1.
DELOS SANTOS VS JARRA Octaviano claimed that they have ownership over lots 1,
Facts: The Plaintiff Felix delos Santos filed this suit
against Agustina Jarra. Jarra was the administratix
of the estate of Jimenea. Plaintiff alleged that he
owned 10 1st class carabaos which he lent to his
father-in-law Jimenea to be used in the animal-
power mill without compensation. This was done
on the condition of their return after the work at the
latters mill is terminated. When delos Santos
demanded the return of the animals Jimenea
refused, hence this suit. Issue: W/N the contracts
is one of a commodatum Ruling: YES. The
carabaos were given on commodatum as these
were delivered to be used by defendant. Upon
failure of defendant to return the cattle upon
demand, he is under the obligation to indemnify
the plaintiff by paying him their value. Since the 6
carabaos were not the property of the deceased or
of any of his descendants, it is the duty of the
administratrix of the estate to either return them or
indemnify the owner thereof of their value.
2. CATHOLIC VICAR VS CA
Facts:
- 1962: Catholic Vicar Apostolic of the Mountain Province
(Vicar), petitioner, filed with the court an application for
the registration of title over lots 1, 2, 3 and 4 situated in
Poblacion Central, Benguet, said lots being used as sites
of the Catholic Church, building, convents, high school
building, school gymnasium, dormitories, social hall and
stonewalls.
- 1963: Heirs of Juan Valdez and Heirs of Egmidio
2 and 3. (2 separate civil cases)
- 1965: The land registration court confirmed the
registrable title of Vicar to lots 1 , 2, 3 and 4. Upon appeal
by the private respondents (heirs), the decision of the
lower court was reversed. Title for lots 2 and 3 were
cancelled.
- VICAR filed with the Supreme Court a petition for review
on certiorari of the decision of the Court of Appeals
dismissing his application for registration of Lots 2 and 3.
- During trial, the Heirs of Octaviano presented one (1)
witness, who testified on the alleged ownership of the
land in question (Lot 3) by their predecessor-in-interest,
Egmidio Octaviano; his written demand to Vicar for the
return of the land to them; and the reasonable rentals for
the use of the land at P10,000 per month. On the other
hand, Vicar presented the Register of Deeds for the
Province of Benguet, Atty. Sison, who testified that the
land in question is not covered by any title in the name of
Egmidio Octaviano or any of the heirs. Vicar dispensed
with the testimony of Mons. Brasseur when the heirs
admitted that the witness if called to the witness stand,
would testify that Vicar has been in possession of Lot 3,
for 75 years continuously and peacefully and has
constructed permanent structures thereon.
Issue: WON Vicar had been in possession of lots 2 and 3
merely as bailee borrower in commodatum, a gratuitous
loan for use.
Held: YES.
Private respondents were able to prove that their
predecessors' house was borrowed by petitioner Vicar
after the church and the convent were destroyed. They
never asked for the return of the house, but when they
allowed its free use, they became bailors in commodatum
and the petitioner the bailee.
The bailees' failure to return the subject matter of
commodatum to the bailor did not mean adverse
possession on the part of the borrower. The bailee held in
trust the property subject matter of commodatum. The
adverse claim of petitioner came only in 1951 when it
declared the lots for taxation purposes. The action of
petitioner Vicar by such adverse claim could not ripen
into title by way of ordinary acquisitive prescription
because of the absence of just title.
The Court of Appeals found that petitioner Vicar
did not meet the requirement of 30 years
possession for acquisitive prescription over Lots 2
and 3. Neither did it satisfy the requirement of 10
years possession for ordinary acquisitive
prescription because of the absence of just title.
The appellate court did not believe the findings of
the trial court that Lot 2 was acquired from Juan
Valdez by purchase and Lot 3 was acquired also
by purchase from Egmidio Octaviano by petitioner
Vicar because there was absolutely no
documentary evidence to support the same and
the alleged purchases were never mentioned in
the application for registration.
13. Pajuyo v. CA, G.R. No. 146364, June 3, 2004
Pajuyo purchased the rights over a property from Pedro
Perez. Thereafter, he constructed a house and he and
his family lived there. Later, Pajuyo agreed to let
