As to Perfection Cases

8/17/2019 As to Perfection Cases

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G.R. No. 178610 November

17, 2010

HONGKONG AND SHANGHAI BANKING

CORP., LTD. STAFF RTIR!NT PLAN,

Re"#reme$" Tr%&" F%$', I$(.)Petitioner,

vs.

SPO*SS BIN+NIDO AND DITHA

BRO*-A, Respondents.

D E C I S I O N

CARPIO, J.:

MTC – petitioner

RTC- petitioner

CA – respondents

Hence this petition

Te F/("&

The appeate co!rt narrated the "acts as

"oo#s$

Petitioners %eron& and 'Editha( )ro*!e+a

de"endants eo# are e/po0ees o" Hon&1on& and Shan&hai )an1in&

Corporation HS)C. The0 are aso

/e/ers o" respondent Retire/ent Pan.

'Editha( )ro*!e+a otained a car oan and

appiance oan.

%erion& #as &ranted an e/er&enc0 oan.

)oth #ere paid thro!&h a!to/atic saar0

ded!ction.

On the other hand, petitioner %eron&

appied and #as &ranted an e/er&enc0

oan in the a/o!nt o" Php23,456.66 on

7!ne 8, 9::2. These oans are paid thro!&h

a!to/atic saar0 ded!ction.

a aor disp!te arose #hich res!ted to the

ter/ination o" petitioners as e/po0ees.

)eca!se o" their dis/issa, petitioners

#ere not ae to pa0 the /onth0

a/orti+ations o" their respective oans.

Hence s!it "or recover0 a&ainst

petitioners.

Te !e"roo#"/$ Tr#/ Co%r"& R%#$3

the oans sec!red 0 their "!t!re

retire/ent ene;ts to #hich the0 are no

on&er entited are red!ced to !nsec!red

and p!re civi oi&ations. As !nsec!red

and p!re oi&ations, the oans are

i//ediate0 de/andae.

Te Re3#o$/ Tr#/ Co%r"& R%#$3

The RTC r!ed that %eron& and Editha

)ro*!e+a


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>ON the !npaid oans eca/e

p!re oi&ations d!e to the

ter/ination o" the respondents

Te Co%r"& R%#$3

The petition is /eritorio!s. >e a&ree #ith

the r!in&s o" the MeTC and the RTC.

The Pro/issor0 Notes !ni"or/0 provide$

PROMISSOR? NOTE

P@@@@@ Ma1ati, M.M. @@@@ 9:@@

OR BA=E RECEIBED, I>E @@@@@ oint0

and severa0 pro/ise to pa0 to THE HS)C

RETIREMENT P=AN hereina"ter caed theFP=ANF at its oGce in the M!nicipait0 o"

Ma1ati, Metro Mania, on or e"ore !nti

"!0 paid the s!/ o" PESOS @@@ P@@@

Phiippine C!rrenc0 #itho!t disco!nt, #ith

interest "ro/ date hereo" at the rate

o" Si per cent J per ann!/, pa0ae

/onth0.

I>E a&ree that the P=AN /a0, !pon

#ritten notice, increase the interest rate

stip!ated in this note at an0 ti/edependin& on prevaiin& conditions.

I>E here0 epress0 consent to an0

etensions or rene#as hereo" "or a portion

or #hoe o" the principa #itho!t notice to

the others, and in s!ch a case o!r

iaiit0 sha re/ain oint and severa. 1avvphi1

In case coection is /ade 0 or thro!&h

an attorne0, I>E oint0 and severa0

a&ree to pa0 ten percent 96J o" the

a/o!nt d!e on this note !t in no case

ess than P866.66 as and "or attorne0e aGr/ the ;ndin&s o" the MeTC and the

RTC that there is no date o" pa0/ent

indicated in the Pro/issor0 Notes. The RTCis correct in r!in& that since the

Pro/issor0 Notes do not contain a period,

HS)C=-SRP has the ri&ht to de/and

i//ediate pa0/ent. Artice 994: o" the

Civi Code appies. The spo!ses

)ro*!e+a


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oans #i e paid on0 thro!&h saar0

ded!ctions. Neither did HS)C=-SRP a&ree

that i" Editha )ro*!e+a ceases to e an

e/po0ee o" HS)C, her oi&ation to pa0

the oans #i e s!spended. HS)C=-SRP

can i//ediate0 de/and pa0/ent o" the

oans at an0ti/e eca!se the oi&ation to

pa0 has no period. Moreover, the spo!ses

)ro*!e+a have aread0 inc!rred in de"a!t

in pa0in& the /onth0 insta/ents.

ina0, the en"orce/ent o" a oan

a&ree/ent invoves Fdetor-creditor

reations "o!nded on contract and does

not in an0 #a0 concern e/po0ee

reations. As s!ch it sho!d e en"orced

thro!&h a separate civi action in the

re&!ar co!rts and not e"ore the =aorAriter.F94

5HRFOR, #e GRANT the petition.

The Decision o" the Co!rt o" Appeas in

CA-%.R. SP No. 853 pro/!&ated on 26

March 866 is R+RSD and ST

ASID. The decision o" )ranch 92: o" the

Re&iona Tria Co!rt o" Ma1ati Cit0 in Civi

Case No. 66-454, as #e as the decision o"

)ranch 9 o" the Metropoitan Tria Co!rt

o" Ma1ati Cit0 in Civi Case No. 38L66a&ainst the spo!ses )ienvenido and

Editha )ro*!e+a, are AFFIR!D. Costs

a&ainst respondents.

SO ORDERED.

http://www.lawphil.net/judjuris/juri2010/nov2010/gr_178610_2010.html#fnt17http://www.lawphil.net/judjuris/juri2010/nov2010/gr_178610_2010.html#fnt17


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PA? BS PA=ANCA

iss!e is #hether a creditor is arred 0

prescription in his atte/pt to coect on a

pro/issor0 note eec!ted /ore than

;"teen 0ears earier #ith the detor s!ed

pro/isin& to pa0 either !pon receipt 0

hi/ o" his share "ro/ a certain estate or

!pon de/and, the asis "or the action

ein& the atter aternative.

The o#er co!rt hed that the ten-0ear

period o" i/itation o" actions did app0,

the note ein& i//ediate0 d!e and

de/andae, the creditor ad/ittin&

epress0 that he #as re0in& on the

#ordin& F!pon de/and.F.

%eor&e pa0 – creditor o" paanca #ho died

/an0 0ears a&o 0 virt!e o" a pro/issor0

note. He as1 "or etters o" ad/in in "avor

o" paancas #i"e to sette the estate and

e paid. >i"e re"!sed ae&in& that the

action o" %eor&e aread0 prescried.

Co!rt r!ed that the action has aread0

prescried.

HE=D$

it #o!d appear that petitioner #as

hope"! that the satis"action o" his credit

co!d he reai+ed either thro!&h the

detor s!ed receivin& cash pa0/ent "ro/

the estate o" the ate Caros Paanca

pres!/ptive0 as one o" the heirs, or, as

epressed therein, F!pon de/and.F There

is nothin& in the record that #o!d indicate

#hether or not the ;rst aternative #as

"!;ed. >hat is !ndeniae is that on

A!&!st 8, 9:4, /ore than ;"teen 0earsa"ter the eec!tion o" the pro/issor0 note

on 7an!ar0 26, 9:38, this petition #as

;ed. The de"ense interposed #as

prescription. Its /erit is rather ovio!s.

