODEOFTHEPHILIPPINES

isthatdelaywhichamountstoavirtualnonfulfillmentoftheobligation.(Asarule,toputa
debtorindefault,theremustbeademandforfulfillment,thedemandbeingeitherjudicialor
extrajudicial.)
(9)Examples

(a)AisobligedtogiveBhisJaguarcaronDec.7,2005.Ifonsaidday,Adoesnotdeliver,he
isinordinarydelay(notdefault).IfonDec.8,2005,anearthquakedestroystheJaguarcar,A
isnotliablebecausetheobligationisextinguished.

(b)If,however,onDec.8,demandwasmadefordelivery,Awouldbeinlegaldelay(default)
andiflater,thecarisdestroyedbyafortuitousevent,hewouldstillbeliable(inthatthe
obligationtodeliverthelostspecificthingisconvertedintoamonetaryclaimfordamages).
(SeeArt.1165,CivilCode).However,ifthecarwouldhavebeendestroyedatanyrateevenif
nodemandhadbeenmade,theamountofdamagewouldbereduced.(Art.2215,No.4,Civil
Code).
(10)SomeDecidedCasesandCourtRulings
Thephrase100kilosof1stclasssugarraisedinmyplantationdealswithagenericthing
becauseoflackofphysicalsegregation.(YuTekv.Gonzales,29Phil.284).
YuTekv.Gonzales29Phil.384
FACTS:Aobligatedhimselftosellforadefinitepriceacertainspecifiedquantityofsugarofa
givenquality,withoutdesignatingaparticularlot.Issue:Incasethesugarislostbyafortuitous
event,whobearsthelosspriortodelivery,thesellerorthebuyer?
HELD:Inthiscase,thesellerbearsthelossbecausewhatwastobedeliveredwasnota
specificthing,butagenericthing.Andgenusneverperishes.Incidentally,thesaleherecannot
besaidtohavebeenalreadyperfectedbecauseofthelackofphysicalsegregationfromthe
restofthesugar.
118
CIVILCODEOFTHEPHILIPPINESArt.1166

Romanv.Grimalt6Phil.96
FACTS:AwantedtobuyaparticularshipfromBonconditionthatBwouldprovebypapers
thathe(B)wastherealowneroftheship.Subsequently,theshipwaslostbyafortuitousevent
althoughthepapershadnotyetbeenproduced.Issue:IsArequiredtopay?
HELD:Aisnotlegallyboundtopaybecausetherewasnoperfectedsaleyet,sincethe
condition,namely,theproofofownershiphad,atthattimeofloss,notyetbeenfulfilled.Awas
notabuyer;hewasonlyawouldbebuyer.
[NOTE:HadAalreadyboughttheship(hadtheproofofownershipbeenpresentedearlier)
hewouldhavebeencompelledtopaythepurchasepriceevenifatthetimeofloss,thething
hadnotyetbeendeliveredtohim,sinceafterall,thesalewouldhavebeenalreadyperfected.]
GutierrezRepidev.Alzelius39Phil.190

FACTS:AboughtpropertyfromBoninstallment.Whenthefirstinstallmentfelldue,Adidnot
pay.Hisdefensewasthathedidnothavemoney,andhethereforepleadedimpossibilityof
performance.Issue:IsAexcusedfromhisobligation?
HELD:No.Merepecuniaryinabilitytopaydoesnotdischargeanobligationtopay,nordoes
itconstituteanydefensetoadecreeforspecificperformance.Thestabilityofcommercial
transactionsrequiresthattherightsofthesellerbeprotectedjustaseffectivelyastherightsof
thebuyer.
Art.1166.Theobligationtogiveadeterminatethingincludesthatofdeliveringallits
accessionsandaccessories,eventhoughtheymaynothavebeenmentioned.
COMMENT:(1)WhattheObligationtoGiveaDeterminateThingIncludes
Example:
IfIamobligedtodeliveraparticularcar,Imustalsogivetheaccessories(likethejack).IfI
amobligedtodeliver
119
Art.1167CIVILCODEOFTHEPHILIPPINES

apieceofland,Imustgivealsotheaccessions(likeabuildingconstructedthereon).(Thisis
trueevenifnomentionofthemwasmadeinthecontract.)
.

(2)Accessoriesthosejoinedtoorincludedwiththeprincipalforthelattersbetteruse,
perfection,orenjoyment.(Examples:thekeystoahouse,thedishesinarestaurant.)

(3)Accessionsadditionstoorimprovementsuponathing.Theseincludealluvium(soil
graduallydepositedbythecurrentofariveronariverbank)andwhateverisbuilt,planted,or
sownonapersonsparcelofland.(NOTE:Evenifthewindowsofabuildinghavebeentem
porarilyremoved,theyshouldstillbeincluded.)

(4)EffectofStipulationOfcourse,ifthereisastipulationtosaideffect,accessionsand
accessoriesdonothavetobeincluded.

Art.1167.Ifapersonobligedtodosomethingfailstodo
it,thesameshallbeexecutedathiscost.
Thissameruleshallbeobservedifhedoesitincontraventionofthetenorofthe
obligation.Furthermore,itmaybedecreedthatwhathasbeenpoorlydonebeundone.

COMMENT:
.

(1)PositivePersonalObligationsThefirstsentenceoftheArticledealswithapositiveper
sonalobligation(TODO).

(2)RemediesofCreditorifDebtorFailstoDo
(a)Tohavetheobligationperformed(byhimselforbyanother)atdebtorsexpense(onlyif
anothercandotheperformance).(SeeChavezv.Gonzales,L27454,Apr.30,1970).
(b)Alsotoobtaindamages.(Art.1170,CivilCode).(Damagesalonecannotsubstitutefor
performanceifownerscan
120
CIVILCODEOFTHEPHILIPPINESArt.1167

doit;ifpurelypersonalorspecialasapaintingtobedonebyareputedartistonly
damagesmaybeasked,unlesssubstitutionispermitted.)
(NOTE:Specificperformanceisnotaremedyinpersonalobligations;otherwise,thismay
amounttoinvoluntaryservitude,whichasaruleisprohibitedunderourConstitution.)
[NOTE:Apartytoanagreementtomarrywhobacksoutcannotbeheldliableforthecrimeof
slanderbydeedforthenthatwouldbeanindirectwayofcompellingsaidpartytogointoa
marriagewithouthisorherfreeconsent,andthiswouldcontravenetheprincipleinlawthat
whatcannotbedonedirectlyshouldNOTbedoneindirectly;andsaidpartythereforehasthe
righttoavoidforhimselforherselftheevilofgoingthrualovelessmarriage,pursuanttoArt.
11,par.4oftheRevisedPenalCode.(Peoplev.Hernandez,etal.,55O.G.,p.8456,CA).]
Chavezv.GonzalesL27454,Apr.30,1970
FACTS:Atypewriterownerdeliveredthesametoarepairmanforrepairsagreeduponorally.
Despiterepeateddemands,noworkwasdonethereon.Eventuallytherepairmanreturnedthe
machine,unrepairedandworse,severalpartsweremissing,thusthedescriptioncannibalized
andunrepaired.Theownerwasthenconstrainedtohavethetypewriterrepairedinanother
shop.Ownernowclaimsdamagesfromthefirstrepairman(forthecostoftherepairsandthe
costofthemissingparts).Defendantrepairman,however,allegesthatownershouldhavefirst
filedapetitionforthecourttofixtheperiodwithinwhichthejobofrepairingwastobe
finished.
ISSUES:
.

(a)Canthedefendantbeheldliablefordamages?

(b)Howaboutthefailureoftheownertofirstaskthecourtforthefixingoftheperiod?

121
Art.1168
CIVILCODEOFTHEPHILIPPINES

(a)
(b)
HELD:
Yes,thedefendantcanbeheldfordamagesandthiswouldincludethecostoflaborandneeded
materials,aswellasthevalueofthemissingparts.AccordingtoArt.1167Ifaperson
obligedtodosomethingfailstodoit,thesameshallbeexecutedathiscost.Thesamerule
shallbeobservedifhedoesitincontraventionofthetenoroftheobligation.
Thefailureoftheownerofthecomputernotebooktofirstaskthecourtforafixingofthe
periodwithinwhichtherepairsweretobedoneisofnosignificance.Inviewofhisreturning
ofthemachine,thetimeforcompliancemaybedeemedtohavealreadyexpired.Thereis,
therefore,nomoreperiodtobefixed,therealreadybeingabreachofcontractbynonperform
ance.Saidnonperformancemaybesaidtohavebeenimpliedlyadmittedwhenthenotebook
wasreturnedunrepairedandwithsomeofitsessentialpartsmissing.
(3)WhenaThingMayBeOrderedUndone
.

(a)ifmadepoorly(Art.1167)(Hereperformancebyanotheranddamagesmaybedemanded).

(b)iftheobligationisanegativeone(providedtheundoingispossible).
Art.1168.Whentheobligationconsistsinnotdoing,andtheobligordoeswhathasbeen
forbiddenhim,itshallalsobeundoneathisexpense.
COMMENT:NegativePersonalObligations

(a)ThisArticlereferstoanegativepersonalobligation.

(b)Asarule,theremedyistheundoingoftheprohibitedthingplusdamages.(SeeArt.1170,
CivilCode).
122
CIVILCODEOFTHEPHILIPPINESArt.1169

Art.1169.Thoseobligedtodeliverortodosomethingincurindelayfromthetimethe
obligeejudiciallyorextrajudiciallydemandsfromthemthefulfillmentoftheirobliga

tion.
However,thedemandbythecreditorshallnotbenecessaryinorderthatdelaymay
exist:
(1)Whentheobligationorthelawexpresslysodeclares;or
(2)Whenfromthenatureandthecircumstancesoftheobligationitappearsthatthe
designationofthetimewhenthethingistobedeliveredortheserviceistoberendered
wasacontrollingmotivefortheestablishmentofthecontract;or
(3)Whendemandwouldbeuseless,aswhentheobligorhasrendereditbeyondhispower
toperform.
Inreciprocalobligations,neitherpartyincursindelayiftheotherdoesnotcomplyoris
notreadytocomplyinapropermannerwithwhatisincumbentuponhim.Fromthe
momentoneofthepartiesfulfillshisobligation,delaybytheotherbegins.
COMMENT:(1)DefaultorMora
AlthoughArt.1169usesthewordsindelay,theseshouldbetranslatedtomeandefault
(MORA).
(2)NecessityinGeneralofDemand
Toputadebtorindefault,asarule,DEMANDisneeded.Thedemandmaybejudicial,as
whenacomplaintforspecificperformanceisfiled;orextrajudicial,withoutcourtproceed
ings.
(3)WhenDemandIsNotNeededtoPutDebtorinDefault
(a)Whenthelawsoprovides.(Example:Taxesshouldbepaidwithinadefiniteperiod,
otherwisepenaltiesareimposedwithoutneedofdemandforpayment.)
123
Art.1169(b)
CIVILCODEOFTHEPHILIPPINESWhentheobligationexpresslysoprovides.

