DIGEST THE FOLLOWING CASES

Write the Title of the case, the date of the decision of the Supreme and the
GR. Number and the Ponente of the case.

CASE #1 TO #5,#9,#10, #14,#15,#16 #18,#19 ARE DONE. KINDLY PARAPHRASE

NOTE: THERE ARE SOME CASES WHICH ARE NOT YET DONE

Topics COC (Consent, Object and Cause)

1. De Jesus vs. Urrutia & Co. 33 Phil 171
De Jesus vs. Urrutia 
GR. NO. `10863, January 11, 1916
  Moreland, J.

 FACTS: 

To ensure the payment, Diego Liñan, the appellant's son-in-law, executed a mortgage on
certain lands belonging to the mortgagor to the defendant company, appellee.

ISSUES: whether or not there is an attempt to defraud the creditors.

HELD

No. the trial court found in favor of the appellee and dismissed the action. The claim of appellant
to the lands in question is based on certain conveyances made by Diego Liñan of various times
from 1905 to 1908. We do not believe that article 1297 of the Civil Code is applicable to the
facts of this case. The article provides:

“Contracts by virtue of which the debtor alienates property gratuitously are presumed to be
executed in fraud of creditors.

Alienations for valuable consideration, made by a person against whom a condemnatory

judgement, in any instance, has been previously rendered, or a unit of attachment of property
has been issued, shall also be presumed fraudulent.” 

2. Mapalo vs. Mapalo 17 SCRA 14

Miguel Mapalo V. Maximo Mapalo
 GR. NO. L-21489 AND L-21628
May 19, 1966
BENGZON, J.P., J.

FACTS:

Their signatures thereto were procured by fraud, that is, they were made to believe by Maximo
Mapalo and by the attorney who acted as notary public who "translated" the document, that the
same was a deed of donation in Maximo's favor covering one-half (the eastern half) of their
land. Although the document of sale stated a consideration of Five Hundred (P500.00) Pesos,
the aforesaid spouses did not receive anything of value for the land. The attorney's
misbehaviour was the subject of an investigation but its result does not appear on record.
However we took note of the fact that during the hearing of these cases the notary public was
present but did not take the witness stand to rebut the plaintiffs' testimony supporting the
allegation of fraud in the preparation of the document.

ISSUE:  whether or not the deed of sale executed in 1936 was null and void

HELD:

No

Under the requisites of elements of contracts, the consent is present as to the deed of sale of
October 15, 1936. For consent was admittedly given, albeit obtained by fraud. Accordingly, said
consent, although defective, did exist.

3. Batara vs. Marcos 7 Phil 156

Batarra vs. Marcos
G.R. No. L-2929, December 7, 1906
WILLARD, J.

1. Facts:

 The defendant and plaintiff entered into agreement wherein they will have a sexual
relationship in exchange of a promise to marriage.

1. Issue:
Whether the plaintiff is entitled for recovery for damages

1. Ruling:
No

The facts appearing in the record do not show the commission of the crime of
seduction, as that crime is defined by article 443 of the Penal Code, because it does not appear
that the plaintiff was under 23 years of age.

4. Logan vs. Phil. Acetylene Co. 33 Phi; 177

Logan vs. Phil. Acetylene Co
G.R. No. L-11078, January 11, 1916
MORELAND, J.
 FACTS
o On the 24th of April, 1914, Clifford H. Logan (plaintiff) and Philippine Acetylene
Co. (defendant) entered into a contract. The plaintiff agreed to act as the
manager of the defendant company in the Philippine Islands for a period of 4
years, commencing May 1, 1911, and ending April 30, 1915.The agreement
 contained a provision that, at any time during the term of such employment,
either party might cancel the agreement and terminate the same by his giving the
other party three months written notice in advance of his or its intention so to do.

 ISSUES
o Whether or not the plaintiff was still in the employ of the defendant under the
contract and entitled to receive the wages stipulated, until the defendant should
terminate the relation in the manner provided by the contract.
 RULING/HELD
o  Yes
The appellant is entitled to earn/receive his salary from the company that
amounts to P1,500 with an interest according to the decision of the Court En
Banc, its basis is the contract they entered wherein the effectivity of resignation is
after three months when the other party is notified.

5. Aldaba vs. Court of Appeals 27 Scra 263

Aldaba vs. CA
G.R. No. L-21676, February 28, 1969
ZALDIVAR, J. 

FACTS:

Belen Aldaba died on February 25, 1955, she is a rich woman wherein the deceased owns two
properties. Sheleft as her presumptive heirs her surviving husband Estanislao Bautista, and her
brother Ces ar Aldaba. 
Vicente Aldaba and Jane Aldaba were the professionals in which Belen Aldaba sought medical
assistance. When the latter's house was burned, Belen Aldaba invited them to occupy her one
property and the latter accepted the offer wherein they provided medical assistance to Belen for
10 years starting 1945 until February 1955 when she died.

Emmanuel Bautista then required Dr. Vicente Aldaba to vacate the lots in question and, upon
the latter's refusal, filed an ejectment case against him in the City Court of Manila.

ISSUE:

Whether or not there was an onerous donation made by Belen Aldaba.

RULING:

No,

The conclusion of the Court of Appeals, as well as that of the trial court, that there was no
onerous donation made by Belen Aldaba to petitioners is based upon their appreciation of the
evidence, and this Court will not disturb the factual findings of those courts wherein this decision
was affirmed by Court En Banc. The service that was given to Belen Aldaba by Vicente and
Jane can’t be compensate through owning the property because when a person does not
expect to be paid for his services, there cannot be a contract implied in fact to make
compensation for said services.