Artice 994: o" the Civi Code provides$

FEver0 oi&ation #hose per"or/ance does

not depend !pon a "!t!re or !ncertain

event, or !pon a past event !n1no#n to

the parties, is de/andae at once.F This

!sed to e Artice 9992 o" the Spanish

Civi Code o" 955:.

The oi&ation ein& d!e and de/andae,

it #o!d appear that the ;in& o" the s!it

a"ter ;"teen 0ears #as /!ch too ate. or

a&ain, accordin& to the Civi Code, #hich is

ased on Section L2 o" Act No. 9:6, the

prescriptive period "or a #ritten contract is

that o" ten 0ears. 7 This is another instance#here this Co!rt has consistent0 adhered to

the epress an&!a&e o" the appicae

nor/. 8 There is no necessit0 there"ore o"

passin& !pon the other e&a *!estions as to

#hether or not it did s!Gce "or the petition to

"ai !st eca!se the s!rvivin& spo!se re"!ses

to e /ade ad/inistratri, or !st eca!se the

estate #as e"t #ith no other propert0. The

decision o" the o#er co!rt cannot e

overt!rned.

>HEREORE, the o#er co!rt decision o"

7!0 8L, 9:5 is aGr/ed. Costs a&ainst

%eor&e Pa0.


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G.R. No. L1670 !/r( ,

122

S!ITH, BLL 9 CO., LTD., paintiK-

appeant,

vs.

+ICNT SOTLO !ATTI, de"endant-

appeant.

FACTS:

A contract o" sae et#een s/ith e co

and /atti invovin& the $

a 8 stee tan1s

8 epers

c 8 eectric /otors

>ith a stip!ation to deiver #ithin :6 da0s

!t not &!aranteed. The oects arrived

ate. Matti re"!sed to receive and pa0.

S/ith ;ed a case

Matti ae&ed that, as a conse*!ence o"

the paintiKs dea0 in /a1in& deiver0 o"

the &oods, #hich the intervenor intendedto !se in the /an!"act!re o" cocoan!t oi,

the intervenor s!Kered da/a&es in the

s!/s o" one h!ndred siteen tho!sand

seven h!ndred ei&ht0-three pesos and

ninet0-one centavos P99,452.:9 "or the

nondeiver0 o" the tan1s, and t#ent0-one

tho!sand t#o h!ndred and ;"t0 pesos

P89,836 on acco!nt o" the epeers and

the /otors not havin& arrived in d!e ti/e.

=o#er co!rt asoved the de"endant

inso"ar as tan1s and eec /otors #ere

concered !t ordered the/ to pa0

epeers.

ISSE$ #hether or not, !nder the contracts

entered into and the circ!/stances

estaished in the record, the paintiK has

"!;ed, in d!e ti/e, its oi&ation to rin&

the &oods in *!estion to Mania. I" it has,

then it is entited to the reie" pra0ed "or

other#ise, it /!st e hed &!it0 o" dea0

and iae "or the conse*!ences thereo".

To sove this *!estion, it is necessar0 to

deter/ine #hat period #as ;ed "or the

deiver0 o" the &oods.

As re&ards the tan1s, the contracts A and

) pa&es 9 and 8 o" the record are

si/iar, and in oth o" the/ #e ;nd this

ca!se$

To e deivered #ithin 2 or L

/onths The pro/ise or

indication o" ship/ent carries #ith

it aso!te0 no oi&ation on o!rpart %overn/ent re&!ations,

rairoad e/ar&oes, ac1 o" vesse

space, the ei&encies o" the

re*!ire/ent o" the nited States

%overn/ent, or a n!/er o"

ca!ses /a0 act to entire0 vitiate

the indication o" ship/ent as

stated. In other #ords, the order is

accepted on the asis o" ship/ent

at Mis convenience, ti/e o"

ship/ent ein& /ere0 anindication o" #hat #e hope to

acco/pish.

In the contract Ehiit C pa&e 2 o" the

record, #ith re"erence to the epeers,

the "oo#in& stip!ation appears$

The "oo#in& artices, hereineo#

/ore partic!ar0 descried, to e

shipped at San rancisco #ithin the

/onth o" Septe/er 95, or as

soon as possie. T#o Anderson

oi epeers . . . .

And in the contract reative to the /otors

Ehiit D, pa&e L, rec. the "oo#in&

appears$


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Approi/ate deiver0 #ithin ninet0

da0s. This is not &!aranteed.

This sae is s!ect to o!r ein&

ae to otain Priorit0 Certi;cate,

s!ect to the nited States

%overn/ent re*!ire/ents and aso

s!ect to con;r/ation o"

/an!"act!res.

In a these contracts, there is a ;na

ca!se as "oo#s$

The seers are not responsie "or

dea0s ca!sed 0 ;res, riots on

and or on the sea, stri1es or other

ca!ses 1no#n as Force Mae!reF

entire0 e0ond the contro o" the

seers or their representatives.

nder these stip!ations, it cannot e said

that an0 de;nite date #as ;ed "or the

deiver0 o" the &oods. As to the tan1s, the

a&ree/ent #as that the deiver0 #as to e

/ade F#ithin 2 or L /onths,F !t that

period #as s!ect to the contin&encies

re"erred to in a s!se*!ent ca!se. >ith

re&ard to the epeers, the contract sa0s

F#ithin the /onth o" Septe/er, 9:95,F

!t to this is added For as soon aspossie.F And #ith re"erence to the

/otors, the contract contains this

epression, FApproi/ate deiver0 #ithin

ninet0 da0s,F !t ri&ht a"ter this, it is

noted that Fthis is not &!aranteed.F

The ora evidence "as short o" ;in& s!ch

period.

ro/ the record it appears that these

contracts #ere eec!ted at the ti/e o" the

#ord #ar #hen there eisted ri&id

restrictions on the eport "ro/ the nited

States o" artices i1e the /achiner0 in

*!estion, and /ariti/e, as #e as

rairoad, transportation #as diGc!t, #hich

"act #as 1no#n to the parties hence

ca!ses #ere inserted in the contracts,

re&ardin& F%overn/ent re&!ations,

rairoad e/ar&oes, ac1 o" vesse space,

the ei&encies o" the re*!ire/ents o" the

nited States %overn/ent,F in connection

#ith the tan1s and FPriorit0 Certi;cate,

s!ect to the nited State %overn/ent

re*!ire/ents,F #ith respect to the /otors.

At the ti/e o" the eec!tion o" the

contracts, the parties #ere not !n/ind"!

o" the contin&enc0 o" the nited States

%overn/ent not ao#in& the eport o" the

&oods, nor o" the "act that the other

"oreseen circ!/stances therein stated

/i&ht prevent it.

Considerin& these contracts in the i&ht o"

the civi a#, #e cannot !t conc!de that

the ter/ #hich the parties atte/pted to

; is so !ncertain that one cannot te !st#hether, as a /atter o" "act, those artices

co!d e ro!&ht to Mania or not. I" that is

the case, as #e thin1 it is, the oi&ations

/!st e re&arded as conditiona.

Oi&ations "or the per"or/ance o"

#hich a da0 certain has een ;ed

sha e de/andae on0 #hen the

da0 arrives.

