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COURSE OUTLINE IN CIVIL LAW REVIEW 1 computation of legal periods. Lex posteriori derogat

Week 1: Arts. 1-44, NCC Both Article 13 of the Civil Code and Section 31,
Add’l Readings & Cases: Chapter VIII, Book I of the Administrative Code of 1987
deal with the same subject matter - the computation of
Sec. 31, Chapter VIII, Book 1, 1987 AdministrativeCode legal periods. Under the Civil Code, a year is equivalent
Section 31. Legal Periods. - "Year" shall be to 365 days whether it be a regular year or a leap year.
understood to be twelve calendar months; "month" of Under the Administrative Code of 1987, however, a
thirty days, unless it refers to a specific calendar month year is composed of 12 calendar months. Needless to
in which case it shall be computed according to the state, under the Administrative Code of 1987, the
number of days the specific month contains; "day," to number of days is irrelevant. We therefore hold that
a day of twenty-four hours; and "night," from sunset to respondent’s petition (filed on April 14, 2000) was filed
sunrise. on the last day of the 24th calendar month from the day
respondent filed its final adjusted return. Hence, it was
CIR vs. Primetown Property Group, Inc. 531 SCRA filed within the reglementary period.
436 (2007)G.R. No. 162155, August 28, 2007
CIR vs. Aichi Forging Company of Asia, Inc.,
Facts: 632SCRA 422 (2010)
Gilbert Yap, vice chair of respondent Primetown
Property Group, Inc., applied for the refund or credit of Topic: Article 13 of the Civil Code as Amended by the
income tax respondent paid in 1997. He claimed that Administrative Code
because explained because respondent suffered losses,
it was not liable for income taxes. Nevertheless, DOCTRINE: Article 13 of the Civil Code is deemed
respondent paid its quarterly corporate income tax and superseded by Section 31, Chapter VIII, Book I of the
remitted creditable withholding tax from real estate Administrative Code of 1987, which thus means a year
sales to the BIR in the total amount of P26,318,398.32. is equivalent to 12 calendar months.
Therefore, respondent was entitled to tax refund or tax
credit. FACTS:
Revenue officer required respondent to submit On September 30, 2004, Respondent Aichi Forging
additional documents to support its claim. Respondent Company filed a claim for refund/credit of input VAT
complied but its claim was not acted upon. It filed a for the period July 1, 2002 to September 30, 2002 in
petition for review in the CTA. However, the CTA the the total amount of P3,891,123.82 with the petitioner
petition as it was filed beyond the two-year prescriptive CIR. The refund is based on zero-rated sales made by
period for filing a judicial claim for tax refund or tax respondent, for which the NIRC allows a VAT entity
credit as provided in Sec. 229 of the NIRC. In addition, (such as Aichi) to claim a refund credit. In denying the
the tax court applied Article 13 of the Civil Code which application, petitioner argued that the claim was filed
states: beyond the 2-year prescription period provided by law.
Art. 13. When the law speaks of years, months, It posited that pursuant to Article 13 of the Civil Code,
days or nights, it shall be understood that years are since the year 2004 was a leap year (364 days instead
of three hundred sixty five days each… of 365), the filing of the claim for tax refund/credit on
September 30, 2004 was beyond the two-year period,
Thus, according to the CTA, the two-year prescriptive which expired on September 29, 2004.
period under Section 229 of the NIRC for the filing of
judicial claims was equivalent to 730 days. Because the ISSUE:
year 2000 was a leap year, respondent’s petition, which Whether or not the claim for refund was filed beyond
was filed 731 days after respondent filed its final the 2-year prescriptive period or not
adjusted return, was filed beyond the reglementary
period. Respondent moved for reconsideration but it HELD:
was denied. Hence, it filed an appeal in the CA and the YES, because the claim prescribed in September 30,
CA reversed the decision of the CTA. Petitioners moved 2004 and not September 29, 2004. The Court
for reconsideration but it was denied. Thus, this explained that both Article 13 of the Civil Code and
appeal. Section 31, Chapter VIII, Book I of the Administrative
Code of 1987 deal with the same subject matter – the
Issue: computation of legal periods. Under the Civil Code, a
Whether or not Art. 13 of the Civil Code should be year is equivalent to 365 days whether it be a regular
applicable in computing the legal periods or Sec. 31 of year or a leap year. Under the Administrative Code of
the Administrative Code of 1987. 1987, however, a year is composed of 12 calendar
months. In the Administrative Code of 1987, the
Ruling: number of days is irrelevant. The Court further
E.O. 292 should be applied in computing the legal clarified that in this apparent inconsistency, the
period being the more recent law, governs the Administrative Code must prevail, being the more
recent law, governs the computation of legal periods.
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offended part and because 2004 (?) was a leap year, the
(The claim for refund was still denied. Respondent did total number of days is not 365 days. Hence, the
not observe the NIRC requirement of filing a judicial dismissal became permanent on June 8, 2004.
appeal after 120 days from CIR decision or failure to
render a decision. Hence, aside from the 2-year ISSUE:
prescriptive period, the 120-day administrative appeal Whether or not the total of number of days in a leap
period must also be observed. Not relevant to our year should be used in computing the 1-year period for
topic.) the provisional dismissal to be considered permanent