[NOTE:Themerefixingoftheperiodisnotenough;theremustbeaprovisionthatifpayment
isnotmadewhendue,defaultorliabilityfordamagesorinterestsautomaticallyarises.(SeeDe
laRosav.BankofP.I.,51Phil.926).]
(NOTE:ThecontraryrulinginSiulongandCo.v.Ylagan,43Phil.393,iswrong.)

Whentimeisoftheessenceofthecontract(orwhenthefixingofthetimewasthecontrolling
motivefortheestablishmentofthecontract).
Examples:Themakingofaweddingdress,iftheweddingisscheduledatthetimethedressis
due;agriculturalcontractswhereimplementsareneededataparticulartime;thesellingofland
withpaymentatspecifiedtime,sothatthesellercouldpayoffcertaindebtsthatweredueon
saiddate(Abellav.Francisco,55Phil.447);moneyneededtofinancemininginstallationsif
saidinstallationshadtobemadeonacertaindate.(Hanlonv.Hausserman,40Phil.796).
[NOTE:Itisnotessentialforthecontracttocategoricallystatethattimeisoftheessence;the
intentissufficientaslongasthisisimplied.(Hanlonv.Hausserman,Supra.)]
Whendemandwouldbeuseless,aswhentheobligorhasrendereditbeyondhispowerto
perform.(Examples:Whenbeforethematurity,thesellerhasdisposedofitinfavorofanother,
orhasdestroyedthesubjectmatter,orishiding.)
Whentheobligorhasexpresslyacknowledgedthathereallyisindefault(Butitshouldbe
notedthathismereaskingforextensionoftimeisnotanexpressacknowledgmentofthe
existenceofdefaultonhispart).(See3Salvat64).
(c)
(d)
(e)
(4)DifferentKindsofMora
(a)morasolvendi(defaultonthepartofthedebtor)124
CIVILCODEOFTHEPHILIPPINESArt.1169

1)morasolvendiexre(debtorsdefaultinrealobligations)

2)morasolvendiexpersona(debtorsdefaultinpersonalobligations)

(b)moraaccipiendi(defaultonthepartofthecreditor)

(c)compensatiomorae(wheninareciprocalobligationbothpartiesareindefault;hereitis
asifneitherisindefault).
(5)MoraSolvendi

(a)Thereisnomorasolvendiinnegativeobligations(onecannotbelateinnotdoingor
giving).

(b)Thereisnomorainnaturalobligations.

(c)Requisitesformorasolvendi:
1)Theobligationmustbedue,enforceable,andalreadyliquidatedordeterminateinamount.
(TS,Mar.15,1926).
2)Theremustbenonperformance.
3)Theremustbeademand,unlessthedemandisnotrequired(asalreadydiscussed).(When
demandisneeded,proofofitmustbeshownbythecreditor).(8Manresa61).[NOTE:Amere
reminder,likeThisistoremindyouthatyournextinstallmentfallsdueonJan.7,2005,is
notademandbecauseforallthatweknow,latenessmaystillbetoleratedbythecreditor.(2
Castan528).]
4)Thedemandmustbefortheobligationthatisdue(andnotforanotherobligation,norone
withabiggeramount,exceptincertaininstances,consideringallthecircumstances).(SeeTS,
Jan.1910).

(d)EffectsofMoraSolvendi
1)Ifthedebtorisindefault,hemaybeliableforinterest
ordamages.125
Art.1169
CIVILCODEOFTHEPHILIPPINES

(e)
Inapurchasebyinstallments,thecontractmayprovideforanaccelerationclause(aclause
whichwouldmakeallinstallmentsdue,upondefaultinoneinstallment).Defaultinthe
paymentofoneinstallmentdoesnotmeandefaultinthewholeamount.Ifthereisan
accelerationclause,allthathappenswillbethatthewholeamountbecomesdue.Anddemand
isstillneededtoputthedebtorindefault.(SeeQueblarv.Garduno&Martinez,62Phil.897).
2)
3)
Hemayalsohavetobeartheriskofloss.
(Inbothcases,itis,however,essentialthathisbeingindefaultisattributabletohisownfault.)
Heisliableevenforafortuitousevent(Art.1165,CivilCode),althoughdamagesheremaybe
mitigatedifhecanprovethatevenifhehadnotbeenindefault,losswouldhaveoccurredjust
thesame.(Art.2215,CivilCode).

(6)MoraAccipiendi
.

(a)Thecreditorisguiltyofdefaultwhenheunjustifiablyrefusestoacceptpaymentor
performanceatthetimesaidpaymentorperformancecanbedone.Somejustifiablereasonsfor
refusaltoacceptmaybethatthepayorhasnolegalcapacityorthatthereisanoffertopayan
obligationotherthanwhathasbeenagreedupon.

(b)Ifanobligationarisesexdelicto(astheresultofacrime),thedebtorcriminalis
responsibleforloss,eventhoughthisbethroughafortuitousevent,unlessthecreditorisin
moraaccipiendi.Thelawsays:Whenthedebtofathingcertainanddeterminateproceeds
fromacriminaloffense,thedebtorshallnotbeexemptedfromthepaymentofitsprice,
whatevermaybethecausefortheloss,unlessthethinghavingbeenofferedbyhimtothe
personwhoshouldreceiveit,thelatterrefusedwithoutjustificationtoacceptit.(Art.1268,
CivilCode).[NOTE:Whatshouldthecriminaldoifthecreditorisinmoraaccipiendi?
126
CIVILCODEOFTHEPHILIPPINESArt.1169

ANS.:Hemusteither:
.

1)consignitincourt(expenseschargeabletocreditor);

2)orkeepithimself(hereheshouldstillexercisediligenceandcare,butthistime,hewould
notbeliableforlossduetoafortuitousevent).(See2Manresa361).(Lossthrurobberywith
violenceisafortuitouseventprovidedthattheviolenceorintimidationwasirresistibleor
grave.)]
(c)Theimproperrefusalofthelessor(creditor)toaccepttherentstenderedbythelesseeplaces
saidlessorindefault(mora)andhemustshoulderthesubsequentaccidentallossofthe
premisesleased.Themoraaccipiendiofsaidlessorisnotcuredbythelesseesfailuretomake
consignationoftherejectedpayments,butthelesseeremainsobligatedtopaytheamountshe
hadtenderedbutdidnotdepositincourt.(Vda.deVillaruel,etal.v.ManilaMotorCo.&
Caloniares,L10394,Dec.3,1958).
(7)ReciprocalObligations

(a)Reciprocalobligationsdependuponeachotherforperformance.(Example:Inasalethe
buyermustPAY,andthesellermustDELIVER.)

(b)Hereperformancemaybesetondifferentdates.[ExampledeliveryonDec.9,2005;and
paymentonDec.13,2005.Toputthesellerindefault,demandasarulemustbemade.
Delivery,upontheotherhand,doesnotputthebuyerindefault,tillafterdemand,unless
demandisnotrequired.Thisisbecause,intheexamplegiven,differentperiodsfor
performanceweregiven.(See8Manresa6364).]

(c)Iftheperformanceisnotsetondifferentdates,eitherbythelaw,contract,orcustom,itis
understoodthatperformancemustbesimultaneous.Hence,onepartycannotdemand
performancebytheother,iftheformerhimselfcannotperform.Andwhenneitherhas
performed,thereiscompensatiomorae(defaultonthepartofboth;soitisasifnooneisin
default).Ifonepartyperforms,andthe
127
Art.1169
CIVILCODEOFTHEPHILIPPINESotherdoesnot,thelatterwouldbeindefault.(SeeGutier

rezHermanosv.OriaHermanos,30Phil.491).
MarianoRodriguez,etal.v.PorfirioBelgica,etal.L10801,Feb.28,1961
FACTS:RodriguezandBelgicawerecoownersoflandintheproportionof86%and14%,
respectively.BelgicaowedRodriguezP30,000.ToenableBelgicatopayit,itwasmutually
agreedthatRodriguezwouldgrantauthoritytoBelgicatosellormortgagewithin70days
36%oftheland,sothatBelgicawouldbeabletoraisethemoneyforpaymentoftheloan.
Issue:Fromwhattimeshouldthe70dayperiodbegintorun?
HELD:TheperiodcommencesfromthetimeRodriguezgrantssaidauthoritytoBelgica.For
thispartakesofareciprocalobligationthegrantingoftheauthorityandthepaymentofthe
loan.Withoutsuchauthority,itwasdifficult,ifnotimpossible,forBelgicatoobtaintheneeded
P30,000.Thiswasbecauseheownedonly14%oftheland.
(8)WhenDamagesorInterestMayBeLost
AcreditorentitledtodamagesorinterestbecauseofMORAmaylosethesame
.