A da0 certain is !nderstood to eone #hich /!st necessari0 arrive,

even tho!&h its date e !n1no#n.

If the uncertainty should consist in

the arrival or non-arrival of the day,

the obligation is conditional and

shall be governed by the rules of

the next preceding

section re"errin& to p!re and

conditiona oi&ations. Art. 9983,

Civ. Code.

And as the eport o" the /achiner0 in

*!estion #as, as stated in the contract,

contin&ent !pon the seers otainin&

certi;cate o" priorit0 and per/ission o" the

nited States %overn/ent, s!ect to the

r!es and re&!ations, as #e as to rairoad

e/ar&oes, then the deiver0 #as s!ect


7/25

to a condition the "!;/ent o" #hich

depended not on0 !pon the eKort o" the

herein paintiK, !t !pon the #i o" third

persons #ho co!d in no #a0 e co/peed

to "!; the condition. In cases i1e this,

#hich are not epress0 provided "or, !t

i/pied0 covered, 0 the Civi Code, the

oi&or #i e dee/ed to have s!Gcient0

per"or/ed his part o" the oi&ation, i" he

has done a that #as in his po#er, even i"

the condition has not een "!;ed in

reait0.

CHABE BS %ONA=ES

9. CIBI= =A> CONTRACTS )REACH O CONTRACTOR NON-PERORMANCE IQIN% O PERIOD )EOREI=IN% O COMP=AINT OR NON-PERORMANCE,

ACADEMIC. >here the ti/e "or co/piance hadepired and there #as reach o" contract 0 non-per"or/ance, it #as acade/ic "or the paintiK to have;rst petitioned the co!rt to ; a period "or theper"or/ance o" the contract e"ore ;in& hisco/paint.

8. ID. ID. ID. DEENDANT CANNOT INBOE ARTIC=E99:4 O THE CIBI= CODE O THE PHI=IPPINES.>here the de"endant virt!a0 ad/itted non-per"or/ance o" the contract 0 ret!rnin& thet0pe#riter that he #as oi&ed to repair in a non-#or1in& condition, #ith essentia parts /issin&,Artice 99:4 o" the Civi Code o" the Phiippinescannot e invo1ed. The ;in& o" a period #o!d th!se a /ere "or/ait0 and #o!d serve no p!rpose than

to dea0.

2. ID. ID. ID. DAMA%ES RECOBERA)=E CASE AT)AR. >here the de"endant-appeee contravenedthe tenor o" his oi&ation eca!se he not on0 didnot repair the t0pe#riter !t ret!rned it Finsha/es, REBIE>A)=E. >here the

appeant direct0 appeas "ro/ the decision o" thetria co!rt to the S!pre/e Co!rt on *!estions o" a#,he is o!nd 0 the !d&/ent o" the co!rt a *!o on its;ndin&s o" "act.

D C I S I O N

R:S, ;.B.L., J.<

Chave+ deivered to %on+aes a t0pe#riter "or repair.%on+aes "aied to co/p0. A"ter a en&th0 dea0,chave+ de/anded "or the ret!rn o" the t0pe#riter.pon openin& the pac1a&e, it #as aread0 insha/es.

Chave+ sent a etter o" de/and. Chave+ had hist0pe#riter ;ed 0 another co/pan0.Chave+ ;ed a coection s!it a&ainst %on+aes.

=o#er co!rt on0 a#arded the va!e o" the /issin&

parts, hence this appea.

HE=D$chave+ ar&!es that $ FART. 994. I" a person oi&edto do so/ethin& "ais to do it, the sa/e sha eeec!ted at his cost.

This sa/e r!e sha e oserved i" he does it incontravention o" the tenor o" the oi&ation.!rther/ore it /a0 e decreed that #hat has eenpoor0 done he !ndone.F craa# virt!a9a# irar0

On the other hand, the position o" the de"endant-appeee, r!ct!oso %on+aes, is that he is not iaeat a, not even "or the s!/ o" P29.96, eca!se his

contract #ith paintiK-appeant did not contain aperiod, so that paintiK-appeant sho!d have ;rst;ed a petition "or the co!rt to ; the period, !nderArtice 99:4 o" the Civi Code, #ithin #hich thede"endant appeee #as to co/p0 #ith the contracte"ore said de"endant-appeee co!d e hed iae"or reach o" contract.

SC$ The ti/e "or co/piance havin& evident0epired, and there ein& a reach o" contract 0 non-per"or/ance, it #as acade/ic "or the paintiK to have;rst petitioned the co!rt to ; a period "or theper"or/ance o" the contract e"ore ;in& hisco/paint in this case. De"endant cannot invo1eArtice 99:4 o" the Civi Code "or he virt!a0ad/itted non-per"or/ance 0 ret!rnin& the

t0pe#riter that he #as oi&ed to repair in a non-#or1in& condition, #ith essentia parts /issin&. The;in& o" a period #o!d th!s e a /ere "or/ait0 and#o!d serve no p!rpose than to dea0 c". Ti&ao. Et.A. B. Mania Rairoad Co. :5 Phi. 95.

It is cear that the de"endant-appeee contravenedthe tenor o" his oi&ation eca!se he not on0 didnot repair the t0pe#riter !t ret!rned it Finsha/esF, accordin& to the appeaed decision. ors!ch contravention, as appeant contends, he isiae !nder Artice 994 o" the Civi Code. a/ *!ot,


8/25

"or the cost o" eec!tin& the oi&ation in a proper/anner. The cost o" the eec!tion o" the oi&ation inthis case sho!d e the cost o" the aor or serviceepended in the repair o" the t0pe#riter, #hich is inthe a/o!nt o" P35.43. eca!se the oi&ation orcontract #as to repair it.

In addition, the de"endant-appeee is i1e#ise iae,

!nder Artice 9946 o" the Code, "or the cost o" the/issin& parts, in the a/o!nt o" P29.96, "or in hisoi&ation to repair the t0pe#riter he #as o!nd, !t"aied or ne&ected, to ret!rn it in the sa/e conditionit #as #hen he received it.

Appeant


9/25

G.R. No. L26= O("ober =,

1=6

+ICNT SINGSON

NCARNACION, paintiK-appeee,

vs.

;ACINTA BALDO!AR, T

AL., de"endants-appeants.

HILADO, J.:

Bicente Sin&son Encarnacion, as essor o"

a ho!se in "avor o" ado/ar to a paid

/onth0.

A"ter Mania #as ierated in the ast #ar,

paintiK de/anded ado/ar to vacate on

or e"ore Apri 93, 9:L3, eca!se paintiK needed it "or his oGces as a res!t o" the

destr!ction o" the !idin& #here said

paintiK had said oGces e"ore.

Despite this de/and, de"endants insisted

on contin!in& their occ!panc0. >hen the

ori&ina action #as od&ed #ith the

M!nicipa Co!rt o" Mania on Apri 86,

9:L3, de"endants #ere in arrears in the

pa0/ent o" the renta correspondin& to

said /onth, the a&rees renta ein&pa0ae #ithin the ;rst ;ve da0s o" each

/onth. That renta #as paid prior to the

hearin& o" the case in the /!nicipa co!rt,

as a conse*!ence o" #hich said co!rt

entered !d&/ent "or restit!tion and

pa0/ent o" rentas at the rate o" P23 a

/onth "ro/ Ma0 9, 9:L3, !nti de"endants

co/pete0 vacate the pre/ises. Atho!&h

paintiK inc!ded in said ori&ina co/paint

a cai/ "or P366 da/a&es per /onth, that

cai/ #as #aived 0 hi/ e"ore the

hearin& in the /!nicipa co!rt, on acco!nt

o" #hich nothin& #as said re&ardin& said

da/a&es in the /!nicipa co!rts decision.

