G.R. No. 108164 Case Digest

G.R. No. 108164 February 23, 1995
Far East Bank and Trust Company, petitioner
vs Court of Appeals, Luisa Luna and Clarita Luna, respondents
Ponente: Vitug

Facts:
Luis Luna applied for a far east card issued by far east bank at its Pasig branch. Upon his request, the bank also issued a supplemental card to private respondent Clarita Luna. Then Clarita lost her credit card and submitted an affidavit of loss. Later on October 6, 1988 in a restaurant, Luis' credit card was not honored.

Luis thru a counsel then demanded from far east to pay damages for the humiliation he felt. The vice-president of the bank expressed bank's apologies to Luis.

Still evidently feeling aggrieved, private respondents, on 05 December 1988, filed a complaint for damages with the Regional Trial Court ("RTC") of Pasig against FEBTC.
On 30 March 1990, the RTC of Pasig, given the foregoing factual settings, rendered a decision ordering FEBTC to pay private respondents (a) P300,000.00 moral damages; (b) P50,000.00 exemplary damages; and (c) P20,000.00 attorney's fees.
On appeal to the Court of Appeals, the appellate court affirmed the decision of the trial court.
Its motion for reconsideration having been denied by the appellate court, FEBTC has come to this Court with this petition for review.

There is merit in this appeal.
In culpa contractual, moral damages may be recovered where the defendant is shown to have acted in bad faith or with malice in the breach of the contract. The Civil Code provides:
Art. 2220. Willful injury to property may be a legal ground for awarding moral damages if the court should find that, under the circumstances, such damages are justly due. The same rule applies to breaches of contract where the defendant acted fraudulently or in bad faith.

Bad faith, in this context, includes gross, but not simple, negligence. Exceptionally, in a contract of carriage, moral damages are also allowed in case of death of a passenger attributable to the fault (which is presumed) of the common carrier.

Held:
The Court has not in the process overlooked another rule that a quasi-delict can be the cause for breaching a contract that might thereby permit the application of applicable principles on tort 9 even where there is a pre-existing contract between the plaintiff and the defendant. This doctrine, unfortunately, cannot improve private respondents' case for it can aptly govern only where the act or omission complained of would constitute an actionable tort independently of the contract. The test (whether a quasi-delict can be deemed to underlie the breach of a contract) can be stated thusly: Where, without a pre-existing contract between two parties, an act or omission can nonetheless amount to an actionable tort by itself, the fact that the parties are contractually bound is no bar to the application of quasi-delict provisions to the case. Here, private respondents' damage claim is predicated solely on their contractual relationship; without such agreement, the act or omission complained of cannot by itself be held to stand as a separate cause of action or as an independent actionable tort.

G.R. No. L-25134 Case Digest

G.R. No. L-25134 October 30, 1969

The City of Bacolod, plaintiff-appellee

vs San Miguel Brewery, Inc., defendant-appellant

Ponente: Barredo

Facts:

This is an appeal from the decision of the CFI Negros Occidental ordering the San Miguel Brewery to pay to the City of Bacolod certain fees under existing City ordinances of Bacolod.

February 17, 1949 the City of Bacolod passed Ordinance No. 66 imposing upon "any person, firm or corporation engaged in the manufacturer bottling of coca-cola, pepsi cola, tru orange, lemonade, and other soft drinks within the jurisdiction of the City of Bacolod, ... a fee of ONE TWENTY-FOURTH (1/24) of a centavo for every bottle thereof," plus "a surcharge of 2% every month, but in no case to exceed 24% for one whole year," upon "such local manufacturers or bottler above-mentioned who will be delinquent on any amount of fees due" under the ordinance.

In 1959, this ordinance was amended by Ordinance No. 150, series of 1959, by increasing the fee to "one-eighth (1/8) of a centavo for every bottle thereof." In other words, the fee was increased from P0.01 to P0.03 per case of soft drinks. Appellant refused to pay the additional fee and challenged the validity of the whole ordinance.

appellant filed a motion to dismiss the case on the grounds that: (1) the cause of action is barred by a prior judgment, and (2) a party may not institute more than one suit for a single cause of action. This motion was denied by the court a quo in its order dated August 22, 1964; so appellant filed its answer wherein it substantially reiterated, as affirmative defenses, the above-mentioned grounds of its motion to dismiss. Thereafter, the parties submitted the case for judgment on the pleadings, whereupon, the court rendered judgment on March 11, 1965 with the following dispositive portion: .

IN VIEW THEREOF, judgment is hereby rendered ordering the defendant San Miguel Brewery, Inc. to pay to the plaintiff the sum of P36,519.10 representing the surcharges as provided in section 4 of Ordinance 66, series of 1949 of the City of Bacolod. No costs.