(a)Iftheprincipalobligationisallowedtolapsebyprescription;

(b)Ifthedamagesorinterestareallowedtoprescribe;

(c)Ifthedamagesorinterestarecondoned(waivedorremitted).
(9)SomeDecidedCases
CompaniaGeneraldeTabacosv.Araza7Phil.455
Ifadebtisnotpaidatthestipulatedperiod,interest(asdamages)shouldbechargednotfrom
thedateofmaturity,but
128
CIVILCODEOFTHEPHILIPPINESArt.1169

fromthetimethejudicialactionisfiled,incasenoextrajudicialdemandwasmade.
Price,Inc.v.Rilloraza,etal.L82053,May25,1955
FACTS:Atenantleasedalandonthelandlordspromisethatthelatterwouldmake
improvementsonthepropertyleased.Whenthelandlorddidnotmaketheimprovements,the
tenantsuedforspecificperformance,thatis,tomakethelandlorddotheimprovements.Three
dayslater,thelandlordsuedforunlawfuldetainerfornonpaymentofrent.
HELD:Thisisreciprocalobligation,andsincenoimprovementshaveyetbeenmade,the
landlordcannotdemandrentsandthetenantisnotyetindefault,andthereforeunlawful
detainercannotprosper.
Queblarv.GardunoandMartinez62Phil.879
FACTS:Adebtwaspayableininstallments.Itwasalsoagreedthatifanyinstallmentwasnot
paidontime,thewholedebtwouldmature(accelerationclause).Thedebtordidnotpayone
installmentontime.Aftersometime,becausethedebtordidnotpaythewholedebt,the
creditorbroughtthisaction.Issue:Fromwhattimewasthedebtorindefault,fromthetime
theinstallmentwasnotpaidatthestipulateddate,orfromthetimetheactionwasfiled?(This
wasessentialtodeterminethecomputationofinterest.)
HELD:Fromthetimedemandwasmadebythefilingoftheaction,therehavingbeenno
previousextrajudicialdemand.Hence,interestasdamagesshouldbeginonlyfromthatdate.
Reason:Itistruethattherewasanaccelerationclause,andthisiswhythecreditorisnow
entitledtorecoverthewholedebt.Butthecontractdidnotsaythatfailuretopayone
installmentwouldputthedebtorindefault.Hence,demandwasstillessential.
Causingv.Bencer37Phil.417
FACTS:PlaintiffA,actingasguardianofsomeminors,agreedtoselltodefendantBaparcelof
landownedincommon
129
Art.1169CIVILCODEOFTHEPHILIPPINES

byherandherwardsontheconditionthatAwouldfirstobtainjudicialapprovalwithregardto
thewardsshare.Bimmediatelypaidpartofthepurchasepriceandproceededtooccupythe
land.Althoughjudicialapprovalhadbeenobtained,Adidnotexecuteadeedsufficientto
conveythewholeparcel.Instead,sheaskedforthebalanceofthepurchaseprice.Failingin
this,shechargedBwithdefaultandnowwantstorescindorcancelthecontractontheground
ofnonpayment.
HELD:Inreciprocalobligationslikethis,defaultonthepartofonebeginsonlyfromthe
momenttheotherpartyfulfillswhatisincumbentuponhimorher.SincetheplaintiffRufina

Causinghasnotyetexecutedadeedsufficienttopassthewholeestate,sheisnotnowina
positiontorescindthecontract.
DelaRosav.BankofP.I.51Phil.926
Evenifprizesarenotdistributedonthedatesetintherulesofacontest,thesponsoring
companyisnotindefaulttillafterademandismade,forordinarilyonedoesnotenteracontest
justtogettheprizeonthedatespecified.
MalayanInsuranceCo.,Inc.v.CAGR59919,Nov.25,1986
Adebtorwhoincursindelayordefaultisliablefordamagesplusinterest,generallyfrom
extrajudicialorjudicialdemandintheformofinterest.
SpousesPuertov.CAGR138210,Jun.13,2002
FACTS:Petitionerscommittedabreachofobligationintheirrefusaltopayasumofmoney
loaned.Issue:Owingtosaidbreach,maycompensatorydamagesbeawarded?
HELD:Yes,bywayifaninterestistheamountof12%perannum,tobecomputedfrom
default,i.e.,fromjudicialorextrajudicialdemandinaccordancewithArt.1169.
SuchinterestisnotduetostipulationRatheritisduetothegeneralprovisionoflawthatin
obligationtopaymoney;
130
CIVILCODEOFTHEPHILIPPINESArt.1169

wherethedebtorincursindelay,hehastopayinterestbywayofdamages.(SeeEastern
ShippingLines,Inc.v.CA,234SCRA78[1994]).
(10)ImpositionofInterest
BangkoSentralngPilipinasv.SantamariaGR139885,Jan.13,2003
InEasternShippingLines,Inc.v.CourtofAppeals(234SCRA78[1994]),thefollowing
guidelineshavebeenlaiddownintheimpositionofinterest:
1.Whenanobligation,notconstitutingaloanorforbearanceofmoney,isbreached,an
interestontheamountofdamagesawardedmaybeimposedatthecourtsdiscretionwith6%
rateperannum.Nointerest,however,shallbeadjudgedonunliquidatedclaimsordamages
exceptwhenoruntildemandcanbeestablishedwithreasonablecertainty.Intheeventthat
demandisestablishedwithreasonablecertainty,interestshallbegintorunfromthetimeclaim
ismadejudiciallyorextrajudicially.(Art.1169,CivilCode).However,whensuchcertainty
cannotbesoreasonablyestablishedatthetimedemandismade,interestshallbegintorunonly

fromthedatethecourtjudgmentismade(atwhichtime,quantificationofdamagesmaybe
deemedtohavebeenreasonablyascertained).Actualbaseforcomputationoflegalinterest
shall,isanycase,beonamountfinallyadjudged.
2.Whencourtjudgmentawardingasumofmoneybecomesfinalandexecutory,therateof
legalinterest,whetherthecasefallsunderpar.1orpar.2above,shallbe12%perannumfrom
suchfinalityuntilitssatisfaction,thisinterimperiodbeingdeemedtobebythenanequivalent
toforbearanceofcredit.
Sincethecaseatbardoesnotinvolveanyobligationarisingfromloanorforbearanceof
money,theninterestshouldbeimposedasfollows:
a.OnthefirstbillingforP450,604.966%perannumcomputedfromthedateofdemandon
Feb.23,1996whileaninterestof12%perannumshallbeimposed
131
Art.1170
CIVILCODEOFTHEPHILIPPINES

onsuchamountfromfinalityofdecisionuntilpaymentthereof.
b.OnthesecondbillingforP62,451.056%perannumcomputedfromdateofdemandon
Sept.10,1996whileaninterestof12%perannumshallbeimposedonsuchamountfrom
finalityofdecisionuntilpaymentthereof.
c.OntheP108,610.52forservicesrenderedfromApr.10,1996toJul.31,19966%per
annumcomputedfromdateofdecisionofIAC(IntermediateAppellateCourt)onFeb.20,
1998whileinterestof12%perannumshallbeimposedonsuchamountfromfinalityof
decisionuntilpaymentthereof.
Art.1170.Thosewhointheperformanceoftheirobligationareguiltyoffraud,
negligence,ordelayandthosewhoinanymannercontravenethetenorthereof,areliable
fordamages.
COMMENT:
(1)GroundsforLiabilityinthePerformanceofObligations
.

(a)fraud(deceitordolo)(intentionalevasionoffulfillment).

(b)negligence(faultorculpa).(SeeArt.1173,CivilCode).

(c)default(ormora)(ifimputabletothedebtor).

(d)violationofthetermsoftheobligation(violatio)(unlessexcusedinpropercasesby
fortuitousevents).[NOTE:Thefollowingdonotexcusefulfillment:
1)increaseincostofperformance.(U.S.v.VaraderodelaQuinta,40Phil.48).
2)poverty.(Repidev.Alzelius,39Phil.190).
3)warbetweenthesubjectofaneutralcountryandthesubjectofacountryatwar,aslongas
substantialcompliancecanstillbedone.(Int.HarvesterCo.v.HamburgAmericanLine,42
Phil.854).
132
CIVILCODEOFTHEPHILIPPINESArt.1170

BUTchaosinManilainFebruary1945duringtheliberationperiodcanbeconsidereda
sufficientexcusefornotpayingontimetheobligationsmaturingthatmonth.(Manalacv.
Garcia,76Phil.216).]
(NOTE:InMcConnel,etal.v.CourtofAppeals,L10510,Mar.17,1961,itwasheldthateven
individualstockholdersmaybeheldliableforcorporateobligationswherevercircumstances
showthatthecorporateentityisbeingusedasanalteregoorbusinessconduitforthesole
benefitofthestockholdersorelsetodefeatpublicconvenience,justifywrong,protectfraud,or
defendcrime.Thefictionofseparatepersonalitycannotbeusedtoshieldfraud.InRivera,et
al.v.Colago,etal.,L12323,Feb.24,1961,theCourtheldthatthegovernmentofficials
concernedaredutyboundtoimplementtheprovisionsoftheminimumwagelawby
appropriatingthenecessaryamountsforthepaymentoftheincreasedsalariesofthe
employees.Suchappropriationcannotbeleftattheirdiscretionnorcansaidofficialavoid
compliancewiththeirdutybyinvokinglackoffunds.Whileordinarilythereshouldhave
beenacertificationoftheavailabilityoffunds,thisisNOTneededhere,forotheremployees
hadalreadybeenpaidpriortothecommencementofthiscase.Sincethedutyismandatory,
MANDAMUScanproperlyissue.)
Gatchalianv.Arlegui75SCRA234
Ifalosingpartylitigantdisobeysawritofpossessionaddressedbythecourtnottohimbutto
asheriff,saiddisobedientlitigantisnot,bythatfactofdisobediencealone,guiltyofcontempt
ofcourt.
(2)ExamplesofViolationofaContract(InAnyMannerContravenetheTenor
Thereof)
(a)Whenalandlordfailstomaintainatenantinthelegalpossessionoftheleasedland
(becausethelandlordwasnotitsowner,andtheownernowwantstooccupytheland).(De
133

Art.1170
CIVILCODEOFTHEPHILIPPINES

(b)(c)
(d)
laCruzv.SeminaryofManila,18Phil.330).Similarly,ifalesseeortenantdoesnotpaythe
stipulatedrentsdespiteoralandwrittendemandsbythelessororlandlord,thelatterisentitled
toajudgmentforejectmentandrecoveryofdamagessuffered.(DelosSantosv.Gorospe,et
al.,L12023,Apr.29,1959).
Whenapersonwhoagreedtosupplysomecinematographicfilmscannotdosobecauseofhis
fault.(AcmeFilmsv.TheatersSupply,63Phil.657).
Whenacommoncarrierfailstotakeitspassengerstotheirdestination.(Gutierrezv.Gutierrez,
56Phil.177).Whileovercrowdinginabusisnotnegligenceperse,stillthebusisunderaduty
toexerciseahighdegreeofcaretoprotectitspassengersfromdangerslikelytoarise
therefrom.Thus,ifasaresultofovercrowdingapassengerfalls,andanattemptedrescuebya
fellowpassengerisfrustratedbecausethebusdriverimmediatelystartsthevehicle,thebus
companycanbeheldliable.
Ifataxipassengerisintentionallykilledbythedriver,anactionfordamagescanbebrought
againstboththedriverandthetaxicompany(oroperator)underArt.1759oftheCivilCode.
Thedriver,true,didnotactwithinthescopeofhisauthority,butthenacarrier(likethe
company)mustaffordfullprotection.Thecarrierdelegatestothedriver(itsservant)theduty
toprotectthepassengerswithutmostcare.Thecompanythusbearstheriskofwrongfulor
negligentactsofitsemployeessinceithaspowertoselectandremove.(Marananv.Perez,
GRL22272,Jun.26,1967).
Ifapersonentersintoacontractwherehehastomeetcertainbankrequirements,butisunable
tomeetsaidrequirements,heisliableforbreachofcontract,ifheknewfromthevery
beginningthatsaidrequirementscouldnotbecompliedwithbyhim.(Arrietav.NARIC,L
15645,Jan.31,1964).
Santiagov.Gonzales79SCRA494
FACTS:Regardingacontractwithaconstructionfirm,theownerwrotethefirmthathe
intendedtocancel
(e)
134
CIVILCODEOFTHEPHILIPPINESArt.1170