Co vs. New Prosperity Plastic Products, 727 HELD:

SCRA503 (2014) NO. The fact that year 2004 was a leap year is
inconsequential to determine the timeliness of Uy’s
Topic: Article 13 of the Civil Code as Amended by the motion to revive the criminal cases. Granting for the
Administrative Code sake of argument that this Court should take into
account 2004 as a leap year and that the one-year
DOCTRINE: Article 13 of the Civil Code is deemed period to revive the case should be reckoned from the
superseded by Section 31, Chapter VIII, Book I of the date of receipt of the order of provisional dismissal by
Administrative Code of 1987, which thus means a year Uy, the Court still held that the motion to revive the
is equivalent to 12 calendar months. criminal cases against Co was timely filed. A year is
equivalent to 365 days regardless of whether it is a
FACTS: regular year or a leap year.3 Equally so, under the
Respondent New Prosperity Plastic Products, Administrative Code of 1987, a year is composed of 12
represented by Elizabeth Uy filed a case against calendar months. The number of days is irrelevant.
petitioner for the violation of B.P. 22. In the absence of
Uy and the private counsel, the cases were Lavadia vs. Heirs of Juan Luces Luna, 730 SCRA
provisionally dismissed on June 9, 2003 in open court 376(2014).
pursuant to Section 8, Rule 117 of the Revised Rules of
Criminal Procedure.Uy received a copy of the June9, TOPIC: Nationality Principle
2003 Order on July 2, DOCTRINE:
2003, while her counsel-of-record received a copy a Divorce between Filipinos is void and ineffectual under
day after.On July 2, 2004, Uy, through counsel, filed a the nationality rule adopted by Philippine law. Hence,
Motion to Revive the Criminal Cases.The motion was any settlement of property between the parties of the
granted. After the case was reraffled (judge inhibited), first marriage involving Filipinos submitted as an
Co then filed a petition for certiorari and prohibition incident of a divorce obtained in a foreign country lacks
with prayer for the issuance of a temporary restraining competent judicial approval, and cannot be
order (TRO)/writ of preliminary injunction (WPI) enforceable against the assets of the husband who
before the RTC of Caloocan City challenging the revival contracts a subsequent marriage.
of the criminal cases.
It was dismissed. MR and petition for reviewer on Atty. Luna, a lawyer in a big law firm, married Eugenia
certiorari under rule 45 was likewise dismissed. on September 10, 1947. They begot 7 children. After
However, before the cases were reraffled, a Motion for almost 2 decades of marriage, ATTY. LUNA and
Permanent Dismissal was filed by Co. Uy opposed the EUGENIA eventually agreed to live apart from each
Motion. The new judge granted the Motion. After Uy’s other in February 1966 and agreed to separation of
MR was denied, she filed a Petition for Certiorari. The property, to which end, they entered into a written
petition was filed. Thus, the RTC ordered that the agreement entitled "AGREEMENT FOR SEPARATION
proceeding in the lower court proceed. Co filed a AND PROPERTY SETTLEMENT" whereby they
Petition for Certiorari with the CA. The CA dismissed agreed to live separately and to dissolve and liquidate
the petition. Hence, this petition for reviewer on their conjugal partnership of property. ATTY. LUNA
certiorari under Rule 45 with TPO/WPI. likewise obtained a divorce decree in Dominican
Republic. On the same date, ATTY LUNA married
DOCTRINE: Divorce between Filipinos is void and Soledad. They bought a condo unit in Makati which
ineffectual under the nationality rule adopted by they paid through installments. Upon full payment, the
Philippine law. Hence, any settlement of property CCT was issued in their name as husband and wife. Atty
between the parties of the first marriage involving Juan died. His son Gregorio took over his law books,
Filipinos submitted as an incident of a divorce obtained furniture and equipment found inside the condo unit.
in a foreign country lacks competent judicial approval, This prompted Soledad to file a case against the heirs
and cannot be enforceable against the assets of the of Atty Luna arguing that the properties in question
husband who contracts a subsequent marriage. was obtained during the existence of their marriage.
The RTC ruled in favor of the heirs thereby ordering the
Co claims that assuming that the dismissal on June 9, RD to change the CCT in favor of Eugenia - from
2003 was provisional, it became permanent after 1 year "JUAN LUCES LUNA married to Soledad L. Luna" to
from its issuance (June 9) and not upon notice to
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"JUAN LUCES LUNA married to Eugenia Zaballero Dismiss and subsequent MR was denied by the RTC,
Luna". The CA affirmed the RTC’s decision. which thus forced Vicente to file a petition on certiorari
to the CA. The CA ruled in favor of Vicente, reversing
ISSUE: the RTC’s decision stating that Rebecca no longer had
Whether or not the Court should recognize should the right to have her marriage declared void as she
recognize the divorce decree from Dominican already obtained a divorce decree as an American
Republic. citizen. It must be noted that Rebecca was eventually
recognized as Filipino citizen as evidenced by her
HELD: No, because the Nationality Rule applies in the Philippine passport and ID Certificate issued by the
case at bar. Our Family Code does not recognize Bureau of Immigration.
divorce. The only two types of defective marital unions
under our laws have been the void and the voidable ISSUE:
marriages. As such, the remedies against such defective Whether or not the divorce decree obtained by an alien
marriages have been limited to the declaration of spouse can be recognized in the Philippines.
nullity of the marriage and the annulment of the
marriage. The non-recognition of absolute divorce in HELD:
the Philippines is a manifestation of the respect for the Yes, a foreign divorce can be recognized here, provided
sanctity of the marital union especially among Filipino the divorce decree is proven as a fact and as valid under
citizens. It affirms that the extinguishment of a valid the national law of the alien spouse. When the divorce
marriage must be grounded only upon the death of was granted, Rebecca was yet to be recognized as a
either spouse, or upon a ground expressly provided Filipino citizen. As an American citizen whose national
bylaw. For as long as this public policy on marriage law recognizes divorce, she obtained the divorce
between Filipinos exists, no divorce decree dissolving decree. The Supreme Court emphasized the existence
the marriage between them can ever be given legal or of the divorce decree has not been denied, but in fact
judicial recognition and enforcement in this admitted by both parties. And neither did they impeach
jurisdiction. (The Court further ruled on the issue of the jurisdiction of the divorce court nor challenge the
the validity of the Agreement for Separation and validity of its proceedings on the ground of collusion,
Property Settlement and the property relations during fraud, or clear mistake of fact or law, albeit both
the cohabitation of Soledad and Atty Luna. But as this appeared to have the opportunity to do so. The same
case was assigned under Articles 1 to 44 of the Civil holds true with respect to the decree of partition of
Code, I did not include such ruling in this digest.) their conjugal property. The two elements in Article 26
were present in the case, and thus, there is no reason to
Bayot vs. Court of Appeals, 570 SCRA 472 (2008). not recognize the divorce decree.