>hen the case reached the Co!rt o" irst

Instance o" Mania !pon appea,

de"endants ;ed therein a /otion to

dis/iss #hich #as si/iar to a /otion to

dis/iss ;ed 0 the/ in the /!nicipa

co!rt ased !pon the &ro!nd that the

/!nicipa co!rt had no !risdiction over

the s!ect /atter d!e to the a"oresaid

cai/ "or da/a&es and that, there"ore, the

Co!rt o" irst Instance had no appeate

!risdiction over the s!ect /atter o" the

action. That /otion to dis/iss #as denied

0 His Honor, 7!d&e Ma/erto Roas, 0

order dated 7!0 89, 9:L3, on the &ro!nd

that in the /!nicipa co!rt paintiK had

#aived said cai/ "or da/a&es and that,

there"ore, the sa/e #aiver #as

!nderstood aso to have een /ade in the

Co!rt o" irst Instance.la!philnet

In the Co!rt o" irst Instance the &rave/an

o" the de"ense interposed 0 de"endants,as it #as epressed de"endant =e"rado

ernando d!rin& the tria, #as that the

contract #hich the0 had ceerated #ith

paintiK since the e&innin& a!thori+ed

the/ to contin!e occ!p0in& the ho!se

inde;net0 and #hie the0 sho!d "aith"!0

"!; their oi&ations as respects the

pa0/ent o" the rentas, and that this

a&ree/ent had een rati;ed #hen

another eect/ent case et#een the

parties ;ed d!rin& the 7apanese re&i/e

concernin& the sa/e ho!se #as ae&ed0

co/po!nded in the /!nicipa co!rt. The

Co!rt o" irst Instance &ave /ore credit to

paintiKs #itness, Bicente Sin&son

Encarnacion, r., #ho testi;ed that the

ease had a#a0s and since the e&innin&

een !pon a /onth-to-/onth asis.

!rther/ore, carried to its o&ica

conc!sion, the de"ense th!s set !p 0de"endant =e"rado ernando #o!d eave

to the soe and ec!sive #i o" one o" the

contractin& parties de"endants in this

case the vaidit0 and "!;/ent o" the

contract o" ease, #ithin the /eanin& o"

artice 983 o" the Civi Code, since the

contin!ance and "!;/ent o" the contract


10/25

#o!d then depend soe0 and ec!sive0

!pon their "ree and !ncontroed choice

et#een contin!in& pa0in& the rentas or

not, co/pete0 deprivin& the o#ner o" a

sa0 in the /atter. I" this de"ense #ere to

e ao#ed, so on& as de"endants eected

to contin!e the ease 0 contin!in& the

pa0/ent o" the rentas, the o#ner #o!d

never e ae to discontin!e it

converse0, atho!&h the o#ner sho!d

desire the ease to contin!e, the essees

co!d eKective0 th#art his p!rpose i" the0

sho!d pre"er to ter/inate the contract 0

the si/pe epedient o" stoppin& pa0/ent

o" the rentas. This, o" co!rse, is prohiited

0 the a"oresaid artice o" the Civi Code.


11/25

69 7!0 8692

Eei+e&!i v. The Mania =a#n Tennis C!

Di&est %.R. No. :4

Eei+e&!i v. The Mania =a#n Tennis C!

%.R. No. :4 Ma0 9:, 9:62

acts$

A contract o" ease #as eec!ted on

7an!ar0 83, 9:56 over a piece o" and

o#ned 0 the paintiKs Eei+e&!i =essor

to the Mania =a#n Tennis C!, an En&ish

association represented 0 Mr.

>iia/son "or a ;ed consideration o"

P83 per /onth and accordin&0, to ast at

the #i o" the essee. nder the contract,

the essee can /a1e i/prove/ents

dee/ed desirae "or the co/"ort and

a/!se/ent o" its /e/ers. It appeared

that the paintiKs ter/inated the ease

ri&ht on the ;rst /onth. The de"endant is

in the eie" that there can e no other/ode o" ter/inatin& the ease than 0 its

o#n #i, as #hat the0 eieve has een

stip!ated.

As a res!t the paintiK ;ed a case "or

!na#"! detainer "or the restit!tion o" the

and cai/in& that artice 93: o" the Civi

Code provided that a essor /a0 !dicia0

dispossess the essee !pon the epiration

o" the conventiona ter/ or o" the e&a

ter/ the conventiona ter/ that is, the

one a&reed !pon 0 the parties the e&a

ter/, in de"ect o" the conventiona, ;ed

"or eases 0 artices 9344 and 9359. The

PaintiKs ar&!ed that the d!ration o" the

ease depends !pon the #i o" the essor

on the asis o" Art. 9359 #hich provides

that, F>hen the ter/ has not een ;ed

"or the ease, it is !nderstood to e "or

0ears #hen an ann!a renta has een

;ed, "or /onths #hen the rent is /onth0.

. . .F The second ca!se o" the contract

provides as "oo#s$ FThe rent o" the said

and is ;ed at 83 pesos per /onth.F

The o#er co!rt r!ed in "avor o" the

PaintiKs on the asis o" Artice 9359 o" the

Civi Code, the a# #hich #as in "orce at

the ti/e the contract #as entered into. It

is o" the opinion that the contract o" ease

#as ter/inated 0 the notice &iven 0 the

paintiK. The !d&/ent #as entered !pon

the theor0 o" the epiration o" a e&a ter/#hich does not eist, as the case re*!ires

that a ter/ e ;ed 0 the co!rts !nder

the provisions o" artice 9985 #ith respect

to oi&ations #hich, as is the present, are

ter/inae at the #i o" the oi&ee.

THE CONTRACT PROBIDES$ First. . . . The0

ease the aove-descried and to Mr.

>iia/son, #ho ta1es it on lease, . . . for

all the ti"e the /e/ers o" the said c!

/a0 desire to !se it . . . Third. . . . theo#ners o" the and !nderta1e to /aintain

the c! as tenant as long as the latter

shall see #t, !ithout altering in the

slightest degree the conditions of this

contract, even though the estate be sold.F

ISSE$ a >hether or not the parties have

a&reed !pon the d!ration o" the ease

>hether or not the ease

depends !pon the #i o" the essee

R=IN%$


12/25

a ?ES, the parties have a&reed !pon a

ter/ hence Art. 9359 is inappicae.

The e&a ter/ cannot e appied !nder

Art 9359 as it appears that there #as

act!a0 an a&ree/ent et#een the

parties as to the d!ration o" the ease,

aeit i/pied that the ease is to e

dependent !pon the #i o" the essee. It

#o!d e as!rd to accept the ar&!/ent

o" the paintiK that the contract #as

ter/inated at its notice, &iven this

i/pication.