thecontract,whereuponthefirmstoppedconstructionworkforallegednonpaymentoffeesat
thepropertime.Isthefirmliable?
HELD:No,forafterall,theadversepartyhadalreadyinformedthefirmoftheformers
intentiontocancelorrescindthecontract.
(3)LiabilityforDamages
ThoseliableunderArt.1170shouldpaydamages,butgenerallyonlyifasidefromthebreach
ofcontract,prejudiceordamagewascaused.(Bergv.Teus,GRL6453,Oct.30,1964).
BuayanCattleCo.,Inc.v.QuintillanL26970,Mar.19,1984
Evenifaleaseagreement(suchasthePastureLeaseAgreement)expires,theclaimsfor
damagesthataroseduringtheexistenceoftheleasecontinuetosubsist.Wecannotregardsaid
claimsashavingbecomemootandacademic.
Bobisv.Prov.SheriffofCamarinesNorteGR29838,Mar.18,1983
Ifasherifffollowstheliteraltermsofawritofexecution,heisnotliablefordamages.
Phil.LongDistanceTelephoneCo.v.NationalLaborRelationsCommissionGR58004,
May30,1983
Ifanemployeehasbeenlaidoffformorethanfour(4)yearsbutwasnotinthemeantime
prohibitedfromlookingforanotheremployment,hisbackwagesmaybelimitedorreduced.
Onemustminimizedamagesthathavebeeninflicteduponhim.Heshouldhavelookedfor
workinthemeantime.
(4)KindsofDamages(KeywordMENTAL)
(a)MORAL(formentalandphysicalanguish)135
Art.1170
CIVILCODEOFTHEPHILIPPINES

(b)(c)
(d)
(e)(f)
[NOTE:Theanguish,worryandanxietyofadefendantinalitigationthatwasnot
maliciouslylitigatedcannotbeconsideredasthemoraldamagescontemplatedinthelaw.
(Ramosv.Ramos,L19872,Dec.3,1974).]

CompaniaMaritimav.AlliedFreeWorkersUnion77SCRA24
Moraldamagescannotberecoveredunlessproved.Amereprayerforthesameisnot
sufficient.
EXEMPLARY(correctiveortosetanexample)NOMINAL(tovindicatearight
whennootherkind
ofdamagesmayberecovered)
(NOTE:InVentanillav.Centeno,L4333,Jan.28,1961,itwasheldthatnominaldamagesare
NOTforindemnificationofthelosssuffered,butforthevindicationofarightviolated,the
assessmentofwhichislefttothediscretionofthecourt.)
TEMPERATE(whentheexactamountofdamagescannotbedetermined)
ACTUAL(actuallossesaswellasunrealizedprofit)LIQUIDATED(predetermined
beforehandbyagree
ment)Damagesshouldbepaidbythoseresponsibleforthem.
(Encisov.Nacoco,[C.A.]46O.G.4321).
TravellersIndemnityCo.v.BarberSteamshipLines,Inc.77SCRA10
OnewhoclaimsdamagesbecauseofdamagetogoodsundertheBureauofCustomsarrastre
servicesshouldfiletheclaimwiththeCommissiononAuditinsteadoffilingthecasewiththe
regularcourts.TheBureauofCustoms,inoperatingthearrastreservice,doessoinconnection
withaprincipalgovernmentfunction.Assuch,neithertheBureaunortheRepublicmaybe
sued.Thus,theremedyiswiththeCommissiononAuditunderAct3083andCA327.
136
CIVILCODEOFTHEPHILIPPINESArt.1170

BagumbayanCorporationv.IntermediateAppellateCourt&LelisaSeaGR66274,
Sept.30,1984
Ifinarestaurant,awaiterfallsonaladycustomer,spillsdrinksonher,andcauseshertogoto
thecomfortroomandtakeoffherclothesandremainnaked,withouttherestaurantofferingher
anyapology,sheisentitledtoACTUALDAMAGES,butnottoMORALDAMAGES,forthe
mentalanguishandembarrassmentinthiscasecannotbeconsideredasfallingwithinthe
scopeofArt.2217oftheCivilCode.
(5)DamagesinMonetaryObligations

Inmonetaryobligations,indemnityfordamagesconsistsof:
.

(a)thatagreedupon;

(b)intheabsenceofagreement,thelegalrateofinterest.(Art.2209,CivilCode;Quirosv.
TanGuinlay,5Phil.675).Ifacontractofsimpleloanstipulatesthetimewheninterestwillbe
counted,saidstipulatedtimecontrols.(Piczonv.Piczon,L29139,Nov.15,1974).
(6)RemediesofProfessorsandTeachers
UndertheCivilCode,thereisnoprovisiongoverningtherelativerightsofateacheror
professor,andthoseoftheschoolthatdesirestodispensewiththeservicesoftheformer.
However,theremedycanbefoundtodayinRepublicAct1952(themesadaoronemonth
payrule)asamendedbyRA1787.(MapuaInstituteofTechnologyv.Manalo,L14885,May
31,1960).
(7)CreditorofaJudge
Taboadav.Cabrera78SCRA235
Ifacreditorofajudgewantstocollectasumofmoneyfromthelatter,thecreditorshouldnot
filethecivilcomplaintwiththeSupremeCourt.
137
Art.1171CIVILCODEOFTHEPHILIPPINES

Art.1171.Responsibilityarisingfromfraudisdemandableinallobligations.Any
waiverofanactionforfuturefraudisvoid.
COMMENT:(1)LiabilityforFraudorDolo
.

(a)Accordingtotimeofcommission,fraudmaybepastorfuture(liabilityforpastfraudmay
bewaived;thisisnotsoforfuturefraud).

(b)Accordingtomeaning,fraudmaybeclassifiedasfollows:1)fraudinobtainingconsent
(maybecausalormerelyincidental)
2)fraudinperformingacontract(inaccuratelyreferredtobysomeasincidentalfraud).Fraud
heremaybeeither:

a)dolocausante(causalfraud)

b)doloincidente(incidentalfraud)
(2)Whiledolocausanteissoimportantafraudthatvitiatesconsent(allowingtherefore

annulment),doloincidenteisnotimportant
Bangoyv.Phil.AmericanLifeInsuranceCompanyCAGR55652R
Ifaninsuredcommitsamaterialmisrepresentation,fraud,orconcealmentinhisinsurance
application,theinsurancecontractcannotberegardedasvalid.(Note:theannulmentcase
mustbewithintwoyearsfromtheperfectionofthecontract.)Ifthetruthhadbeentold,there
wouldhavebeennocontract,oronewouldhavebeenmadewithamuchhigherpremium
(consideringthetruestateofhealthoftheinsured).
(NOTE:Thefraudhereisimportant,andisreferredtoasDOLOCAUSANTE.)
138
CIVILCODEOFTHEPHILIPPINESArt.1172(3)TaxEvasion

Taxevasion(asdistinguishedfromtaxavoidance)connotesfraudthrutheuseofpretenses
andforbiddendevicestolessenordefeattaxes.However,ataxpayerhasthelegalrightto
decreasetheamountofwhatotherwisewouldbehistaxesoraltogetheravoidthembymeans
whichthelawpermits.Hedoesnotincurfraudtherebyevenifthetaxpaidisthereafterfound
tobeinsufficient.(Yutivo&SonsHardwareCo.v.CourtofTaxAppeals,etal.,L13203,Jan.
28,1961).
Art.1138.Inthecomputationoftimenecessaryforprescription,thefollowingrules
shallbeobserved:
(1)Thepresentpossessormaycompletetheperiodnecessaryforprescriptionbytacking
hispossessiontothatofhisgrantororpredecessorininterest;
(2)Itispresumedthatthepresentpossessorwhowasalsothepossessorataprevious
time,hascontinuedtobeinpossessionduringtheinterveningtime,unlessthereisproof
tothecontrary;
(3)Thefirstdayshallbeexcludedandthelastdayincluded.
COMMENT:
RulesforComputationofTime
Par.1TackingofPossession
(a)ThismeansADDINGtheperiodofpossessionofthepredecessor.Reason:Thetrueowner
ofthepropertywas
41

Art.1138
CIVILCODEOFTHEPHILIPPINES

(b)
(c)
afterallNOTinpossession,duringthepossessionofsaidpredecessor.
Tackingisallowedonlyiftherebeprivityofrelationshipbetweenthepredecessorandthe
successor,asinthecaseofsuccession,donation,sale,barter,etc.Thus,amereintruderor
usurpercannottack.(SeeRazotev.Razote,14Phil.182;Lacsonv.Govt.,39Phil.63).
Tackingbyasubsequentpossessorofhispredecessorspossessioncanbeallowedifthe
predecessorspossessioncansatisfytherequisitesforprescription(suchasthefactthatthe
possessionmustbeintheconceptofowner,peaceful,etc.).(See2CorpusJuris92and
Casilagv.Fajardo,CAGR1066RJun.18,1948,46O.G.570).
Par.2PresumptionofContinuingPossessionThepresumptionisexpresslydeclaredtobe
rebuttable.
Art.1344.Inorderthatfraudmaymakeacontractvoidable,itshouldbeseriousand
shouldnothavebeenemployedbybothcontractingparties.
Incidentalfraudonlyobligesthepersonemployingittopaydamages.
COMMENT:(1)RequisitesforFraudtoVitiateConsent
TworequisitesforfraudasagroundforannulmentaregiveninthisArticle:
.

(a)thefraudmustbeserious;

(b)thepartiesmustnotbeinparidelicto(mutualguilt),otherwise,neitherpartymayaskfor
annulment.Thecontractwould,therefore,beconsideredvalid.(SeeValdezv.Sibal,46Phil.
930).
(2)IncidentalFraudDoesNotVitiateConsent
Incidentalfraudshouldnotbeconfusedwithcausalfraud.Incidentalfraudisnotacausefor
annulment.

Art.1172.Responsibilityarisingfromnegligenceintheperformanceofeverykindof

obligationisalsodemandable,butsuchliabilitymayberegulatedbythecourts,
accordingtothecircumstances.
COMMENT:(1)FraudDistinguishedfromNegligence
DOLO

CULPA

(a)ThereisaDELIBERATEintentiontocausedamageorprejudice.