TOPIC: Nationality Principle; Decree of divorce Orion Savings Bank vs. Suzuki, 740 SCRA 345
obtained abroad (2014)

DOCTRINE: An absolute divorce secured by an Fact

American married to a Filipino can be recognized in the Respondent Shigekane Suzuki, a Japanese national,
Philippines despite the former’s eventual recognition met with Ms. Helen Soneja to inquire about a
as a Filipino citizen. condominium unit and a parking slot at Cityland
P!ioneer, Mandaluyong City, allegedly owned by Yung
FACTS: Sam Kang, a Korean national.
Rebecca (an American citizen born in Guam) and
Vicente were married on April 20, 1979. After having Soneja informed Suzuki that Unit No. 536 {covered by
their only child Alix, Rebecca initiated divorce Condominium Certificate of Title (CCT) No. 18186}
proceeding in Dominican Republic. The Dominican and Parking Slot No. 42 {covered by CCT No.9118}
Court ordered the dissolution of their marriage. After a were for sale. Soneja likewise assured Suzuki that the
year, the same Dominican Court issued a decree titles to the unit and the parking slot were clean.
settling their property relations pursuant to an
Agreement they executed. Within less than a month After payment of the price of the unit and parking slot,
from the issuance of the divorce decree, Rebecca filed a Kang then executed a Deed of Absolute Sale. Suzuki
petition for the declaration of nullity of marriage. The took possession of the condominium unit and parking
petition was however later withdrawn with the lot, and commenced the renovation of the interior of
approval of the court. Rebecca then executed an the condominium unit.
Affidavit declaring that she is an American citizen, that
she and Vicente had been living separately, and that Kang thereafter made several representations with
she is carrying a child not of Vicente. She then filed a Suzuki to deliver the titles to the properties, which were
petition for the declaration of absolute nullity of then allegedly in possession of Alexander Perez (Perez,
marriage on the ground of Vicente’s psychological Orion’s Loan Officer) for safekeeping. Despite several
incapacity. Aside from such petition, Vicente and verbal demands, Kang failed to deliver the documents.
Rebecca filed various criminal cases against each other
(bigamy, perjury, concubinage). Vicente’s Motion to
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Suzuki later on learned that Kang had left the country, properties as they are registered in his name alone, and
prompting Suzuki to verify the status of the properties. that he is married to Hyun Sook Jung. There is no
He learned that CCT No. 9118 representing the title to reason to declare as invalid Kang’s conveyance in favor
the Parking Slot No. 42 contained no annotations of Suzuki for the supposed lack of spousal consent.
although it remained under the name of Cityland
Pioneer.Despite the cancellation o$ the mortgage to It is undisputed that notwithstanding the supposed
Orion, the titles to the properties remained in execution of the Dacion en Pago on February 2, 2003,
possession of Perez. Kang remained in possession of the condominium unit.
In fact, nothing in the records shows that Orion even
Suzuki then demanded the delivery of the titles. Orion, bothered to take possession of the property even six (6)
through Perez, however, refused to surrender the titles, months after the supposd date of execution of the
and cited the need to consult Orion’s legal counsel as Dacion en Pago. Kang was even able to transfer
its reason. possession of the condominium unit to Suzuki, wh then
made immediate improvements thereon.
Whether or not Korean Law should be applied in Del Soccoro vs. Van Wilsem, 744 SCRA 516 (2014)
conveying the conjugal property of spouses Kang?
In the present case, the Korean law should not be PHILIPPINE LAW
applied. It is a universal principle that real or
immovable property is exclusively subject to the laws Facts:
of the country or state where it is located.xxxx (A)ll Petitioner Norma and respondent Ernst Johan
matters concerning the title and disposition of real contracted marriage in Holland. They were blessed