Interestin&0, the contract sho!d not e

!nderstood as one stip!ated as a i"e

tenanc0, and sti ess as a perpet!a ease

since the ter/s o" the contract epress

nothin& to this eKect, even i" the0 i/pied

this idea. I" the ease co!d ast d!rin&

s!ch ti/e as the essee /i&ht see ;t,

eca!se it has een so stip!ated 0 the

essor, it #o!d ast, ;rst, as on& as the#i o" the essee that is, a his i"e

second, d!rin& a the ti/e that he /a0

have s!ccession, inas/!ch as he #ho

contracts does so "or hi/se" and his heirs.

Art. 9834 o" the Civi Code. The ease in

*!estion does not "a #ithin an0 o" the

cases in #hich the ri&hts and oi&ations

arisin& "ro/ a contract can not e

trans/itted to heirs, either 0 its nat!re,

0 a&ree/ent, or 0 provision o" a#.

Moreover, ein& a ease, then it /!st e

"or a deter/inate period. Art. 93L2. )0

its ver0 nat!re it /!st e te/porar0, !st

as 0 reason o" its nat!re, an e/ph0te!sis

/!st e perpet!a, or "or an !ni/ited

period. Art. 965.

) The d!ration o" the ease does not

depend soe0 !pon the #i o" the =essee

de"endant.

It cannot e conc!ded that the

ter/ination o" the contract is to e e"t

co/pete0 at the #i o" the essee si/p0

eca!se it has een stip!ated that its

d!ration is to e e"t to his #i.

The Civi Code has /ade provision "or

s!ch a case in a 1inds o" oi&ations. In

spea1in& in &enera o" oi&ations #ith a

ter/ it has s!ppied the de;cienc0 o" the"or/er a# #ith respect to the Fd!ration o"

the ter/ #hen it has een e"t to the #i

o" the detor,F and provides that in this

case the ter/ sha e ;ed 0 the co!rts.

Art. 9985, sec. 8. In ever0 contract, as

aid do#n 0 the a!thorities, there is

a#a0s a creditor #ho is entited to

de/and the per"or/ance, and a detor

!pon #ho/ rests the oi&ation to per"or/

the !nderta1in&. In iatera contracts the

contractin& parties are /!t!a0 creditorsand detors. Th!s, in this contract o"

ease, the essee is the creditor #ith

respect to the ri&hts en!/erated in artice

933L, and is the detor #ith respect to the

oi&ations i/posed 0 artices 9333 and

939. The ter/ #ithin #hich per"or/ance

o" the atter oi&ation is d!e is #hat has

een e"t to the #i o" the detor. This

ter/ it is #hich /!st e ;ed 0 the

co!rts.

The on0 action #hich can e /aintained

!nder the ter/s o" the contract is that 0

#hich it is so!&ht to otain "ro/ the !d&e

the deter/ination o" this period, and not

the !na#"! detainer action #hich has

een ro!&ht an action #hich


13/25

pres!pposes the epiration o" the ter/

and /a1es it the d!t0 o" the !d&e to

si/p0 decree an eviction. To /aintain the

atter action it is s!Gcient to sho# the

epiration o" the ter/ o" the contract,

#hether conventiona or e&a in order to

decree the reie" to e &ranted in the

"or/er action it is necessar0 "or the !d&e

to oo1 into the character and conditions

o" the /!t!a !nderta1in&s #ith a vie# to

s!pp0in& the ac1in& ee/ent o" a ti/e at

#hich the ease is to epire.

The o#er co!rt


14/25

G.R. No. L1787 Se"ember

12, 167

PHILIPPIN BANKING CORPORATION,

rere&e$"#$3 "e e&"/"e o4 ;*STINA

SANTOS : CANON FA*STINO,

'e(e/&e', paintiK-appeant,

vs.

L*I SH #$ er o>$ be/4 /$' /&

/'m#$#&"r/"r#? o4 "e #$"e&"/"e e&"/"e

o4 5o$3 He$3, 'e(e/&e', de"endant-

appeant.

$icanor S Sison for plainti%-appellant

&'aeta, (ibbs ) &'aeta for defendant-

appellant

CASTRO, J.:

7!stina Santos 0 Canon a!stino and her

sister =oren+o #ere the o#ners in co//on

o" a piece o" and in Mania. >on& had

een a on&-ti/e essee o" a portion o" the

propert0, pa0in& a /onth0 renta o"

P8,86.

7!stina Santos eca/e the o#ner o" theentire propert0 as her sister died #ith no

other heir. Then aread0 #e advanced in

0ears. Her on0 co/panions in the ho!se

#ere her 94 do&s and 5 /aids. >on& too1

care o" a epenses o" !stina.

FIn &rate"! ac1no#ed&/ent o" the

persona services o" the essee to her,F

7!stina Santos eec!ted on Nove/er 93,

9:34 a contract o" ease PK Eh. 2 in

"avor o" >on&, the entire propert0 #ith an

option to !0 the propert0. The ease #as

"or 36 0ears and can e ter/inated at the

option o" >ON%.

The option #as conditioned on his

otainin& Phiippine citi+enship, a petition

"or #hich #as then pendin& in the Co!rt o"

irst Instance o" Ri+a. It appears, ho#ever,

that this appication "or nat!rai+ation #as

#ithdra#n #hen it #as discovered that he

#as not a resident o" Ri+a. On Octoer 85,

9:35 she ;ed a petition to adopt hi/ and

his chidren on the erroneo!s eie" that

adoption #o!d con"er on the/ Phiippine

citi+enship. The error #as discovered and

the proceedin&s #ere aandoned.

On Nove/er 95, 9:35 she eec!ted t#o

other contracts, one PK Eh. 3 etendin&

the ter/ o" the ease to :: 0ears, and

another PK Eh. ;in& the ter/ o" the

option o" 36 0ears. )oth contracts are

#ritten in Ta&ao&.

In t#o #is eec!ted on A!&!st 8L and 8:,

9:3: De" Ehs. 853 84:, she ade here&atees to respect the contracts she had

entered into #ith >on&, !t in a codici

PK Eh. 94 o" a ater date Nove/er L,

9:3: she appears to have a chan&e o"

heart. Cai/in& that the vario!s contracts

#ere /ade 0 her eca!se o"

/achinations and ind!ce/ents practiced

0 hi/, she no# directed her eec!tor to

sec!re the ann!/ent o" the contracts.

On Nove/er 95 the present action #as;ed in the Co!rt o" irst Instance o"

Mania. The co/paint ae&ed that the

contracts #ere otained 0 >on& Fthro!&h

"ra!d, /isrepresentation, ine*!itae

cond!ct, !nd!e inU!ence and a!se o"

con;dence and tr!st o" and 0 ta1in&

advanta&e o" the hepessness o" the

paintiK and #ere /ade to circ!/vent the

constit!tiona provision prohiitin& aiens

"ro/ ac*!irin& ands in the Phiippines and

aso o" the Phiippine Nat!rai+ation =a#s.F

The co!rt #as as1ed to direct the Re&istero" Deeds o" Mania to cance the

re&istration o" the contracts and to order

>on& to pa0 7!stina Santos the additiona

rent o" P2,986 a /onth "ro/ Nove/er

93, 9:34 on the ae&ation that the

reasonae renta o" the eased pre/ises

#as P,8L6 a /onth.