(a)Althoughvoluntary(thatis,n
DELIBERATEintentiontocause

(b)Liabilityarisingfromdolocannotbemitigatedorreducedbythe
courts.

(b)Liabilityduetonegligencem

(c)Waiverofanactiontoenforceliabilityduetofuturefraudisvoid.

(c)Waiverofanactiontoenfo
certainsensebeallowed.

Laurelv.Abroga483SCRA243(2006)
AmongtheprohibitedactsenumeratedinSec.9ofRANo.8484orAccessDevices
RegulationActof1998,are:
139
Art.11721.

2.
CIVILCODEOFTHEPHILIPPINES

theactsofobtainingmoneyoranythingofvaluethrutheuseofanaccessdevicewithintentto
defraudorintenttogainandfleeingafter;and
ofeffectingtransactionswithoneormoreaccessdevicesissuedtoanotherpersonorpersons
toreceivepaymentoranyotherthingofvalue.
UnderSec.11ofthelaw,conspiracytocommitaccessdevicesfraudisacrime.
(2)StipulationsRegardingNegligence(FutureNegligence)
.

(a)Grossnegligencecanneverbeexcusedinadvanceforthiswouldbecontrarytopublic
policy.

(b)Simplenegligencemayincertaincasesbeexcusedormitigated.

(c)Three(3)usualkindsofstipulationinabilloflading(contractfortheshippingor
transportingofgoods):
1)Thefirstoneexemptsthecarrierfromallliabilitiesforlossordamageoccasionedbyits

ownnegligence.(Thisisagainstpublicpolicyandisvoid).(SeeArt.1745,Nos.2and3,Civil
Code).Exampleofthisinvalidstipulation:Nomatterhownegligentthecarrierwillbe,it
willnotberesponsibleforthedamagecaused.
2)Thesecondonelimitstheliabilitytoanagreedvaluation,nomatterhowmuchdamageis
caused.(Inotherwords,nomatterhowmuchdamageiscaused,thevaluethatcanberecovered
isthesame.ThisisalsoVOIDsinceawealthycompanywouldbeabletoaffordbeing
negligent.)Example:Nomatterhownegligentthecarrierwillbe,andregardlessofthevalue
ofthegoods,itwillpaydamagesonlyuptoP100.00.(Sincethisisvoid,theactualdamage
maystillberecovered.)
3)ThethirdonelimitstheliabilitytoanagreedvalueUNLESStheshipperdeclaresahigher
valueandpays
140
CIVILCODEOFTHEPHILIPPINESArt.1172

ahigherrateoffreight.(Thisisvalidandenforceable,asarule).(FreixasCo.v.PacificMail
SteamshipCo.,42Phil.198andHeacockv.MacondrayandCo.,42Phil.205).(SeeAmerican
PresidentLines,Ltd.v.RichardA.Klepper,etal.,L15671,Nov.29,1960,wherethe
SupremeCourtawardedonlytheamountstatedinthebillofladingP500insteadof
P6,729.50theamountofactualdamages.Kleppercannoteludeitsprovisionssimply
becausetheyprejudicehim,andtakeadvantageofthosethatarebeneficial.)
Example:Nomatterhownegligentthecarriermaybe,itwillpaydamagesonlyuptoP100,
BUT,iftheshipperdeclaresthatthevalueofhisgoodsismorethanP100,andpaysahigher
rateoffreight,thendamagesmayberecoveredtotheextentofthevaluedeclared.[Thisis
ordinarilyvalidsinceitrewardshonesty;butsometimestheamountwillbeincreasedifthe
valueofthegoodsbeconsiderablyhigherthanthepricedeclaredaswhensilkcasesworth
P3,500eachwerelostbutthecarrieronlywantedtopayP300eachbecausetheshipperfailed
todeclareavaluehigherthanP300.Here,thecourtsaidthattogiveonlyP300foreachwould
beunconscionable,consideringthecircumstances.(SeeYsmaelandCo.v.Barretto,51Phil.
90).]
PhoenixAssuranceCo.v.Macondray&Co.,Inc.L25048,May13,1975
FACTS:AshipperinSouthCarolinasenttoacarriership(S.S.Fernbank)foreventualdelivery
toFloroSpinningMillsinManilaashipmentofoneboxandonecartoncontainingtextile
machinerysparepartsworth$4,183.74.Thevaluewas,however,NOTDECLAREDandsothe
usualchargeof$46.20wasmadeforthefreightage.Inthebillofladingwasprinteda
stipulationtotheeffectthatincaseoflossordamage,thecarriersliabilitywasfixedonlyat
$500,unlessahighervalueisdeclaredinthebillofladingandextrafreightagepaid,ifrequired
(thistimethe

141
Art.1172
CIVILCODEOFTHEPHILIPPINES

freightagewouldbeonavalueoradvalorembasis).Theshipmentwasinsuredfor$5,450with
PhoenixAssuranceCompanyofNewYork.Onarrival,itwasdiscoveredthataportionofthe
shipmenthadbeendamaged(totheextentof$1,512.78).TheFloroSpinningMillssuedboth
carrierandinsurance.ThePhoenixAssuranceCompanypaidtheequivalentof$1,512.78.In
turn,theinsurancecompanyaskedreimbursementfromthecarrier.Thecarrier,however,said
thatitwaswillingtoanswerforonly$500asstatedinthebilloflading.Issue:Howmuch
reimbursementmustbegiven$500or$1,512.78?
HELD:Reimbursementshouldbeforonly$500inviewofthestipulationinthebilloflading,
astipulationsanctionedbyourjurisprudence.(Heacockv.MacondrayandCo.,42Phil.205,
etc.andArts.1749and1750,CivilCode).Beitnotedthatnovaluehigherthan$500hadbeen
declared.(Notethe$500shouldbegivenintheconversionratethatwillexistatthetime
satisfactionofthejudgmentisactuallymade.)
(3)RuleinContractsofAdhesion
Thereisgreaterfreedomtostipulateonnegligenceifthepartiesareonanequalplane;not
wheretheyareobviouslyinunequalpositions(CONTRACTSOFADHESION)suchasinthe
caseofemploymentortransportationcontracts.(SeeArt.1745,CivilCode;2Castan532
533).Moreover,stipulationsonnegligencemustbestrictlyconstruedagainstthepartysitu
atedinahigherormoreadvantageousposition.(SeeMRRv.CompaniaTransatlantica,38
Phil.875).
DelgadoBrothers,Inc.v.CourtofAppeals,etal.L15654,Dec.29,1960
FACTS:DelgadoBrothers,Inc.weretheofficialunloadersofthecargoesshippedonthe
AmericanPresidentLines.Initscontractwiththelatter,aclausereads:We,theAmerican
PresidentLines,herebyassumefullresponsibilityandliabilityfordamagestocargoes,ship,or
otherwisearisingfromtheuseoftheunloadingcraneoftheDelgadoBrothers,Inc.andwewill
notholdsaidCompanyliableorresponsibleinanywaythereof.
142
CIVILCODEOFTHEPHILIPPINESArt.1172

OneRichardKleppershippedthrutheAmericanPresidentLinesaliftvancontainingcertain
personaleffects.Whilethevanwasbeingunloadedbythegantrycraneoperatedbythe
DelgadoBrothers,itfellonthepier,breakingthegoodsinside.Theshippingcompanywas
orderedtopayforthedamages.Issue:IstheDelgadoBros.,Inc.requiredtoreimbursethe
carrier?

HELD:No,becauseoftheexemptioninthecontractfromliabilityonthepartoftheDelgado
Bros.,Inc.TheexemptionisCLEAR.
NOTE:InWarner,Barnes&Co.,Ltd.v.Yasay(L12984,July26,1960),theSupremeCourt
heldthatwhilethedebtorwasnegligentinpayingforthecostofthefertilizerwhichhehad
purchasedoncreditpriortothelastwar,stillheshouldnotbechargedinterestduringthewar
years,sincehewasingoodfaith,andsincealsothecreditorwasaBritishcompanyand
thereforeanenemyoftheJapaneseoccupationforces.
(4)KindsofCulpaClassifiedAccordingtotheSourceoftheObligation
.

(a)culpacontractual(contractualnegligenceorthatwhichresultsinabreachofa
contract).

(b)culpaaquiliana(civilnegligenceortortorquasidelict).

(c)culpacriminal(criminalnegligenceorthatwhichresultsinthecommissionofacrime
oradelict).
(5)DistinctionsRetheThreeKindsofCulpa
CULPA

CULPA

CONTRACTUA
AQUILIANA
L

CULPA
CRIMINAL

(a)Negligenceis(a)merelyincidental,incidenttotheperformanceofanobligationalreadyexisting
becauseof
acontract.(Rakes
Negligencehereisdirect,substantive,andindependent.(Rakesv.AtlanticGulf&PacificCo.,7Phil.
395).
(a)Negligencehereisdirect,substantive,andindependentofacontract.
143
Art.1172
CIVILCODEOFTHEPHILIPPINES

v.AtlanticGulf&Pac.Co.,7Phil.395).
(b)Thereisapreexistingobliga
tion(acontract,eitherexpressorimplied).(Rakes

(b)Nopreexistingobligation(exceptofcoursethe
dutytobecarefulinallhumanactuations).(Rakes
Case).

(b)No

(except

Case).
(c)Proofneededpreponderanceof

(c)Proofneededpreponderanceofevidence.
evidence.(Barredov.Garcia,I.O.G.No.6,p.191). (Barredov.Garcia,I.O.G.No.6,p.191).

(c)Pro

ofguilt
Garcia

(d)Defenseofgoodfatherofafamilyinthe
selectionandsupervisionofemployeesisnot
apropercompletedefenseinculpacontractual
(thoughthismayMITIGATEdamages).(Cangco
v.ManilaRailroadCo.,38Phil.769andDeGuiav.
Meralco,40Phil.760).Herewefollowtheruleof
RESPONDEATSUPERIORorCOMMANDRE
SPONSIBILITYortheMASTERANDSERVANT
RULE).

(d)Defenseofgoodfather,etc,isaproperand
completedefense(insofarasemployersorguardians
areconcerned)inculpaacquiliana.(CangcoandDe
GuiaCases).