property are determined by what is known as the lex with a son named Roderigo, who at the time of the
loci rei sitae, which can alone prescribe the mode by filing of the instant petition was sixteen (16) years of
which a title can pass from one person to another, or by age.
which an interest therein can be gained or lost. Unfortunately, their marriage bond ended by virtue of
On the other hand, property relations between spouses a Divorce Decree issued by the appropriate Court of
are governed principally by the national law of the Holland. At that time, their son was only eighteen (18)
spouses. However, the party invoking the application months old. Thereafter, petitioner and her son came
of a foreign law has the burden of proving the foreign home to the Philippines.
law. According to petitioner, respondent made a promise to
The foreign law is a question of fact to be properly provide monthly support to their son in the amount of
pleaded and proved as the judge cannot take judicial Two Hundred Fifty (250) Guildene (which is
notice of a foreign law. He is presumed to know only equivalent to Php17,500.00 more or less). However,
domestic or the law of the forum. since the arrival of petitioner and her son in the
Philippines, respondent never gave support to the son,
To prove a foreign law, the party invoking it must Roderigo.
present a copy thereof and comply with Sections 24 and Not long thereafter, respondent came to the
25 of Rule 132 of the Revised Rules of Court. Philippines and remarried in Cebu City, and since then,
have been residing thereat. Petitioner, through her
In the present case, Orion, unfortunately failed to counsel, sent a letter demanding for support from
prove the South Korean law on the conjugal ownership respondent. However, respondent refused to receive
of property. It merely attached a "Certification from the the letter.
Embassy of the Republic of Korea" to prove the Because of the foregoing circumstances, petitioner
existence of Korean Law. This certification, does not filed a complaint affidavit with the Provincial
qualify as sufficient proof of the conjugal nature of the Prosecutor of Cebu City against respondent for
property for there is no showing that it was properly violation of Section 5, paragraph E(2) of R.A. No. 9262
authenticated by the seal of his office, as required for the latter’s unjust refusal to support his minor child
under Section 24 of Rule 132. with petitioner. Thereafter, the Provincial Prosecutor
of Cebu City issued a Resolution recommending the
Accordingly, the International Law doctrine of filing of an information for the crime charged against
presumed-identity approach or processual herein respondent with the RTC-Cebu.
presumption comes into play, i.e., where a foreign law The RTC-Cebu issued the herein assailed Order,
is not pleaded or, even if pleaded, is not proven, the dismissing the instant criminal case against
presumption is that foreign law is the same as respondent on the ground that the facts charged in the
Philippine Law. information do not constitute an offense with respect
to the respondent who is an alien,
Under the Philippine law, the phrase Yung Sam Kang Thereafter, petitioner filed her Motion for
married to Hyun Sook Jung is merely descriptive of of Reconsideration thereto reiterating respondent’s
civil status of Kang. In other words, the import from the obligation to support their child under Article 195 of
certificates of title is that Kang is the owner of the the Family Code, thus, failure to do so makes him liable
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under R.A. No. 9262 which "equally applies to all child to be denied of financial support when the latter
persons in the Philippines who are obliged to support is entitled thereto.
their minor children regardless of the obligor’s
nationality." Land Bank of the Philippines vs. Ong, 636 SCRA
The RTC-Cebu issued an Order denying petitioner’s 266(2010).
Motion for Reconsideration. Hence, the present
Petition for Review on Certiorari. TOPIC: Unjust enrichment; Accion in rem verso