Appellants moved for reconsideration but its motion was denied, hence, the instant appeal.

Appellant has only one assignment of error, to wit:

THE LOWER COURT ERRED IN FINDING THE APPELLANT LIABLE TO THE APPELLEE FOR THE SUM OF P36,519.10 REPRESENTING SURCHARGES AS PROVIDED IN TAX ORDINANCE NO. 66, SERIES OF 1949, AS AMENDED, OF THE CITY OF BACOLOD.

Under this, it argues that the action of appellee cannot be maintained because (1) a party may not institute more than one suit for a single cause of action; and (2) appellee's action for recovery of the surcharges in question is barred by prior judgment.

Held:

We find appellant's position essentially correct. There is no question that appellee split up its cause of action when it filed the first complaint on March 23, 1960, seeking the recovery of only the bottling taxes or charges plus legal interest, without mentioning in any manner the surcharges.

The rule on the matter is clear. Sections 3 and 4 of Rule 2 of the Rules of Court of 1940 which were still in force then provided:

SEC. 3. Splitting a cause of action, forbidden. — A single cause of action cannot be split up into two or more parts so as to be made the subject of different complaints. .

SEC. 4. Effect of splitting. — If separate complaints were brought for different parts of a single cause of action, the filing of the first may be pleaded in abatement of the others, and a judgment upon the merits in either is available as a bar in the others.

In the light of these precedents, it cannot be denied that appellant's failure to pay the bottling charges or taxes and the surcharges for delinquency in the payment thereof constitutes but one single cause of action which under the above rule can be the subject of only one complaint, under pain of either of them being barred if not included in the same complaint with the other. The error of appellee springs from a misconception or a vague comprehension of the elements of a cause of action. The classical definition of a cause of action is that it is "a delict or wrong by which the rights of the plaintiff are violated by the defendant." Its elements may be generally stated to be (1) a right existing in favor of the plaintiff; (2) a corresponding obligation on the part of the defendant to respect such right; and (3) an act or omission of the plaintiff which constitutes a violation of the plaintiff's right which defendant had the duty to respect. For purposes, however, of the rule against splitting up of a cause of action, a clearer understanding can be achieved, if together with these elements, the right to relief is considered.

In the case at bar, when appellant failed and refused to pay the difference in bottling charges from July 1, 1959, such act of appellant in violation of the right of appellee to be paid said charges in full under the Ordinance, was one single cause of action, but under the Ordinance, appellee became entitled, as a result of such non-payment, to two reliefs, namely: (1) the recovery of the balance of the basic charges; and (2) the payment of the corresponding surcharges, the latter being merely a consequence of the failure to pay the former. Stated differently, the obligation of appellant to pay the surcharges arose from the violation by said appellant of the same right of appellee from which the obligation to pay the basic charges also arose. Upon these facts, it is obvious that appellee has filed separate complaints for each of two reliefs related to the same single cause of action, thereby splitting up the said cause of action.

" In other words, whenever a plaintiff has filed more than one complaint for the same violation of a right, the filing of the first complaint on any of the reliefs born of the said violation constitutes a bar to any action on any of the other possible reliefs arising from the same violation, whether the first action is still pending, in which event, the defense to the subsequent complaint would be litis pendentia, or it has already been finally terminated, in which case, the defense would be res adjudicata. Indeed, litis pendentia and res adjudicata, on the one hand, and splitting up a cause of action on the other, are not separate and distinct defenses, since either of the former is by law only the result or effect of the latter, or, better said, the sanction for or behind it.

G.R. No. L-31095 Case Digest

G.R. No. L-31095 June 18, 1976

Jose Hernandez, petitioner

vs Development Bank of the Philippines and Court of First Instance of Batangas, Lipa City Branch, respondents

Ponente: Martin

Facts:

This is a case which involves the question of proper venue in real action.

Hernandez was an employee of private respondent DBP in its legal department for 21 years until he retired due to illness. DBP then awarded Hernandez a lot, payable by installment under the housing project committee of DBP. Hernandez paid the total amount of the lot using a check issued by the Philippine Banking Corporation in the name of his wife. However, more than a week after, the check was returned to Hernandez informing him that the award was cancelled on the following grounds: (1) that he has already retired; (2) that he has only an option to purchase said house and lot; (3) that there are a big number of employees who have no houses or lots; (4) that he has been given his retirement gratuity; and (5) that the awarding of the aforementioned house and lot to an employee of the private respondent would better observe the objective of its Housing Project. Petitioner protested against the cancellation of the award of the house and lot in his favor and demanded from private respondent the restoration of all his rights to said award. However, private respondent refused.