(e)Aslongasitisprovedthatthere
wasacontract,
(e)Ordinarily,thevictimhastoprovethenegligenceofthe
(e)Accusedispresumedinnocent
untilthecon
144
CIVILCODEOFTHEPHILIPPINES
Art.1172

andthatitwasnotcarriedout,itispresumedthatthedebtorisatfault,anditishisdutytoprovethat
therewasnonegligenceincarryingoutthetermsofthecontract.(CangcoCase;8Manresa71).
defendant.Thisisbecausehisactionisbasedonallegednegligenceonthepartofthedefendant.

(d)Thi

nal.He
employ
(SeeM

(CangcoCaseand8Manresa71).
traryisproved,soprosecutionhastheburdenofprovingthenegligenceoftheaccused.

(6)SomeIllustrativeExamples
(a)CULPACONTRACTUALApassengerinataxiwashurtbecauseofthetaxi
driversnegligence.
.

1)Thisisculpacontractual(therewasacontractofcarriagebetweenthepassengerandthe
ownerofthetaxicabcompany).Thisistrueevenifthepassengerhadnotyetpaid;truealso,
evenifhehadnomoneytopay;truealsoeveniftheaccidentoccurredasthepassengerwas
boardingthetaxi.(SeeLasamv.Smith,45Phil.657).

2)Thehurtpassengermaybringacivilcaseofculpacontractual(forbreachofthecontractof
carriage)againsttheownerofthetaxicabcompany,andnotagainstthedriver,becausethe
contractisbetweenthepassengerandtheowner,andnotbetweenthepassengerandthedriver,
whomerelyrepresentstheowner.Hence,properly,onlytheownershouldbethedefendant
(withoutprejudicetohisrighttoreimbursementfromhisdriver).(Sudov.Zamora,[C.A.]37
O.G.962andEncisov.Nacoco,[C.A.]46O.G.962givethecorrectrule,andnotGutierrezv.
Gutierrez,56Phil.177).

3)Iftheownercanprovethatheexercisedduediligenceintheselectionandsupervisionof
thedriver,said
145
Art.1172
CIVILCODEOFTHEPHILIPPINES

4)
ownerisstillresponsiblebecauseofrespondeatsuperiororthemasterservantrule(the
negligenceoftheservantisthenegligenceofthemaster).However,thisdiligenceofthe
ownermakeshimadebtoringoodfaithandthedamageswouldbemitigated.(SeeManila
RailroadCo.v.CompaniaTransatlantica,38Phil.875;Cangcov.ManilaRailroadCo.,38
Phil.769andDeGuiav.ManilaElectricCo.,40Phil.760).
Allthatthepassengermustproveistheexistenceofthecontractofcarriage,andthefactthat
therewasabreachbecausehedidnotarriveathisdestinationunhurt.Ifthecompanywantsto
escapeliability,itisitsdutytoprovethatthedriverwasreallycareful;otherwise,the
presumptionofthedriversnegligenceremains.(SeeCangcov.ManilaRailroadCo.,38Phil.
769,whereatrainpassenger,onalightingfromatrain,washurtwhenhefellonsacksof

watermelonscarelesslystrewnabout;seealso8Manresa71).
AntonioV.Roquev.BienvenidoP.BuanL22459,Oct.31,1967
FACTS:InabusboundforPampanga,apassenger(AntonioV.Roque)wasinjuredasa
resultofthedriversviolentswervingtotherighttoavoidaheadoncollisionwithanother
vehicle.Issue:Isthebuscompanypresumednegligent?
HELD:Yes,thebusorcommoncarrierispresumednegligentincaseofdeathorphysical
injuriestopassengersunlessitprovestheexerciseofextraordinarydiligence.Indeedwhen
theactionisbasedonacontractofcarriage,andnotoftort,thecourtneednotmakeanexpress
findingoffaultornegligenceonthepartofthecarrier,foritsobligationistotransportthe
passengersafely.(SeeDySyv.MalateTaxicab,etal.,L8937,Nov.29,1957).
Ifthetaxicontaineddefectiveparts,thisisalsonegligenceonthepartofthecompany.The
companycannotclaimforcemajeureasanexcusehere.(Lasamv.Smith,45Phil.657).
5)
146
CIVILCODEOFTHEPHILIPPINESArt.1172

SanPedroBusLinev.NavarroL6291,Apr.29,1954
FACTS:Apassengeronatruckwashurt,butinacriminalcaseagainstthedriver,saiddriver
wasacquitted.Thevictimnowsuestheownerofthetruckforculpacontractual.Issue:May
thesuitstillprosper?
HELD:Yes,becausetheactionisbasedonacontract.Itissufficientforhimtoprovethe
existenceofthecontractofcarriageandtheinjuriessuffered.Itisnotnecessaryforhimto
provethenegligenceofthedriverforthisispresumedhere.(Ofcourse,ifthedrivercanprove
hewasnotnegligent,thecompanywouldnotbeliable.)
.

6)Instancesofrecklessnessonthepartofthedriver:
a)drivingatanunjustifiedrateofspeed;
b)flagrantviolationsoftheelementarycourtesiesoftheroad;
c)failuretosignalproperly;
d)deliberateentryononewaystreets;
e)hisintoxicationatthetimeofthemishap[asdistinguishedfromthemeredrinkingofhard
liquor](Wrightv.ManilaElectricCo.,28Phil.122);

f)ingeneral,anattempttopassanothervehiclewhichfailstogiveway(Claytonv.McIllnath,
241Iowa1162).
.

7)Instancesofrecklessnessonthepartoftheowner,oroperatorhimself:
a)failuretorepairdefectivepartsinthevehicle
(Lasamv.Smith,45Phil.657andJoseSonv.CebuAutobusCo.,L6155,April30,1954)or
allowingawornoutconditionofthevehicle(DavaoGulfLumberCorp.v.N.BaensdelRosa
rio,L15978,Dec.29,1960)orthefailureofthecarriertoprovideanycoverattherightside
ofthebustosafeguardpassengerssittingthereat
147
Art.1172
CIVILCODEOFTHEPHILIPPINES

b)
(c)
fromfallingtherefrom.Failureofthepassengertoholdontothearmoftheseatinsteadofthe
handofafriendmitigateshowevertheliability.(LagunaTayabasBusCo.v.Cornista,L
22193,May29,1964).
failuretofurnishacompetentandtesteddriver,towhomtheowneroroperatormustissue,
whenessential,properinstructionsforsafemaneuveringonthehighway.(Carfv.Medel,33
Phil.37).
failuretodetectadefectinanappliancepurchasedfromamanufacturer,adefectthatcould
havebeendiscoveredbythecarrier.(Necessitov.Paras,etal.,GRL10605andL10606,Jun.
30,1958).(Here,theCourtsaidthatapassengerdoesnothavetheopportunityforinspection,
whichordinarily,isavailabletothecarrier.)
LourdesMunsayacv.BenedictadeLaraL21151,Jun.26,1968
FACTS:Adriverofajeepneywasfoundrecklesslynegligent,therebycausinginjuriestohis
passenger.Istheowneroperatorofthejeepneyliableforexemplarydamages(inadditionto
otherkindsofdamages)?
HELD:Notnecessarily.Aprincipalormastercanbeheldliableforexemplaryorpunitive
damagesbaseduponthewrongfulactofhisagentorservantonlywhenheparticipatedinthe
doingofsuchwrongfulactorhaspreviouslyauthorizedorsubsequentlyratifiedit,withfull
knowledgeofthefacts.Exemplarydamagespunishtheintentandthiscannotbepresumed
onthepartoftheemployermerelybecauseofthewanton,oppressive,ormaliciousintenton

thepartoftheagent.
148
CIVILCODEOFTHEPHILIPPINESArt.1172

Ambaan,etal.v.Bellosillo,etal.CAGR56874R,Jul.8,1981
Theinjuredpassengersofapublicutilityjeepdrivenbyarecklessdrivercansuetheowner
operatorsofthejeepwithoutthenecessityoffirstbringingacriminalcaseagainstsaiddriver.
ThegoverninglawinsuchacaseistheCivilCodewhichrequirescommoncarrierstocarry
theirpassengerssafelytotheirdestinations,withtheexerciseofextraordinarydiligence.
Consideringthenegligenceofthedriver,itisclearthatunderthemasterandservantrule,the
liabilityoftheownersoperatorsisnotsubsidiary,butdirectandimmediate.Indeed,the
negligenceoftheservantincontractualobligationsisthenegligenceofthemaster.Themaster
andservantruleisalsoknownasthedoctrineofrespondeatsuperior.Underthisrule,the
master,toescapeliability,cannotputupthedefenseofagoodfatherintheselectionand
supervisionofemployees(excepttomitigatesaidliability,ifthisdefenseisdulyproved).
(b)CULPAAQUILIANA
Apedestrianwashitbyataxiandsufferedphysicalinjuries.Thetaxidriverwasnegligentand
wasresponsiblefortheinjury.
.

1)Thisisculpaaquiliana,therebeingnopreviousexistingcontractualrelationsbetweenthe
pedestrianontheonehand,andthetaxidriverandtheownerofthetaxicabcompany,uponthe
otherhand.(SeeHernandezv.Meralco,40O.G.10S.No.11,p.35;Liliusv.Manila
RailroadCo.,59Phil.758andGutierrezv.Gutierrez,56Phil.177).