ISSUE: DOCTRINE: The principle of unjust enrichment

Does a foreign national have an obligation to support essentially contemplates payment when there is no
his minor child under our Philippine Law? duty to pay, and the person who receives the payment
has no right to receive it.
A foreign national has an obligation to support his FACTS:
minor child. Petitioner cannot rely on Article 195 of the Spouses Johnson and Evangeline Sy secured a loan
New Civil Code in demanding support from from LBP Legazpi City in the amount of P16 million.
respondent, who is a foreign citizen, since Article 15 of They failed to pay the loan. They executed a Deed of
the New Civil Code stresses the principle of nationality. Sale with Assumption of Mortgage in favor of
In other words, insofar as Philippine laws are Evangeline’s mother. Evangeline’s father, petitioner
concerned, specifically the provisions of the Family Alfredo Ong, later went to Land Bank to inform it about
Code on support, the same only applies to Filipino the sale and assumption of mortgage. Alfredo was told
citizens. By analogy, the same principle applies to that there was nothing wrong with the agreement with
foreigners such that they are governed by their national the Spouses Sy but he was provided with requirements
law with respect to family rights and duties. for the assumption of mortgage. He was also told that
The obligation to give support to a child is a matter that Alfredo should pay part of the principal which was
falls under family rights and duties. Since the computed at P750,000 and to update due or accrued
respondent is a citizen of Holland or the Netherlands interests on the promissory notes so that LBP could
he is subject to the laws of his country, not to Philippine easily approve the assumption of mortgage. Alfredo
law, as to whether he is obliged to give support to his then issued a check for P750,000 and personally gave
child, as well as the consequences of his failure to do so. it to Atty. Hingco (Branch Head). A receipt was issued
It cannot be gainsaid, therefore, that the respondent is for his payment. He also submitted the other
not obliged to support petitioner’s son under Article documents required by Land Bank, such as financial
195 of the Family Code as a consequence of the Divorce statements for 1994 and 1995. Atty. Hingco then
Covenant obtained in Holland. This does not, however, informed Alfredo that the certificate of title of the
mean that respondent is not obliged to support Spouses Sy would be transferred in his name but this
petitioner’s son altogether. never materialized. No notice of transfer was sent to
In international law, the party who wants to have a him.Alfredo later found out that his application for
foreign law applied to a dispute or case has the burden assumption of mortgage was not approved by Land
of proving the foreign law. In the present case, Bank because of a credit investigation about them. LBP
respondent hastily concludes that being a national of then foreclosed the mortgage. Alfredo only learned of
the Netherlands, he is governed by such laws on the the foreclosure when he saw the subject mortgage
matter of provision of and capacity to support. While properties included in a Notice of Foreclosure of
respondent pleaded the laws of the Netherlands in Mortgage and Auction Sale. He was
advancing his position that he is not obliged to support promised that the P750,000 would be returned to
his son, he never proved the same. them. As it was not returned, Alfredo initiated an
It is incumbent upon respondent to plead and prove action for recovery of sum of money with damages
that the national law of the Netherlands does not against LBP claiming that he was lured into believing
impose upon the parents the obligation to support their that his payment of P750,000 would cause Land Bank
child (either before, during or after the issuance of a to approve his assumption of the loan of the Spouses Sy
divorce decree). In view of respondent’s failure to prove and the transfer of the mortgaged properties in his and
the national law of the Netherlands in his favor, the his wife’s name. In ruling in favor of the respondent,
doctrine of processual presumption shall govern. the RTC explained that although the Assumption of
Under this doctrine, if the foreign law involved is not Mortgage was not perfected, under the principle of
properly pleaded and proved, our courts will presume equity and justice, the bank should return the amount
that the foreign law is the same as our local or domestic Alfredo had paid with interest at 12% per annum
or internal law. Thus, since the law of the Netherlands computed from the filing of the complaint. The CA
as regards the obligation to support has not been affirmed the decision.
properly pleaded and proved in the instant case, it is
presumed to be the same with Philippine law, which ISSUE: Whether or not the denial of the assumption
enforces the obligation of parents to support their of mortgage amounted to unjust enrichment.
children and penalizing the non-compliance therewith.
Such obligation is still duly enforceable in the HELD:
Philippines because it would be of great injustice to the
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Yes, Land Bank is still liable for the return of the of PHILAB, promised to submit the contract for the
P750,000 based on the principle of unjust enrichment. installation of lab furniture to BIOTECH by January 12,
Land Bank is correct in arguing that it has no obligation 1983. PHILAB failed to do so. In response to repeated