Hernandez filed a complaint in the CFI of Batangas seeking for the annulment of the cancellation of the award. He alleged that the cancellation was unwarranted and illegal for he has already become the owner of the said house and lot by virtue of said award on August 12, 1964 which cannot be unilaterally cancelled without his consent.

DBP filed a motion to dismiss on the ground of improper venue considering that the house and lot is in Quezon City.

Issue: Whether the action of the petitioner was properly filed in the CFI.

Held:

It is a well settled rule that venue of actions or, more appropriately, the county where the action is triable depends to a great extent on the nature of the action to be filed, whether it is real or personal. A real action is one brought for the specific recovery of land, tenements, or hereditaments. A personal action is one brought for the recovery of personal property, for the enforcement of some contract or recovery of damages for its breach, or for the recovery of damages for the commission of an injury to the person or property. 4 Under Section 2, Rule 4 of the Rules of Court, "actions affecting title to, or for recovery of possession, or for partition, or condemnation of , or foreclosure of mortgage in real property, shall be commenced and tried where the defendant or any of the defendants resides or may be found, or where the plaintiff or any of the plaintiffs resides, at the election of the plaintiff".

A close scrutiny of the essence of the petitioner's complaint in the court a quo would readily show that he seeks the annulment of the cancellation of the award of the Quezon City lot and house in his favor originally given him by respondent DBP in recognition of his twenty-one years of service in its Legal Department, in pursuance of his contention that he had acquired a vested right to the award which cannot be unilaterally cancelled by respondent without his consent.

The Court agrees that petitioner's action is not a real but a personal action. As correctly insisted by petitioner, his action is one to declare null and void the cancellation of the lot and house in his favor which does not involve title and ownership over said properties but seeks to compel respondent to recognize that the award is a valid and subsisting one which it cannot arbitrarily and unilaterally cancel and accordingly to accept the proffered payment in full which it had rejected and returned to petitioner.

G.R. No. L-4604 Case Digest

G.R. No. L-4604 January 12, 1909

Gutierrez Hermanos, plaintiff-appellees

vs Antonio de la Riva, defendant-appellant

Ponente: Willard

Facts:

Harmanos is a general partnership in Manila engaged in the purchase of hemp, copra and other products. dela Riva became the owner of a business consisted in the purchase of products to Manila in 1903. Business relations were established between plaintiff and the defendant, and a n account was opened between them. The balance due on December 31,1903 this current account was agreed by the parties. In August, a receiver of dela Riva in Catanduanes was appointed which caused the business relations between two companies to cease. So, Hermanos made a demand on the account balance from dela Riva. Payment was refused. Hermanos brought this action asking for the payment with interest. Dela Riva made objections to different items in the account as well as on the currency used.

Held:

After a careful study of all the evidence relating to this counterclaim, we agree entirely with the above-quoted conclusions of the court below. It is very improbable that the plaintiffs ever agreed with the defendants to pay Molina the purchase price of this property. If they had made such agreement they would themselves have bought the property, and that agreement would undoubtedly have appeared somewhere in writing. That the plaintiffs did make large advances to the defendant upon the purchase by him of the business appears in the evidence. They paid the first installment of P33,000 due Molina at the time the contract was made, by crediting Molina with the amount upon the current account which they had with him, and charging the same amount to the defendant in his current account. It moreover appears that before they had received any money or other property from the defendant they had made other advances to him, to such an amount that, as De la Riva himself testified, from the beginning he owed them P60,000.

The failure to pay the second installment due Molina cannot, we think, be attributed to plaintiffs. In the property sold by Molina to De la Riva were included claims against various persons in Catanduanes, amounting to a large sum. Prior to the time when the second installment became due the defendant had notified the plaintiffs that some of these claims could not be collected, and in view of the fact that Molina in the contract that guaranteed their payment he insisted that the amount of the uncollectible debts, which, as he afterwards stated in a counterclaim presented against Molina reached the sum of P72,000, should be deducted from the price. Molina's agent was notified that this claim and refused to admit it. No agreement could be reached between the parties, and Molina commenced his second action, as has been stated, in August, 1905. It is true that the defendant testified that he repeatedly asked the plaintiffs to pay this second installment, but the documentary evidence indicates that he insisted upon some allowance by reason of the uncollectible debts.

The judgment of the court below is modified, by changing the amount thereof, to wit, P94,222.50, to P93,963.30, and with this modification it is affirmed and judgment ordered against the defendant for P93,963.30, with interest thereon from the 1st of January, 1906, at 8 per cent per annum, and the costs of the First Instance. No costs will be allowed to either party in this court.