Guevarra live in the house for free provided that
Guevarra maintain cleanliness and orderliness of the
house. They also agreed that Guevarra should leave
upon demand. But when Pajuyo later told Guevarra that
he needed the house, Guevarra refused, hence an
ejectment case was filed.
Supreme Court held that the contract is not a
commodatum. In a contract of commodatum, one of the
parties delivers to another something not consumable so
that the latter may use the same for a certain time and
return it. An essential feature of commodatum is that it is
gratuitous. Another feature of commodatum is that the
use of the thing belonging to another is for a certain
period. Thus, the bailor cannot demand the return of the
thing loaned until after expiration of the period stipulated,
or after accomplishment of the use for which the
commodatum is constituted. If the bailor should have
urgent need of the thing, he may demand its return for
temporary use. If the use of the thing is merely tolerated
by the bailor, he can demand the return of the thing at
will, in which case the contractual relation is called a
precarium. Under the Civil Code, precarium is a kind of
commodatum.
14.REPUBLIC VS BAGTAS
Facts: Bagtas borrowed three bulls from the Bureau of
Animal Industry for one year for breeding purposes
subject to payment of breeding fee of 10% of book value
of the bull. Upon expiration, Bagtas asked for renewal.
The renewal was granted only to one bull. Bagtas offered
to buy the bulls at its book value less depreciation but the
Bureau refused. The Bureau said that Bagtas should
either return or buy it at book value. Bagtas proved that
he already returned two of the bulls, and the other bull
died during a Huk raid, hence, obligation already
extinguished. He claims that the contract is a
commodatum hence, loss through fortuitous event should
be borne by the owner.
Issue: WON Bagtas is liable for the death of the bull.
Held: Yes. Commodatum is essentially gratuitous.
However, in this case, there is a 10% charge. If this is
considered compensation, then the case at bar is a
lease. Lessee is liable as possessor in bad faith because
the period already lapsed.
Even if this is a commodatum, Bagtas is still liable
because the fortuitous event happened when he held the
bull and the period stipulated already expired and he is
liable because the thing loaned was delivered with
appraisal of value and there was no contrary stipulation
regarding his liability in case there is a fortuitous event.
15. PEOPLE VS PUIG
16. CEBU INTERNATIONAL FINANCE
CORPORATION
The prevailing jurisprudence is that a mortgagee has a
right to rely in good faith on the certificate of title of the
mortgagor to the property given as security and in the
absence of any sign that might arouse suspicion, has no
obligation to undertake further investigation.
Facts: Jacinto Dy executed a Special Power of Attorneyin
favor of private respondent Ang Tay, authorizing the latter
to sell the cargo vessel owned by Dy and christened LCT
Asiatic. Through a Deed of Absolute Sale, Ang Tay sold
the subject vessel to Robert Ong (Ong). Ong paid the
purchase price by issuing three (3) checks However,
since the payment was not made in cash, it was
specifically stipulated in the deed of sale that the LCT
Asiatic shall not be registered or transferred to Robert
Ong until complete payment. Thereafter, Ong obtained
possession of the subject vessel so he could begin
deriving economic benefits therefrom. He, likewise,
obtained copies of the unnotarized deed of sale allegedly
to be shown to the banks to enable him to acquire a loan
to replenish his (Ongs) capital.
The aforequoted condition, however, which was
handwritten on the original deed of sale does not appear
on Ongs copies.Contrary to the aforementioned
agreements and without the knowledge of Ang Tay, Ong
had his copies of the deed of sale (on which the
aforementioned prohibition does not appear) notarized
Ong presented the notarized deed to the Philippine Coast
Guard which subsequently issued him a Certificate of
Ownership and a Certificate of Philippine Register over
the subject vessel. Ong also succeeded in having the
name of the vessel changed to LCT Orient Hope.
Using the acquired vessel, Ong acquired a loan from
Cebu International Finance Corporation to be paid in
installments as evidenced by a promissory note of even
date. As security for the loan, Ong executed a chattel
mortgage over the subject vessel, which mortgage was