2)Theinjuredpedestriancanbringanactionbasedonculpaaquiliana(tortorquasidelict)
againstBOTHthetaxidriverandtheowneroroperatorofthetaxicabcompany.Reason:The
driverisresponsibleforhisnegligenceinmakingpossibletheinjury.
149
Art.11723)
CIVILCODEOFTHEPHILIPPINES

THEREFORE,inthiscaseofculpaaquiliana,iftheownercanproveduediligenceinthe
selectionandsupervisionofhisdriver,hecouldnothavebeenresponsibleinanywayforthe
injury.Thus,thisdefenseisproperfortheemployer,andifproved,willexempthimfrom
liability.(Here,themasterservantruledoesnotapply).(Bahiav.Litonjua&Leynes,30Phil.
424andHernandezv.Meralco,40O.G.[10S]No.14,p.35).
Sinceitisthepedestrianwhoallegesnegligenceonthepartofthedefendant,itishis(the

pedestrians)dutytopresentandprovesaidnegligence.Inotherwords,hewillhavetheburden
ofproof.AsstatedbytheSupremeCourt:Asageneralrule,itislogicalthatincaseofculpa
aquiliana,asuingcreditorshouldassumetheburdenofprovingtheexistenceofthe
negligence,astheonlyfactuponwhichhisactionisbased.(Cangcov.ManilaRailroadCo.,
38Phil.769,citingManresa).
Ibaez,etal.v.NorthNegrosSugarCo.,Inc.,etal.L6790,Mar.28,1955
Passengersofaprivateautomobilewhobroughtacriminalactionagainstthedriverofatrain,
andwhoreservedacivilactionagainstthetrainowner,canstillbringonthebasisofculpa
aquilianathecivilcaseagainstthetrainowner,evenifthedriverbeacquittedinthecriminal
case.
(NOTE:Evenwithoutreservation,thecivilcasecanalsoprosper.Thisisbecausethetrain
ownerisnotreallyadefendantinthecriminalcase.Moreover,seeArt.2177,CivilCode.)
Ramosv.PepsiColaL22533,Feb.9,1967
FACTS:AdriverofPepsiColaisadmittedlynegligentinavehicularcollision.Suitwas
brought
4)
150
CIVILCODEOFTHEPHILIPPINESArt.1172

bytheothercarowneragainstboththedriverandPepsiCola.ButPepsiColawasableto
provediligenceinselection(noculpaineligiendo)andsupervision(noculpainvigilando)of
thedriver.Issue:IsPepsiColastillliable?
HELD:No,otherwiseitwouldhavebeenliablesolidarilywiththedriver.InPhilippinetorts,
wedonotfollowthedoctrineofrespondeatsuperior(wherethenegligenceoftheservantis
thenegligenceofthemaster).Instead,wefollowtheruleofbonusfamilias(goodfatherofa
family).Thenegligenceoftheemployerhereisonlypresumptive;itcanthereforebe
rebutted,asinthiscase.
Vinluanv.CourtofAppealsL2147781,Apr.29,1966
FACTS:Apassengerofabuswashurtbecauseofthenegligenceofthedriverofthebusas
wellasthenegligenceofthedriverofanothervehicle.Issue:Whoshouldbeliable?
HELD:Accordingtothecourt,fourpersonsareliable:theownerofthebus,thedriverofthe
bus,theowneroftheothervehicle,andthedriverofsaidothervehicleandtheirliabilityis
SOLIDARYnotwithstandingthefactthattheliabilityofthebuscompanyispredicatedona
CONTRACT,whiletheliabilityoftheowneranddriveroftheothervehicleisbasedona

QUASIDELICT.(Observation:Thebusdrivercanbeexcusedonthebasisofculpa
contractualforthecontractofcommoncarriagewasnotwithhim,butwiththebuscompany;
nonetheless,hecanbeheldliableonthebasisofculpaaquiliana,therebeingnopreexisting
contractbetweenhimandthepassenger.Notealsothattheowneroftheothervehiclecanbe
excusedifhecanproveduediligenceintheselectionandsupervisionofhisdriver,underArt.
2180,lastparagraph,unlessatthetimeofthecollision,saidownerwasalsoinhisvehicle,in
whichcase,notwithstandingduecareinselectionandsu
151
Art.1172
CIVILCODEOFTHEPHILIPPINES

(c)
pervision,hewouldstillbeliable,ifhecouldhave,byuseofdiligencepreventedthe
misfortune.(SeeArt.2184,CivilCode).
Peoplev.AlejandroO.Tan,Jr.CAGR21947CR,Jul.21,1981
Ifadriverononesideofthestreetdesirestocrossthesametobeontheotherside,itisnotsuf
ficientforhimtoputontheleftsignallightofthevehicle.Itisofjudicialnoticethatmany
driversinourcountrytodaypaylittleheedtosuchasignal,particularlyifthevehiclebeing
drivenbyanapproachingdriverisspeeding.Whatthedriverintentoncrossingshoulddoisto
simplyWAITfortheothervehicletopass,forafterall,theotherdriverhastherightofway.
Failuretosowaitissheernegligence.
CULPACRIMINAL
Apedestrianwasinjuredbecauseoftherecklessnessofataxidriver.Aswehavealreadyseen,
thepedestriancanbringanactionofculpaaquilianaagainstthedriverandtheownerofthe
taxicompany.Butifthepedestrianwants,hemaybringanactionforculpacriminal(physical
injuriesthrurecklessimprudence).Inthesameway,passengermaybringnotonlyasuitfor
culpacontractualbutalsoasuitforculpacriminal(physicalinjuriesthrureckless
imprudence).
Proceduretobefollowed:
Theinjuredpedestrianwillfileacriminalcaseagainstthedriver(notagainsttheowner).Ifthe
driverisfoundguilty,theownerwillbesubsidiarilyliableifthedriverisinsolvent.Theowner
willnotbeallowedtopresentthedefenseofduediligenceintheselectionandsupervisionof
hisemployee,forhisliabilityisautomaticandsubsidiary.Thereisnonecessityofpreviously
reservingthecaseagainsttheowner(becausetheownerisnotadefendantinthecriminal
case).Afterthecriminalcaseisterminated,theconvicteddrivershouldpay.Ifthedriverbe
insol

152
CIVILCODEOFTHEPHILIPPINESArt.1172

(7)SomeCases
(NOTE:Ifapassengersuesforculpacriminal,substantiallythesameprocedureastheabove
wouldbefollowed.)
Barredov.GarciaandAlmario73Phil.607
vent,thevictimcannowfileacivilactionagainsttheownertorecoveronthelatters
subsidiaryliability.Allthevictimhastodois:
.

a)Topresentthejudgmentinthecriminalcase,declaringthedriverguilty.

b)Topresentproofofdriversinsolvencybyshowingthattheexecutionattemptedbythe
sheriffcouldnotbesatisfied.Intheabsenceofcollusionbetweenthedriverandprosecuting
attorney,oncethe2exhibitsarepresentedorproved,thejudgeshouldordertheownertopay.
Theownerwillnotbeallowedtopresentanydefenseanymore.Hecannot,however,besaid
tohavebeendeprivedofhisdayincourtbecausehealsohadhischance,namely,inthe
criminalcaseagainstthedriver.Insaidcase,heshouldhavegivenhisdriveragooddefense
counsel,becauseindefendingtheinterestofthedriver,theownerwouldalsobedefendinghis
owninterest,forhisliabilityisautomaticanddependentonthedriversguiltandinsolvency.
Thisistheruleinculpacriminal.(SeeMariaLuisaMartinezv.ManuelH.Barredo,etal.,GR
49308andBarredov.Garcia,73Phil.607).
FACTS:AtaxidriverofBarredokilledGarciathrurecklessdrivingwhenthedriverhitthe
carretelawhereGarciawasapassenger.Thedriverwasfoundguiltyinthecriminalcase
(culpacriminal).Butthecivilactionhadbeenreserved.Later,theheirsofGarciabroughta
civilaction(culpaaquiliana)directlyagainstBarredo,theownerofthetaxicabcompany
153
Art.1172CIVILCODEOFTHEPHILIPPINES

(MalateTaxicabCompany).ItwasprovedthatBarredowasnegligentforhisdriverhadbeen
employedbyhimevenifhehadpreviouslybeenconvictedforviolationoftheAutomobile
Law.Barredocontended,however,thattheactionshouldnothavebeenbroughtagainsthimat
once,becauseaccordingtotheRevisedPenalCode,heshouldbeliableonlyifthedriver
cannotpay,andthattherefore,thecivilactionshouldhavebeenbroughtfirstagainstthedriver,
andthen,ifthedriverisfoundguiltyandinsolvent,thiswouldnotbethepropertimetotake
theactionagainsthim(Barredo).Decide.
HELD:Barredoisconfused.Itistruethatinacivilobligationarisingfromacrime,the
employerwouldbeonlysubsidiarilyliableincasetheemployeecommittedthecrimeinthe

dischargeofhisduties.BUTthiscaseisnotoneofthecivilliabilityarisingfromacrime,but
onearisingfromaquasidelictorculpaaquiliana.AndundertheCivilCodeprovisionson
torts,anemployerinacaselikethisisnotmerelysubsidiarily,butprimarilyliable,and
thereforeacasecanbebroughtdirectlyagainsthim.Hisdefensecanbeduediligenceinthe
selectionandsupervisionofhisemployees,buthere,hewasprovedtobenegligent.Hence,he
canbemadetopayimmediately.
Nagraniav.Muluaney,Inc.L8326,Oct.24,1955
FACTS:Thedriverofanemployerwascriminallyfoundguiltyofdamagetoproperty,and
becausehewasinsolvent,theemployerwassuedforhissubsidiarycivilliability.Thevictim
askedforP1,300,buttheemployer,inhisanswer,admittedliabilityforonlyP300(orP1,000
less).Issue:Ifbothpartiesaskedforjudgmentonthepleadings,cantheemployerbeheld
liableforthewholeP1,300whichhadbeenadjudgedasthedriversliability?
HELD:Yes,becauseofhisautomaticsubsidiaryliabilityoncethedriverisfoundcriminally
guiltyandinsolvent.TheofferofP300wasanimpliedadmissionofboththedrivers
convictionandinsolvency.Thatheadmittedalessamountisimmaterialfor,underthelaw,his
isacompletesubsidiaryliability.
154
CIVILCODEOFTHEPHILIPPINESArt.1172

MariaLuisaMartinezv.ManuelB.Barredo,etal.,GR49308
FACTS:OnApr.11,1940ataxicabownedbyFaustoBarredoanddrivenbyRosendoDigman
collidedwithaChevroletcardrivenbyMariaLuisaMartinez.Acriminalcasewasinstituted
againstthetaxidriver,whopleadedguilty,andwasmadetopayafineandtoindemnify
Martinez.DuetoDigmansinsolvency,MartinezfiledanactionagainstBarredotoholdhim
subsidiarilyliable.Atthetrial,Martinezreliedsolelyon:
.