as creditor to recognize Alfredo as a person with requests for a sample contract, PHILAB just sent
interest in the fulfillment of the obligation. But while accomplishment reports and asked for payment, to
Land Bank is not bound to accept the substitution of which FEMF obliged. For the last installment payment,
debtors in the subject real estate mortgage, it is FEMF failed to remit the required sum of money
estopped by its action of accepting Alfredo’s payment despite repeated demands from PHILAB. FEMF never
from arguing that it does not have to recognize Alfredo responded to the demands of PHILAB. As one of its
as the new debtor. By accepting Alfredo’s payment and remedies, PHILAB sought payment from BIOTECH,
keeping silent on the status of Alfredo’s application, even if the same was to be paid in installment basis. As
Land Bank misled Alfredo to believe that he had for all its final recourse, PHILAB filed a complaint for sum of
intents and purposes stepped into the shoes of the money and damages against UP. In its answer, UP
Spouses Sy. Unjust enrichment exists when a person denied liability and alleged that PHILAB had no cause
unjustly retains a benefit to the loss of another, or when of action against it because it was merely the
a person retains money or property of another against donee/beneficiary of the laboratory furniture in the
the fundamental principles of justice, equity and good BIOTECH; and that the FEMF, which funded the
conscience. Additionally, unjust enrichment has been project, was liable to the PHILAB for the purchase price
applied to actions called accion in rem verso. In order of the laboratory furniture.
that the accion in rem verso may prosper, the following
conditions must concur: (1) that the defendant has UP specifically denied obliging itself to pay for the
been enriched; (2) that the plaintiff has suffered a loss; laboratory furniture supplied by PHILAB.
(3) that the enrichment of the defendant is without just
or legal ground; and (4) that the plaintiff has no other The CA ruled that UP is liable under the doctrine of
action based on contract, quasi-contract, crime, or unjust enrichment.
UP vs. Philab Industries, Inc., G.R. No. 152411, 1. Whether or not UP is liable to pay for the unpaid
Sep.29, 2004. balance
2. Whether or not the CA erred in basing its judgment
Doctrine: Unjust Enrichment on the doctrine of unjust enrichment
In 1979, UP decided to construct an integrated system Held:
of research organization known as the Research 1. No. The Supreme Court explained that a contract
Complex. As part of the project, laboratory equipment implied in fact is one implied from facts and
and furniture were purchased for the National Institute circumstances showing a mutual intention to
of Biotechnology and Applied Microbiology contract. It arises where the intention of the parties
(BIOTECH) at the UP Los Banos Providentially, the is not expressed, but an agreement in fact creating an
Ferdinand E. Marcos Foundation (FEMF) came obligation. It is a contract, the existence and terms of
forward and agreed to fund the acquisition of the which are manifested by conduct and not by direct or
laboratory furniture, including the fabrication thereof. explicit words between parties but is to be deduced
Dr. William Padolina, the Executive Deputy Director of from conduct of the parties, language used, or things
BIOTECH, arranged for Philippine Laboratory done by them, or other pertinent circumstances
Industries, Inc. (PHILAB), to fabricate the laboratory attending the transaction. To create contracts
furniture and deliver the same to BIOTECHÂ for the implied in fact, circumstances must warrant inference
BIOTECH Building Project, to be paid by FEMF. that one expected compensation and the other to pay.
Padolina assured Lirio, Executive Assistant of FEMF, An implied-in-fact contract requires the parties†™
that the contract would be prepared as soon as intent to enter into a contract; it is a true contract. The
possible before the issuance of the purchase orders conduct of the parties is to be viewed as a reasonable
and the downpayment for the goods, and would be man would view it, to determine the existence or not of
transmitted to the FEMF as soon as possible. Despite an implied-in-fact contract. The totality of the
the absence of any sample contracts, PHILAB made acts/conducts of the parties must be considered to
partial deliveries of office and laboratory furniture to determine their intention. An implied-in-fact
BIOTECH after having been duly inspected by their contract will not arise unless the meeting of minds is
representatives and FEMF Executive Assistant Lirio. indicated by some intelligent conduct, act or sign. In
Moreover, in 1982, FEMF proceeded to remit various this case, PHILAB was aware, from the time Padolina
sums of money to PHILAB as part of the contacted it for the fabrication and supply of the
downpayment, for which the latter issued official laboratory furniture until the go-signal was given to it
receipts. Later in the year 1982, a Memorandum of to fabricate and deliver the furniture to BIOTECH as
Agreement between FEMF and UP was executed which beneficiary that the FEMF was to pay for the same.
affirms FEMF’s obligation to grant financial support PHILAB knew that UP was merely the donee-
and donate sums of money to the Research Complex as beneficiary of the laboratory furniture and not the
may be necessary. A year later, Navasero, the President buyer; nor was it liable for the payment of the purchase