15/25

In his ans#er, >on& ad/itted that he

eno0ed her tr!st and con;dence as proo"

o" #hich he vo!nteered the in"or/ation

that, in addition to the s!/ o" P2,666

#hich he said she had deivered to hi/ "or

sa"e1eepin&, another s!/ o" P88,666 had

een deposited in a oint acco!nt #hich he

had #ith one o" her /aids. )!t he denied

havin& ta1en advanta&e o" her tr!st in

order to sec!re the eec!tion o" the

contracts in *!estion. As co!ntercai/ he

so!&ht the recover0 o" P:,896.L: #hich he

said she o#ed hi/ "or advances.

>on&s ad/ission o" the receipt o"

P88,666 and P2,666 #as the c!e "or the

;in& o" an a/ended co/paint. Th!s on

7!ne :, 9:6, aside "ro/ the n!it0 o" thecontracts, the coection o" vario!s

a/o!nts ae&ed0 deivered on diKerent

occasions #as so!&ht.

7!d&/ent o" o#er co!rt $ a contracts are

void ecept the 9st ease contract.

Pendin& appea, oth parties died and

#ere s!stit!ted.

7!stina Santos /aintained that theease contract sho!d have een ann!ed.

Para&raph 3 o" the ease contract states

that FThe essee /a0 at an0 ti/e

#ithdra# "ro/ this a&ree/ent.F It is

cai/ed that this stip!ation oKends artice

9265 o" the Civi Code #hich provides that

Fthe contract /!st ind oth contractin&

parties its vaidit0 or co/piance cannot

e e"t to the #i o" one o" the/.F

>e have had occasion to deineate the

scope and appication o" artice 9265 in

the ear0 case o" Taylor v *y Tieng

+iao.9 >e said in that case$

Artice 983 'no# art. 9265( o" the

Civi Code in o!r opinion creates no

i/pedi/ent to the insertion in a

contract "or persona service o" a

reso!tor0 condition per/ittin& the

canceation o" the contract 0 one

o" the parties. S!ch a stip!ation,

as can e readi0 seen, does not

/a1e either the vaidit0 or the

"!;/ent o" the contract

dependent !pon the #i o" the

part0 to #ho/ is conceded the

privie&e o" canceation "or #here

the contractin& parties have

a&reed that s!ch option sha eist,

the eercise o" the option is as

/!ch in the "!;/ent o" the

contract as an0 other act #hich

/a0 have een the s!ect o"

a&ree/ent. Indeed, the

canceation o" a contract inaccordance #ith conditions a&reed

!pon e"orehand is "!;/ent.8

And so it #as hed in elencio v y Tiao

.ay 2 that a Fprovision in a ease contract

that the essee, at an0 ti/e e"ore he

erected an0 !idin& on the and, /i&ht

rescind the ease, can hard0 e re&arded

as a vioation o" artice 983 'no# art.

9265( o" the Civi Code.F

The case o" Singson /ncarnacion v

0aldo"ar L cannot e cited in s!pport o"

the cai/ o" #ant o" /!t!ait0, eca!se o"

a diKerence in "act!a settin&. In that case,

the essees ar&!ed that the0 co!d occ!p0

the pre/ises as on& as the0 paid the rent.

This is o" co!rse !ntenae, "or as this

Co!rt said, FI" this de"ense #ere to e

ao#ed, so on& as de"endants eected to

contin!e the ease 0 contin!in& the

pa0/ent o" the rentas, the o#ner #o!d

never e ae to discontin!e itconverse0, atho!&h the o#ner sho!d

desire the ease to contin!e the essees

co!d eKective0 th#art his p!rpose i" the0

sho!d pre"er to ter/inate the contract 0

the si/pe epedient o" stoppin& pa0/ent

o" the rentas.F Here, in contrast, the ri&ht

o" the essee to contin!e the ease or to


16/25

ter/inate it is so circ!/scried 0 the

ter/ o" the contract that it cannot e said

that the contin!ance o" the ease depends

!pon his #i. At an0 rate, even i" no ter/

had een ;ed in the a&ree/ent, this case

#o!d at /ost !sti"0 the ;in& o" a

period3 !t not the ann!/ent o" the

contract.

Nor is there /erit in the cai/ that as the

portion o" the propert0 "or/er0 o#ned 0

the sister o" 7!stina Santos #as sti in the

process o" sette/ent in the proate co!rt

at the ti/e it #as eased, the ease is

invaid as to s!ch portion. 7!stina Santos

eca/e the o#ner o" the entire propert0

!pon the death o" her sister =oren+o on

Septe/er 88, 9:34 0 "orce o" artice444 o" the Civi Code. Hence, #hen she

eased the propert0 on Nove/er 93, she

did so aread0 as o#ner thereo". As this

Co!rt epained in !phodin& the sae

/ade 0 an heir o" a propert0 !nder

!dicia ad/inistration$

That the and co!d not ordinari0

e evied !pon #hie in custodia

legis does not /ean that one o" the

heirs /a0 not se the ri&ht,interest or participation #hich he

has or /i&ht have in the ands

!nder ad/inistration. The ordinar0

eec!tion o" propert0 in custodia

legis is prohiited in order to avoid

inter"erence #ith the possession 0

the co!rt. )!t the sae /ade 0 an

heir o" his share in an inheritance,

s!ect to the res!t o" the pendin&

ad/inistration, in no #ise stands in

the #a0 o" s!ch ad/inistration.

It is net contended that the ease

contract #as otained 0 >on& in

vioation o" his ;d!ciar0 reationship #ith

7!stina Santos, contrar0 to artice 9L, in

reation to artice 9:L9 o" the Civi Code,

#hich dis*!ai;es Fa&ents "ro/ easin&

the propert0 #hose ad/inistration or sae

/a0 have een entr!sted to the/.F )!t

>on& #as never an a&ent o" 7!stina

Santos. The reationship o" the parties,

atho!&h ad/itted0 cose and

con;dentia, did not a/o!nt to an a&enc0

so as to rin& the case #ithin the

prohiition o" the a#.

7!st the sa/e, it is ar&!ed that >on& so

co/pete0 do/inated her i"e and aKairs

that the contracts epress not her #i !t

on0 his. Co!nse "or 7!stina Santos cites

the testi/on0 o" Att0. To/as S. ?!/o #ho

said that he prepared the ease contract

on the asis o" data &iven to hi/ 0 >on&

and that she tod hi/ that F#hatever Mr.

>on& #ants /!st e "oo#ed.F4

ACCORDIN%=?, the contracts in *!estion

PK Ehs. 2-4 are ann!ed and set aside

the and s!ect-/atter o" the contracts is

ordered ret!rned to the estate o" 7!stina

Santos as represented 0 the Phiippine

)an1in& Corporation >on& Hen& as

s!stit!ted 0 the de"endant-appeant =!i

She is ordered to pa0 the Phiippine

)an1in& Corporation the s!/ o"

P3,3L.23, #ith e&a interest "ro/ the

date o" the ;in& o" the a/endedco/paint and the a/o!nts consi&ned in

co!rt 0 >on& Hen& sha e appied to

the pa0/ent o" renta "ro/ Nove/er 93,

9:3: !nti the pre/ises sha have een

vacated 0 his heirs. Costs a&ainst the

de"endant-appeant.