a)thejudgmentofconvictionagainstDigman;

b)thewritofexecutionissuedagainstDigmanandproofofhisinsolvency.ISSUE:Wouldthe
evidenceofMartinezbesufficientto
holdBarredocivillyliable?
HELD:Yes,thejudgmentofconvictionplusproofofinsolvencyissufficienttoholdthe
employersubsidiarilyliable;intheabsenceofcollusionbetweenthedriverandthevictim,the
stigmaofacriminalconvictionsurpassesineffectmerecivilliability.Commonsensedictates
thatafindingofguiltinacriminalcaseinwhichproofbeyondreasonabledoubtisnecessary,
shouldnotbenullifiedinasubsequentcivilactionrequiringonlypreponderanceofevidence.
Barredocannotbesaidtohavebeendeprivedofhisdayincourtbecausetheliabilityreally

dependeduponthedriversguiltandinsolvency,theliabilitybeingautomaticandsubsidiary.It
ishightimethatemployersshouldhavetheiremployeesdefendedverywell,supplyingthem
withcounsel,forindefendinghisemployeesinterest(inacriminalcase),he,theemployer,is
automaticallydefendinghimself.Itwouldhavebeendifferenthadthecasebeenoneofculpa
aquiliana.
[NOTE:ThisrulingwasreiteratedinthecaseofManalo,etal.v.RoblesTrans.Co.,Inc.,L
8171,Aug.16,1956.InsaidcasetheCourtalsoheldthatthesheriffsreturnofthewritof
executionshowingnonsatisfactionofthejudgmentbecauseofaccusedsinsolvencywas
admissibleinevidenceandthesheriffdoesnotneedtotestifyincourtastothefactstatedin
theentrybecauseitisanofficialjudgment.Moreover,thecivilcasecan
155
Art.1172CIVILCODEOFTHEPHILIPPINES

bebroughtnotwithinonlyfouryearsbutwithinten(10)yearsbecauseitarisesoutofafinal
judgment.]
PeopleofthePhilippinesv.JesusVeranoL15805,Feb.28,1961
FACTS:DominadorParas,apassengerinatruckoftheMindanaoBusCo.,waskilledwhen
thetruckdrivenbyJesusVeranofiguredinavehicularaccident.TheBusCo.paidtheheirsof
thedeceasedP3,000.Mrs.Paras,inherownbehalf,andonbehalfofherminorchildrenwith
thedeceased,waivedfurtherrightstorecoverdamages.Veranowassubsequentlychargedwith
homicidethrurecklessimprudence.Aftertrial,thelowercourtfoundhimguilty.Inadditionto
thesentenceofimprisonment,Veranowasorderedtopaytheheirsofthedeceased,Paras,the
sumofP5,000withsubsidiaryimprisonmentincaseofinsolvency.Theissuesarewhetherthe
waiverinfavorofthecompanyembracesthecivilliabilityofthedriver;whethertherightto
recoveruponthecivilliabilityarisingfromthecrimemaybewaivedandwhethersuchwaiver
maybemadeinbehalfoftheminorheirsbytheirmother.
HELD:
.

a)Thewaiverinfavorofthecompanyincludesthecivilliabilityofthedriver,forincaseof
insolvencyonthepartofthedriver,thecompanyisliableundertheRevisedPenalCode.For
theheirstoalsorecoverfromthedriverwouldbetograntthemdoubleindemnity.

b)UndertheRulesofCourt,civilliability,whetherarisingfromacrimeornot,canbewaived.

c)ThewaiverbyMrs.Parasinherownbehalfisvalid,butnotthatinbehalfofherminor
children,sincealthoughsheistheadministratoroftheirproperty,thewaiverorcompromise
shouldhavehadcourtapproval,beinganactofownershipandnotmereadministration.(Arts.
320,2032,CivilCodeandVisayanv.Suguitan,L8300,Nov.18,1955).Therefore,since

P3,000hadalreadybeenpaid,theheirsmaystillrecoverP2,000,thepartthathadNOTbeen
validlywaived.Inotherwords,theindemnityinthecriminalcasewasreducedtoP2,000.
156
CIVILCODEOFTHEPHILIPPINESArt.1172

d)Art.2177says:ResponsibilityforfaultornegligenceunderArt.2176culpaaquiliana
isentirelyseparateanddistinctfromthecivilliabilityarisingfromnegligenceunderthe
PenalCode(exdelicto).Buttheplaintiffcannotrecovertwiceforthesameactoromissionof
thedefendant.
Viratav.OchoaL46179,Jan.31,1978
Adriversacquittalinacriminalcaseisnotabartoacivilcasefordamages.Whatis
prohibitedisadoublerecoveryforthesamenegligentact.
(8)EffectsofVictimsOwnNegligenceandofHisContributoryNegligence
(a)Whenaplaintiffsownnegligencewastheimmediateandproximatecauseofhisinjury,he
cannotrecoverdamages(becausethereisnoculpaaquilianaonthepartofthedefendant).
(Art.2179,CivilCode).Example:Apedestrian,notlookingwherehewasgoing,bumpedinto
acarefullydrivencar.Hecannotrecoverdamagesinculpaaquiliana.Asamatteroffact,if
anydamagewascausedthecar,theownercanrecoverfromthepedestrian.
Ongv.MetropolitanWaterDistrictL7664,Aug.29,1968
FACTS:Avisitorwasdrownedinaswimmingresortduetohisownnegligence,anddespite
measuresonthepartoftheresortauthoritiestosavehim.Issue:Istheresortliable?
HELD:No,theresortisNOTliable.Whileitisdutyboundtoprovideforsafetymeasures,
stillitisnotanabsoluteinsurerofthesafetyofitscustomersorvisitors.Thedoctrineoflast
clearchancecannotapplyifthe:
.

1)negligenceoftheplaintiffisconcurrentwiththenegligenceofthedefendant;

2)partychargedisrequiredtoactinstantaneously;157
Art.1172
CIVILCODEOFTHEPHILIPPINES

(b)
IftheplaintiffsnegligencewasonlyCONTRIBUTORY,theimmediateandproximatecauseof
theinjurybeingthedefendantslackofduecare,theplaintiffmayrecoverdamages,BUTthe
courtsshallmitigatethedamagestobeawarded.(Art.2179,CivilCode).

Rakesv.AtlanticGulfandPacificCo.7Phil.359
FACTS:Rakes,aNegro,wasatworktransportingironrailsfromabargeintheharbortothe
yardoftheAtlanticGulfandPacificCompany.Atacertainspot,therailroadtrackbroke,upset
thecart,andhitRakes.Hislegwasafterwardsamputated.Itwasprovedthatthecauseofthe
accidentwasadefectinthetrack,adepressiontherein.Previouslythedepressionhadbeen
noticed,buttherepairuponitwasdonenegligently.Thereisnoquestionthereforeofthe
Companysnegligence.ButtheCompanycounteredbysayingthatRakeshimselfwas
negligentintworespects:
.

1)Althoughhenoticedthedepression,hestillcontinuedwithhiswork;

2)Insteadofwalkinginfrontorbehindthecar,Rakeswalkedattheside.TheCourtdismissed
thefirstgroundbysayingthat
Rakesdidnotknowthatthetrackhasbeenrepairednegligently.Thesecondground,
however,wasadmittedtoshowRakesnegligence.
Issue:IsthisnegligenceofRakessufficienttobarhimfromarecoveryofdamages?
HELD:No,thisnegligenceofRakesdidnotbarhimfromrecoveringdamages.Rakesdidnot
contributetothe
3)
injurycannotbeavoideddespitetheapplicationatalltimesofallthemeanstoavoidtheinjury
(aftertheperilis,orshouldhavebeen,discovered),atleastinallinstanceswheretheprevious
negligenceofthepartychargedcannotbesaidtohavecontributedtotheinjuryatall.
158
CIVILCODEOFTHEPHILIPPINESArt.1172

accident;heonlycontributedtotheinjuryordamageuponhimself.Therefore,hecanstill
recover,butthedamagesshouldbereducedormitigatedbecauseofhisowncontributory
negligence.
(9)SomeDoctrines
.

(a)Ifanemployercompanyfailstowarnanignorantemployeetobecarefulaboutan
unfamiliarmachine,itshouldrespondfordamagesincaseofinjury.(Tamayov.Gsell,35
Phil.953).

(b)Themerefactthatamanwasdrunkatthetimeofanaccidentdoesnotmeanhewas
negligent,providedheexercisedduecare.(Wrightv.ManilaElectricCo.,28Phil.122).

(c)Storingpotatoesinaverytightandunventilatedlorcherunderaburningsuncausingthem
torotisgrossnegligence.(HashimandCo.v.RochaandCo.,18Phil.315).

(d)Abandoningatowedvesselinacalmseajustbecausethetowlinebroke,andwithfull
knowledgethatitmightgetlost,isnegligence.(Guzmanv.X&BehnandMeyer,&Co.v.
Phil.MotorsCorp.,55Phil.129).

(e)Ifastreetcarpassengerishurtbecauseofanaccidentwheretherewasnonegligenceatall,the
streetcarcompanycannotbeliableforculpacontractualfortherewasnonegligence.(Carlos
Gocov.Meralco,37O.G.p.2275).Atireblowoutdoesnotconstitutenegligenceunlessthe
tirewasalreadyoldandshouldnothavebeenusedatall.Indeed,thiswouldbeaclearcaseofa
fortuitousevent.(Rodriguezv.RedLineTransportationCo.,[C.A.]51O.G.3006,June.1955).

(f)Negligenceisaquestiondependinguponthefactsofeachparticularcase;indeeditisa
questionoffact.(Tuckerv.Milan,[C.A.]49O.G.4379).
(10)LiabilityfortheCulpaAquilianaofOthers
(a)Thefatherand,incaseofhisdeathorincapacity,themother,areresponsibleforthe
damagescausedbytheminorchildrenwholiveintheircompany,unlesstheparentcanprove
thatheorsheobservedallthediligenceof
159
Art.1173

(b)
(c)
(d)
(e)
CIVILCODEOFTHEPHILIPPINESagoodfatherofafamilytopreventdamage.(Art.2180,

CivilCode).
Guardiansareliablefordamagescausedbytheminorsorincapacitatedpersonswhoareunder
theirauthorityandliveintheircompany,unlesssaidguardiansobservedallthediligenceofa
goodfatherofafamilytopreventdamage.(Art.2180,CivilCode).
Employersshallbeliableforthedamagescausedbytheiremployeesandhouseholdhelpers
actingwithinthescopeoftheirassignedtask,eventhoughtheformerarenotengagedinany
businessorindustry,unlesssaidemployerscanprovethattheyobservedallthediligenceofa

goodfatherofafamilytopreventdamage.(Art.2180,CivilCode).
Whoeverpaysforthedamagecausedbyhisdependentsoremployeesmayrecoverfromthe
latterwhathehadpaidordeliveredinsatisfactionoftheclaim.(Art.2181,CivilCode).
Provinces,cities,andmunicipalitiesshallbeliablefordamagesforthedeathoforinjuries
sufferedbyanypersonbyreasonofthedefectivebuildings,andotherpublicworksunder
theircontrolorsupervision.(Art.2189,CivilCode).
Goldinv.Lipkind(Fla)49So.2nd,53927ALR2d816(1953)
Aninnkeeperisunderadutytoexerciseordinarycaretokeephallwaysreasonablywelllighted
andfreefromobstructionsandwill,therefore,beliableincaseaguestisinjuredwhenthe
hallwaytohisroomisnotlighted,andhetripsoveramattresscarelesslyplacedinthedark
hall.