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price thereof. From the inception, the FEMF paid for bushing, stabilizer bushing, shock absorber bushing,
the bills and statement of accounts of the respondent, center bearing cushions, among others. [Petitioner’s]
for which the latter unconditionally issued receipts to manufacture of the same automotive parts with plastic
and under the name of the FEMF. material was taken from respondent’s idea of using
plastic for automotive parts. Also, [petitioner]
2. Yes. The Supreme Court rejected the ruling of the CA deliberately copied [respondent’s] products all of
based on unjust enrichment. In order that accion in which acts constitute unfair competition, is and are
rem verso (action based on unjust enrichment) may contrary to law, morals, good customs and public
prosper, the essential elements must be present: (1) policy and have caused [respondent] damages in terms
that the defendant has been enriched, (2) that the of lost and unrealized profits in the amount of
plaintiff has suffered a loss, (3) that the enrichment of 2,000,000 as of the date of respondent’s complaint.
the defendant is without just or legal ground, and (4)
that the plaintiff has no other action based on contract, Issue:
quasi-contract, crime or quasi-delict. The essential 1. Whether or not there is unfair competition under
requisites for the application of Article 22 of the New human relations when the parties are not competitors
Civil Code do not obtain in this case. The respondent and there is actually no damage on the part of
had a remedy against the FEMF via an action based on Jesichris?
an implied-in-fact contract with the FEMF for the 2. Consequently, if there is no unfair competition,
payment of its claim. The petitioner legally acquired should there be moral damages and attorney’s fees?
the laboratory furniture under the MOA with FEMF;
hence, it is entitled to keep the laboratory furniture. Held:
Article 28 of the Civil Code provides that "unfair
Willaware Products Corporation vs. Jesichris competition in agricultural, commercial or industrial
Manufacturing Corp., 734 SCRA 238 (2014). enterprises or in labor through the use of force,
intimidation, deceit, machination or any other unjust,
Doctrine: The Concept Of Unfair Competition Under oppressive or high-handed method shall give rise to a
Article 28 Of The Civil Code right of action by the person who thereby suffers
Facts: damage."
Jesichris Manufacturing Company the respondent filed
this present complaint for damages for unfair From the foregoing, it is clear that what is being sought
competition with prayer for permanent injunction to to be prevented is not competition per se but the use of
enjoin Willaware Products Corporation the petitioner unjust, oppressive or high handed methods which may
from manufacturing and distributing plastic-made deprive others of a fair chance to engage in business or
automotive parts similar to Jesichris Manufacturing to earn a living. Plainly,what the law prohibits is unfair
Company. The respondent, alleged that it is a duly competition and not competition where the means use
registered partnership engaged in the manufacture and dare fair and legitimate.
distribution of plastic and metal products, with
principal office at No. 100 Mithi Street, Sampalukan, Vinzons-Chato vs. Fortune Tobacco Corp., 575
Caloocan City. Since its registration in 1992, Jesichris SCRA 23 (2008)
Manufacturing Company has been manufacturing in
its Caloocan plant and distributing throughout the FACTS:
Philippines plastic-made automotive parts. Willaware
Products Corporation, on the other hand, which is This is a case for damages under Article 32 of the Civil
engaged in the manufacture and distribution of Code filed by Fortune against Liwayway as CIR.
kitchenware items made of plastic and metal has its
office near that of the Jesichris Manufacturing On June 10, 1993, the legislature enacted RA 7654,
Company. Respondent further alleged that in view of which provided that locally manufactured cigarettes
the physical proximity of petitioner’s office to which are currently classified and taxed at 55% shall be
respondent’s office, and in view of the fact that some of charged an ad valorem tax of “55% provided that the
the respondent’s employees had transferred to maximum tax shall not be less than Five Pesos per
petitioner, petitioner had developed familiarity with pack.” Prior to effectivity of RA 7654, Liwayway issued
respondent’s products, especially its plastic-made a rule, reclassifying “Champion,” “Hope,” and “More”
automotive parts. (all manufactured by Fortune) as locally manufactured
That sometime in November 2000, [respondent] cigarettes bearing foreign brand subject to the 55% ad
discovered that [petitioner] had been manufacturing valorem tax. Thus, when RA 7654 was passed, these
and distributing the same automotive parts with cigarette brands were already covered.
exactly similar design, same material and colors but
was selling these products at a lower price as In a case filed against Liwayway with the RTC, Fortune
[respondent’s] plastic-made automotive parts and to contended that the issuance of the rule violated its
the same customers. constitutional right against deprivation of property
Respondent alleged that it had originated the use of without due process of law and the right to equal
plastic in place of rubber in the manufacture of protection of the laws.
automotive under chassis parts such as spring eye
Page 8 of 8