17/25

LO*RDS +ALRIO LI!, petitioner,

vs.

POPL OF TH

PHILIPPINS, respondent.

RLO+A, J.:

Petitioner =o!rdes Baerio =i/ #as "o!nd

&!it0 o" the cri/e o" esta"a

ro/ this !d&/ent, appea #as ta1en to

the then Co!rt o" Appeas #hich aGr/ed

the decision o" the o#er co!rt !t

/odi;ed the penat0 i/posed

ISSE$ is #hether the receipt, Ehiit FAF,

is a contract o" a&enc0 to se or a contract

o" sae o" the s!ect toacco et#eenpetitioner and the co/painant, Maria de

%!+/an Bda. de A0roso, there0

prec!din& cri/ina iaiit0 o" petitioner

"or the cri/e char&ed.

The ;ndin&s o" "acts o" the appeate co!rt

are as "oo#s$

... The appeant is a

!siness#o/an. On 7an!ar0

96, 9:, the appeant#ent to the ho!se o" Maria

A0roso and proposed to se

A0rosos toacco. A0roso

a&reed to the proposition o"

the appeant to se her

toacco consistin& o" 93

1ios at P9.26 a 1io. The

appeant #as to receive the

overprice "or #hich she

co!d se the toacco.

De/ands "or the pa0/ent

o" the aance o" the va!e

o" the toacco #ere /ade

!pon the appeant 0

A0roso, and partic!ar0 0

her sister, Sa!d )ant!&.

Sa!d )ant!& "!rther

testi;ed that she had &one

to the ho!se o" the

appeant severa ti/es, !t

the appeant o"ten e!ded

her and that the Fca/arinF

the appeant #as e/pt0.

9. >hether or not the

Honorae Co!rt o" Appeas

#as e&a0 ri&ht in hodin&

that the "ore&oin&

doc!/ent Ehiit FAF

F;ed a periodF and Fthe

oi&ation #as there"ore,

i//ediate0 de/andae as

soon as the toacco #as

sodF Decision, p. as

a&ainst the theor0 o" the

petitioner that theoi&ation does not ; a

period, !t "ro/ its nat!re

and the circ!/stances it

can e in"erred that a period

#as intended in #hich case

the on0 action that can e

/aintained is a petition to

as1 the co!rt to ; the

d!ration thereo"

8. >hether or not theHonorae Co!rt o" Appeas


that FArt. 99:4 o" the Ne#

Civi Code does not app0F

as a&ainst the aternative

theor0 o" the petitioner that

the "ore. &oin& receipt

Ehiit FAF &ives rise to an

oi&ation #herein the

d!ration o" the period

depends !pon the #i o" the

detor in #hich case theon0 action that can e

/aintained is a petition to

as1 the co!rt to ; the

d!ration o" the period and

2. >hether or not the

honorae Co!rt o" Appeas


18/25


that the "ore&oin& receipt is

a contract o" a&enc0 to se

as a&ainst the theor0 o" the

petitioner that it is a

contract o" sae. pp. 2-L,

Roo

It is cear in the a&ree/ent, Ehiit FAF,

that the proceeds o" the sae o" the

toacco sho!d e t!rned over to the

co/painant as soon as the sa/e #as

sod, or, that the oi&ation #as

i//ediate0 de/andae as soon as the

toacco #as disposed o". Hence, Artice

99:4 o" the Ne# Civi Code, #hich

provides that the co!rts /a0 ; the

d!ration o" the oi&ation i" it does not ;a period, does not app0.

Anent the ar&!/ent that petitioner #as

not an a&ent eca!se Ehiit FAF does not

sa0 that she #o!d e paid the

co//ission i" the &oods #ere sod, the

Co!rt o" Appeas correct0 resoved the

/atter as "oo#s$

... Aside "ro/ the "act that

Maria A0roso testi;ed thatthe appeant as1ed her to

e her a&ent in sein&

A0rosos toacco, the

appeant herse" ad/itted

that there #as an

a&ree/ent that !pon the

sae o" the toacco she

#o!d e &iven so/ethin&.

The appeant is a

!siness#o/an, and it is

!neievae that she #o!d

&o to the etent o" &oin& toA0rosos ho!se and ta1e the

toacco #ith a eep #hich

she had ro!&ht i" she did

not intend to /a1e a pro;t

o!t o" the transaction.

Certain0, i" she #as doin& a

"avor to Maria A0roso and it

#as A0roso #ho had

re*!ested her to se her

toacco, it #o!d not have

een the appeant #ho

#o!d have &one to the

ho!se o" A0roso, !t it

#o!d have een A0roso

#ho #o!d have &one to the

ho!se o" the appeant and

deiver the toacco to the

appeant. p. 9:, Roo

The "act that appeant received the

toacco to e sod at P9.26 per 1io and

the proceeds to e &iven to co/painant

as soon as it #as sod, stron&0 ne&ates

trans"er o" o#nership o" the &oods to the

petitioner. The a&ree/ent Ehiit FAconstit!ted her as an a&ent #ith the

oi&ation to ret!rn the toacco i" the

sa/e #as not sod.

ACCORDIN%=?, the petition "or revie# on

certiorari is dis/issed "or ac1 o" /erit.

>ith costs.

SO ORDERED.


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GREGORIO ARANETA, INC., petitioner,vs.THE PHILIPPINE SUGAR ESTATESDEVELOPMENT CO., LTD., respondent.

REYES, J.B.L., J.:

RTC CA ruled in favor of Phil sugar as plaintiff

FACTS:

Araneta, in behalf of JM tuason, sold a lot toPhil sugar estate.

The parties stipulated, among in the ontratof purhase and sale !ith mortgage, that thebu"er !ill #

$uild on the said parel land the Sto.%omingo Churh and Convent

!hile the seller for its part !ill #

Construt streets on the &' and &(and S( sides of the land herein soldso that the latter !ill be a blo)surrounded b" streets on all four sides* and the street on the &' sideshall be named +Sto. %omingo

Avenue*+

Phil sugar as bu"er omplied !ith itsobligation !hile regorio araneta failed toompl" beause of a third person !ho refusedto vaate. Phil sugar filed a ase for speifiperformane.

%'F'&S': ation is premature beause thereis no period fi-ed "et for ompliane

TC dismissed. 1äwphï1.ñët

MR !as granted ourt fi-ed the period for /"ears.

CA upheld the deision of the TC. .