G.R. No. L-24772 Case Digest

G.R. No. L-24772 May 27, 1968

Ruperto G. Cruz, et al., plaintiffs-appellees

vs Filipinas Investment and Finance Corporation, defendant-appellant

Ponente: Reyes

Facts:

This is an appeal by Filipinas from the decision of the CFI of Rizal. In the action of Cruz for the cancellation of the real estate mortgage constituted on the land of Cruz in favor of Filipinas, the parties submitted the case for decision on the following facts:

Cruz purchased on instalments a diesel bus with a promissory note to the Far East Motor Corporation. To secure the promissory note, Cruz executed in favor of the Motor Corporation a chattel mortgage. Since there was no down payment made, Motor Corporation required Cruz to give additional security by which was given in the form of second mortgage on a parcel of land and building owned by Felicidad Reyes.Later, Cruz defaulted on the payment of the promissory note in spite of the demands. Because of default, defendant foreclose the chattel mortgage. The proceeds of the sale of the bus were not sufficient to cover the expenses of sale, principal obligation, interest and attorney's fees. Leading to the foreclosure of the land owned by Mrs. Reyes. Mrs. Reyes then on March 20, 1964 wrote a letter to Filipinas asking for the cancellation of the real estate mortgage on her land, but defendant did not comply with such.

Issues: (1) Whether Filipinas may foreclose the real estate mortgage.

Held:

should the vendee or purchaser of a personal property default in the payment of two or more of the agreed instalments, the vendor or seller has the option to avail of any one of these three remedies — either to exact fulfilment by the purchaser of the obligation, or to cancel the sale, or to foreclose the mortgage on the purchased personal property, if one was constituted. These remedies have been recognized as alternative, not cumulative, that the exercise of one would bar the exercise of the others. It may also be stated that the established rule is to the effect that the foreclosure and actual sale of a mortgaged chattel bars further recovery by the vendor of any balance on the purchaser's outstanding obligation not so satisfied by the sale.

Considering the purpose for which the prohibition contained in Article 1484 was intended, the word "action" used therein may be construed as referring to any judicial or extrajudicial proceeding by virtue of which the vendor may lawfully be enabled to exact recovery of the supposed unsatisfied balance of the purchase price from the purchaser or his privy. Certainly, an extrajudicial foreclosure of a real estate mortgage is one such proceeding.

WHEREFORE, the decision appealed from is modified, by ordering plaintiff-appellee Felicidad Vda. de Reyes to reimburse to defendant-appellant Filipinas Investment & Finance Corporation the sum of P2,148.07, with legal interest thereon from the finality of this decision until it is fully paid. In all other respects, the judgment of the court below is affirmed, with costs against the defendant-appellant.

G.R. No. 111077 Case Digest

G.R. No. 111077 July 14, 1994

Virgilio Gesmundo and Edna Gesmundo, petitioners,

vs JRB Realty Corporation, et al, respondents.

Ponente: Mendoza

Facts:

This is a petition for review on certiorari of the order of RTC Makati, dismissing on the ground of proper venue a complaint which the spouses Gesmundo filed against the JRB Realty Corporation and Jaime Blanco.

On April 7, 1980, Virgilio Gesmundo as lessee and JRB represented by its president Jaime Blanco entered into s lease contract covering room 116 of blanco suites in Pasay City, with the stipulation that "venue for all suits, whether for branch hereof or damages or any cause between the LESSOR and the LESSEE, and persons claiming under each, being the courts of appropriate jurisdiction in Pasay City. . ."

On March 19, 1993, Gesmundo filed a complaint for damages against JRB alleging that they were shocked upon receiving a letter of termination of lease from JRB. During their telephone conversation, respondent Blanco told petitioner Virgilio B. Gesmundo that since the Corporation for which the latter works did not pay him (Blanco) his retainer fees, he did not want petitioners in any of his apartment units; that on November 18, 1992, petitioners sent respondents a letter asking for reconsideration of the termination of their lease; that on November 27, 1992, respondents sent petitioners a statement of accounts reiterating their letter of November 9, 1992; that on November 28, 1992, petitioners were forced to vacate the leased premises and consequently they leased an apartment at P2,500.00 monthly; and that respondents' action was "unwarranted, unjustified, malicious, abusive, and capricious." Petitioners prayed for P33,500.00 as actual or compensatory damages; P1,000,000.00 as moral damages; P50,000.00 as attorney's fees, and costs.