For her part, Liwayway contended in her motion to On appeal, Continental Steel insisted that Hortillano is
dismiss that respondent has no cause of action against not entitled because under the CBA, death benefits are
her because she issued RMC 37-93 in the performance awarded if an employee’s legitimate dependent has
of her official function and within the scope of her died; but that in this case, no “death” has occurred
authority. She claimed that she acted merely as an because the fetus died inside the womb of the mother,
agent of the Republic and therefore the latter is the one that a fetus has no juridical personality because it was
responsible for her acts. She also contended that the never born pursuant to Article 40 of the Civil Code
complaint states no cause of action for lack of which provides a conceived child acquires personality
allegation of malice or bad faith. only when it is born; that the fetus was not born hence
it is not a legitimate dependent as contemplated by the
The order denying the motion to dismiss was elevated CBA nor did it suffer death as contemplated under civil
to the CA, who dismissed the case on the ground that laws.
under Article 32, liability may arise even if the
defendant did not act with malice or bad faith. Hence ISSUES:
this appeal. 1. Whether or not the fetus is a legitimate dependent?
2. Whether or not a person has to be born before it
ISSUE: could die?
Whether or not Article 32, NCC, should be applied
instead of Sec. 38, Book I, Administrative Code HELD:
1. Yes. In the first place, the fact of marriage between
HELD: Hortillano and his wife was never put in question,
SC ruled that the decisive provision is Article 32, it hence they are presumed to be married. Second,
being a special law, which prevails over a general law children conceived or born during the marriage of the
(the Administrative Code). parents are legitimate. Hence, the unborn child (fetus)
is already a legitimate dependent the moment it was
Article 32 was patterned after the “tort” in American conceived (meeting of the sperm and egg cell).
law. A tort is a wrong, a tortious act which has been
defined as the commission or omission of an act by one, 2. No. Death is defined as “cessation of life”. Certainly,
without right, whereby another receives some injury, a child in the womb has life. There is no need to discuss
directly or indirectly, in person, property or reputation. whether or not the unborn child acquired juridical
There are cases in which it has been stated that civil personality – that is not the issue here. But
liability in tort is determined by the conduct and not by nevertheless, life should not be equated to civil
the mental state of the tortfeasor, and there are personality. Moreover, while the Civil Code expressly
circumstances under which the motive of the provides that civil personality may be extinguished by
defendant has been rendered immaterial. The reason death, it does not explicitly state that only those who
sometimes given for the rule is that otherwise, the have acquired juridical personality could die. In this
mental attitude of the alleged wrongdoer, and not the case, Hortillano’s fetus had had life inside the womb as
act itself, would determine whether the act was evidenced by the fact that it clung to life for 38 weeks
wrongful. Presence of good motive, or rather, the before the unfortunate miscarriage. Thus, death
absence of an evil motive, does not render lawful an act occurred on a dependent hence Hortillano as an
which is otherwise an invasion of another’s legal right; employee is entitled to death benefit claims as provided
that is, liability in tort in not precluded by the fact that for in their CBA.
defendant acted without evil intent.

Continental Steel Manufacturing Corp. vs.

Montaño,603 SCRA 621 (2009).

Doctrine: Civil Law – Civil Personality – When does

civil personality start – When does life begin

In January 2006, the wife of Rolando Hortillano had a

miscarriage which caused the death of their unborn
child. Hortillano, in accordance with the collective
bargaining agreement, then filed death benefits claim
from his employer, the Continental Steel
Manufacturing Corporation which denied the claim.
Eventually, the issue was submitted for arbitration and
both parties agreed to have Atty. Allan Montaño act as
the arbitrator. Montaño ruled that Hortillano is
entitled to his claims. The Court of Appeals affirmed
the decision of Montaño.