Ruling on the above ontention, the appellateourt delared that the fi-ing of a period !as!ithin the pleadings and that there !as no

true hange of theor" after the submission of the ase for deision sine defendant0appellant regorio Araneta, 1n. itself s2uarel"plaed said issue b" alleging in paragraph 3of the affirmative defenses ontained in its

ans!er !hih reads #

3. 4nder the %eed of Sale !ithMortgage of Jul" /5, 6789, hereindefendant has a reasonable time!ithin !hih to ompl" !ith itsobligations to onstrut and ompletethe streets on the &', &( and S(sides of the lot in 2uestion* that under the irumstanes, said reasonabletime has not elapsed*

1SS4': (on the ourt gravel" abused itsdisretion !hen it fi-ed a period for the partiespursuant to 6673 ;'S

(e agree !ith the petitioner that the deisionof the Court of Appeals, affirming that of theCourt of First 1nstane is legall" untenable.The fi-ing of a period b" the ourts under

Artile 6673 of the Civil Code of thePhilippines is sought to be plaedthe absene of a period in issue b" pleadingin its ans!er that the ontrat !ith respondent

Philippine Sugar 'states %evelopment Co.,?td. gave petitioner regorio Araneta, 1n.+reasonable time !ithin !hih to ompl" !ithits obligation to onstrut and omplete thestreets.+ &either of the ourts belo! seems tohave notied that, on the h"pothesis stated,!hat the ans!er put in issue !as not !hether the ourt should fi- the time of performane,but !hether or not the parties agreed that thepetitioner should have reasonable time toperform its part of the bargain. 1f the ontratso provided, then there !as a period fi-ed, a

+reasonable time*+ and all that the ourtshould have done !as to determine if thatreasonable time had alread" elapsed !hensuit !as filed if it had passed, then the ourtshould delare that petitioner had breahedthe ontrat, as averred in the omplaint, andfi- the resulting damages.


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@n the other hand, if the reasonable time hadnot "et elapsed, the ourt perfore !as boundto dismiss the ation for being premature. $utin no ase an it be logiall" held that under the plea above 2uoted, the intervention of theourt to fi- the period for performane !as

!arranted, for Artile 6673 is preisel"prediated on the absene of an" period fi-edb" the parties.

'ven on the assumption that the ourt shouldhave found that no reasonable time or noperiod at all had been fi-ed =and the trialourts amended deision no!here delaredan" suh fat> still, the omplaint not havingsought that the Court should set a period, theourt ould not proeed to do so unless theomplaint in as first amended* for the originaldeision is lear that the omplaint proeededon the theor" that the period for performanehad alread" elapsed, that the ontrat hadbeen breahed and defendant !as alread"ans!erable in damages.

ranting, ho!ever, that it la" !ithin theCourts po!er to fi- the period of performane,still the amended deision is defetive in thatno basis is stated to support the onlusionthat the period should be set at t!o "earsafter finalit" of the ,+ but fromthe nature and the irumstanes it an be

inferred that a period !as intended+ =Art.6673, pars. 6 and />. This preliminar" pointsettled, the Court must then proeed to theseond step, and deide !hat period !as+probabl" ontemplated by the parties+ =%o.,par. >. So that, ultimatel", the Court an not

fi- a period merel" beause in its opinion it isor should be reasonable, but must set thetime that the parties are sho!n to haveintended..

1n this onnetion, it is to be borne in mindthat the ontrat sho!s that the parties !erefull" a!are that the land desribed therein!as oupied b" s2uatters, beause the fatis e-pressl" mentioned therein =Re. on

Appeal, Petitioners Appendi- $, pp. 6/06>. As the parties must have )no!n that the"ould not ta)e the la! into their o!n hands,but must resort to legal proesses in evitingthe s2uatters, the" must have realiDed that theduration of the suits to be brought !ould notbe under their ontrol nor ould the same bedetermined in advane. The onlusion is thusfored that the parties must have intended todefer the performane of the obligations under the ontrat until the s2uatters !ere dul"evited, as ontended b" the petitioner regorio Araneta, 1n.

The Court of Appeals ob


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petitioner regorio Araneta, 1n. is hereb"fi-ed at the date that all the s2uatters onaffeted areas are finall" evited therefrom.

PACIFICA MILLARE, petitioner,vs.HON. HAROLD M. HERNANDO, In hiscapaci! as P"#si$in% J&$%#, C'&" '( Insanc# '( A)"a, S#c'n$ J&$icia* Dis"ic,B"anch I, ANTONIO CO an$ ELSACO, respondents.

FELICIANO, J.:

8 "ear lease ontrat b" paifia in favor of respondent elsa o.

'-pir" date Ma" 6 6759.

Aording to the Co spouses, sometimeduring the last !ee) of Ma" 6759, the lessor informed them that the" ould ontinueleasing the Peoples Restaurant so long asthe" !ere amenable to pa"ing reased rentals

of P6,/99.99 a month. 1n response, aounteroffer of P399.99 a month !as made b"the Co spouses. At this point, the lessor allegedl" stated that the amount of monthl"rentals ould be resolved at a later time sine+the matter is simple among us+, !hihalleged remar) !as supposedl" ta)en b" thespouses Co to mean that the Contrat of ?ease had been rene!ed, prompting them toontinue oup"ing the sub ordering thedefendant to pa" damages in the amount of P89,999.99. The follo!ing Monda", on 6September 6759, Mrs. Millare filed an ese2uentl" set up lis pendens as a Civil Case&o. EE6. The spouses Co, defendants therein,subse2uentl" set up lis pendens as a defenseagainst the omplaint for e la) of ause of ation

due to plaintiffs failure to establish a validrene!al of the Contrat of ?ease, and =b> la) of


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(e turn to the seond issue, that is, !hether or not the omplaint in Civil Case &o. 6BBfiled b" the respondent Co spouses laimingrene!al of the ontrat of lease stated a validause of ation. Paragraph 6 of the Contratof ?ease reads as follo!s:

6. This ontrat of lease issub


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+fly(by night un!ust enrichent" at the e-pense of said lessees* but, no Manshould un "ears, itfollo!s, therefore, that thelease ontrat is rene!able for another five =8> "ears and thelessee is not re2uired beforehand to give e-press notie of this fat to the lessor beauseit !as e-pressl" stipulated in

the original lease ontrat tobe rene!ed* (herefore, thebare refusal of the lessor torene! the lease ontratunless the monthl" rental isP6,/99.99 is ontrar" to la!,

morals, good ustoms, publipoli",

"ears. /2

Clearl", the respondent


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The ourts shall also fi- theduration of the period when it depends upon the will of thedebtor.

1n ever" ase, the ourts shall

determine suh period as ma",under the irumstanes, havebeen probabl" ontemplatedb" the parties. @ne fi-ed b"the ourts, the period annotbe hanged b" them.='mphasis supplied.>

The first paragraph of Artile 6673 is learl"inappliable, sine the Contrat of ?ease didin fat fi- an original period of five "ears,!hih had e-pired. 1t is also lear from

paragraph 6 of the Contrat of ?ease that theparties reserved to themselves the fault" of agreeing upon the period of the rene!alontrat. The seond paragraph of Artile6673 is e2uall" learl" inappliable sine theduration of the rene!al period !as not left tothe !iu of the lessee alone, but rather to the!ill of both the lessor and the lessee. Mostimportantl", Artile 6673 applies onl" !here aontrat of lease learl" e-ists. ere, theontrat !as not rene!ed at all, there !as infat no ontrat at all the period of !hih ouldhave been fi-ed.

Artile 6E39 of the Civil Code reads thus:

1f at the end of the ontrat thelessee should ontinueen !ere pa"able on a monthl"basis. At the latest, an implied ne! lease =hadone arisen> !ould have e-pired as of the endof Jul" 6759 in vie! of the !ritten demandsserved b" the petitioner upon the privaterespondents to vaate the previousl" leasedpremises.

1t follo!s that the respondent


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parties themselves. Contrats spring from thevolition of the parties. That volition annot besupplied b" a and B&ovember 6759 =den"ing petitioners motion

for reonsideration>, and the +Judgment b"%efault+ rendered b" the respondent

As to Perfection Cases

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