registered with the Philippine Coast Guard and annotated
on the Certificate of Ownership.
-Ong defaulted in the payment of the monthly
installments. Consequently, Cebu International Finance
Corporation sent him a letter] demanding delivery of the
mortgaged vessel for foreclosure or in the alternative to
pay the balance pursuant to paragraph 11 of the deed of
chattel mortgage. Meanwhile, the two checks paid by
Ong to Ang Tay for the Purchase of the subject vessel
bounced. Ang Tays search for the elusive Ong and all
attempts to confer with him proved to be futile. A
subsequent investigation and inquiry with the Office of
the Coast Guard revealed that the subject vessel was
already in the name of Ong, in violation of the express
undertaking contained in the original deed of sale. As a
result thereof, Ang Tay and Jacinto Dy filed a civil case
for rescission and replevin with damages against Ong
and his wife.
Issue: Whether or not Cebu International Finance
Corporation can validly foreclose the chattel mortgage
Held: The prevailing jurisprudence is that a mortgagee
has a right to rely in good faith on the certificate of title of
the mortgagor to the property given as security and in the
absence of any sign that might arouse suspicion, has no
obligation to undertake further investigation. Hence, even
if the mortgagor is not the rightful owner of or does not
have a valid title to the mortgaged property, the
mortgagee or transferee in good faith is nonetheless
entitled to protection. Although this rule generally pertains
to real property, particularly registered land, it may also
be applied by analogy to personal property, in this case
specifically, since ship owners are, likewise, required by
law to register their vessels with the Philippine Coast
Guard.
The chattel mortgage constituted on a vessel by the
buyer who was able to register the vessel in his name
despite the agreement with the seller that the vessel
would not be so registered until after full payment of the
price which do not appear in the buyers copy of the
deed of sale is VALID, for the mortgagee has the right to
rely in good faith on the certificate of registration.
17. CIR VS BURGOS
Commissioner of Public Highways, petitioner, vs. Hon.
Francisco P. Burgos, in his capacity as Judge of the
Court of First Instance of Cebu City, Branch II, and Victor
Amigable, respondents.
March 31, 1980
De Castro, J:
Facts:
On 1924, the government took private respondent
Victor Amigable's land for road-right-of-way
purpose.
On 1959, Amigable filed in the Court of First Instance a
 complaint to recover the ownership and
possession of the land and for damages for the
alleged illegal occupation of the land by the
government (entitled Victor Amigable vs. Nicolas
Cuenco, in his capacity as Commissioner of Public
Highways and Republic of the Philippines).
Amigable's complaint was dismissed on the grounds
that the land was either donated or sold by its
owners to enhance its value, and that in any case,
the right of the owner to recover the value of said
property was already barred by estoppel and the
statute of limitations. Also, the non-suability of the
government was invoked.
In the hearing, the government proved that the price of
the property at the time of taking was P2.37 per
square meter. Amigable, on the other hand,
presented a newspaper showing that the price was
P6.775.
The public respondent Judge ruled in favor of Amigable
and directed the Republic of the Philippines to pay
Amigable the value of the property taken with
interest at 6% and the attorney's fees.
Ratio:
Article 1250 of the NCC provides that the value of
currency at the time of the establishment of the
obligation shall be the basis of payment which
would be the value of peso at the time of taking of
the property when the obligation of the
government to pay arises. It is only when there is
an agreement that the inflation will make the value
of currency at the time of payment, not at the time
of the establishment, the basis for payment.
The correct amount of compensation would be
P14,615.79 at P2.37 per square meter, not
P49,459.34, and the interest in the sum of
P145,410.44 at the rate of 6% from 1924 up to the
time respondent court rendered its decision as
was awarded by the said court should accordingly
be reduced.

Issue:

Whether or not the provision of Article 1250 of the New

Civil Code is applicable in determining the amount
of compensation to be paid to private respondent
Amigable for the property taken.

Held:

Not applicable.