Respondents moved to dismiss the case on the ground that the venue of the action had been improperly laid in RTC Makati because of their contract stipulation that it should be in Pasay city. In opposition, petitioners alleged that hteir cause of action is not based on the lease contract and therefore not covered by the stipulation as to venue. Court dismissed petitioner's action on the ground of improper venue, it was also denied of reconsideration.

Issue: whether the venue was properly laid in the RTC of Makati.

Held: No. Stipulations limiting venues as valid and binding on the contracting parties.

Petitioners contention that neither of the parties are residents of Pasay City is irrelevant. Because it is reasonable to infer that the parties intended to fix the venue of their action in connection with the contract sued upon.

Petitioner's claim that their cause of action is not based on the lease contract because it seeks neither its implementation nor its cancellation. This contention is without merit. The warranting of award of damges is ultimately anchored on their right under the lease caontract.

On the petitioner's view that a motion to dismiss on the ground of improper venue is based on a mere technicality must not be sustained as well. Procedural rules are not to be belittled or dismissed simply just because their non-observance may have resulted to prejudice. Like all rules, they are required to be followed except for the most persuasive of reasons.

Petition denied.

G.R. No. 135962 Case Digest

G.R. No. 135962, March 27, 2000

Metropolitan Manila Development Authority, petitioner

vs Bel-Air Village Association, Inc., respondent

POnente: Puno

Facts: 

MMDA is a government agency tasked with the delivery of basic services in Metro Manila. Bel-Air is a non-stock, non-profit corporation whose members are homeowners of Bel-Air Villagee in Makati City. Bel-Air is the registered owner of the Neptune Street, a road inside Bel-Air Village.

December 30, 1995 Bel-Air received a notice from MMDA requesting Bel-Air to open Neptune St. to public vehicular traffic. On the same day, MMDA apprised that the perimeter wall separating the subdivision from the adjacent Kalayaan Avenue would be demolished.

January 2, 1996, MMDA instituted a case for injunction against Bel-Air; and prayed for a TRO and preliminary injunction enjoining Neptune St. and prohibiting the demolition of the perimeter wall. Court issued a TRO the next day.

After due hearing, RTC denied the issuance of a preliminary injunction. MMDA question the denial and appealed to the CA. CA conducted an ocular inspection of Neptune St. then issued a writ of preliminary injunction enjoining the MMDA proposed action. 

On January 27, 1997, appellate court rendered a decision finding MMDA no authority to order the opening of Neptune St. It held that the authority is in the City Council of Makati by ordinance.

The motion for reconsideration is denied hence this recourse.

Issues: (1) MMDA has the authority to mandate the opening of Neptune St. to public traffic pursuant to its regulatory and police powers? (2) Is passage of an ordinance a condition precedent before the MMDA may order the opening of subdividion roads to public traffic? (3) Is Bel-Air estopped from denying the authority of MMDA? (4)Was Bel-Air denied of due process despite the several meetings held between MMDA and Bel-Air? (5) Has Bel-Air come to court with unclean hands?

MMDA: it has the authority to open Neptune St. because it is an agent of the Government endowed with police power in the delivery of basic services in Metro Manila. From the premise of police powers, it follow then that it need not for an ordinance to be enacted first. 

**Police power is an inherent attribute of sovereignty. Police power is lodged primarily in the National Legislature, which the latter can delegate to the President and administrative boards, LGU or other lawmaking bodies.

**LGU is a political subdivision for local affairs. Which has a legislative body empowered to enact ordinances, approved resolutions and appropriate funds for the general welfare of the province/city/municipality. 

**Metro Manila is declared as a special development and administrative region in 1995. And the administration of metro-wide basic services is under the MMDA.Which includes, transport and traffice management. It should be noted that MMDA are limited to the acts: formulation, coordination, regulation, implementation, preparation, management, monitoring, setting of policies and installation of a system and administration. MMDA was not granted with legislative power.

Ruling:

(1) The basis for the proposed opening of Neptune Street is contained in the notice of December 22, 1995 sent by petitioner to respondent BAVA, through its president. The notice does not cite any ordinance or law, either by the Sangguniang Panlungsod of Makati City or by the MMDA, as the legal basis for the proposed opening of Neptune St.

(2) The MMDA is not the same entity as the MMC in Sangalang. Although the MMC is the forerunner of the present MMDA, an examination of Presidential Decree (P. D.) No. 824, the charter of the MMC, shows that the latter possessed greater powers which were not bestowed on the present MMDA.

(3) Under the 1987 Constitution, the local government units became primarily responsible for the governance of their respective political subdivisions. The MMA's jurisdiction was limited to addressing common problems involving basic services that transcended local boundaries. It did not have legislative power.

Petition Denied.