6. Southern Sugar & Molasses Co. vs. Atlantic Gulf Pacific & Company 97
Phil 249
Southern Sugar & Molasses Co. vs. Atlantic Gulf Pacific & Company
G.R. No. L-7382, June 29, 1955
BAUTISTA ANGELO, J.

Facts:

The Atlantic Gulf & Pacific Company of Manila granted an option to Southwestern Sugar &
Molasses Co. (Far East) Inc., hereafter called Southwestern Company, to buy its barge No. 10
for P30,000. The option was to be exercised within a period of ninety days.
On June 29, 1953, the Atlantic Gulf withdraw its "offer of option" with due notices to the
Southwestern Company stating as reason therefor that the option was granted merely as a
favor. The Atlantic Gulf set up as a defense the option to sell made by it to the Southwestern
Company is null and void because it is not supported by any consideration.

Issue:

Whether the defendant was set up as a defense the option to sell made by it to the
Southwestern Company is null and void because it is not supported by any consideration.

Ruling:

Yes

The lower court rendered judgment granting the plaintiff's prayer for specific performance. It
further ordered the defendant to pay damages in an amount equivalent to 6 per centum per
annum on the sum of P30,000 from the date of the filing of the complaint and to pay the sum of
P600 as attorney's fees, plus the costs of the action.
Under article 1479 of the new Civil Code "an option to sell", or a "promise to buy or to sell", as
used in said article, to be valid must be "supported by a consideration distinct from the price." In
other words, "an accepted unilateral promise" can only have a binding effect if supported by a
consideration, which means that the option can still be withdrawn, even if accepted if the same
is not supported by any consideration. Here it is not disputed that the option is without
consideration. It can therefore be withdrawn notwithstanding the acceptance made of it by the
appellee.
And under Article 1324 of the new Civil Code, the general rule regarding offer and acceptance is
that, when the offerer gives to the offeree a certain period to accept, "the offer may be
withdrawn at any time before acceptance" except when the option is founded upon
consideration, but this general rule must be interpreted as modified by the provision of article
1479 above referred to, which applies to "a promise to buy and sell" specifically. As already
stated, this rule requires that a promise to sell to be valid must be supported by a consideration
distinct from the price.
Which hold that an offer, once accepted, cannot be withdrawn, regardless of whether it is
supported or not by a consideration. But we are prevented from applying them in view of the
specific provision embodied in article 1479. While under the "offer of option" in question
appellant has assumed a clear obligation to sell its barge to appellee and the option has been
exercised in accordance with its terms, and there appears to be no valid or justifiable reason for
appellant to withdraw its offer. Our imperative duty is to apply it unless modified by Congress.

Wherefore, the decision appealed from is reversed, without pronouncement as to costs.

7. Cronico vs. J.M Tuazon and Co. Inc., 78 SCRA 331

Facts
Appellant J. M. Tuason & Co. Inc. hereinafter referred to as appellant company was the
registered owner of Lot No. 22, Block 461, Sta. Mesa Heights Subdivision, located at the
Northwestern corner of Quezon Boulevard and Gregorio Araneta, Quezon City and embraced
by Transfer Certificate of Title No. 49235 of the registry of Deeds of said city. In March, 1962,
plaintiff Florencia Cronico offered to buy the lot from the appellant company with the help of
Mary E. Venturanza. They personally talked to Benjamin F. Bautista, Manager of the Real
Estate Department of Gregorio Araneta, Inc. the appellant company's attorney-in-fact, proposing
to buy Lot No. 22. She was required to present proofs to show her rights to the lot. On March 8,
1962, Florencia Cronico exhibited certain documents showing her priority rights to buy the lot.

Issue
Whether or not JM Tuason’s promise to sell the lot to Cronico has a consideration separate
from the selling price of said lot and thus binding upon the promissory to comply with such
promise.

Court Ruling/ Held

No, the promise of the respondent company to sell the lot in question to the
petitioner,Florencia Cronico has no consideration separate from the selling price of said lot.
It appears that the Compromise Agreement upon which Cronico predicates her right tobuy
the lot in question has been rescinded and set aside.In order that a unilateral promise may
be binding upon the promisor, Article 1479, CivilCode of the Philippines, requires the
concurrence of the condition that the promise be“supported by a consideration distinct from
the price. Accordingly, the promisee can notcompel the promisor to comply with the
promise, unless the former establishes the existence of said distinct consideration. The
promisee has the burden of proving such consideration.

8. Surigao vs. Mineral Reservation Board vs. Cloribel 24 SCRA 898 

Facts

Issue

Court Ruling/ Held

 
        

9. Standard Oil vs. Arenas 19 Phil 363

Standard Oil vs. Arenas
G.R. No. L-5921, July 25, 1911
ARELLANO, C.J.

FACTS: 
 On December 5, 1908, Vicente Sixto Villanueva assumed as a surety, among other
parties, to the obligation of Arenas & Co. to pay The Standard Oil Company of New
York, the sum of P3,305.76, at three months from date, with interest at P1 per month.
The Standard Oil Company then sued the five debtors for their failure to comply with the
same.
 In August 28, 1909, said debtors were ordered to pay, jointly and severally, the amount
in question, with interest.
 Elisa Villanueva, spouse of Vicente, then appeared and petitioned for the reopening of
the trial alleging insanity on the part of his husband thereby invalidating his act as surety
to the bond in question.
 The said court ruled that on the execution of the bond in question, Vicente understood
perfectly well the nature and consequences of his action; hence, the judgment originally
petitioned against was to be executed.
 Unconvinced, Elisa filed an appeal to the Supreme Court.

ISSUE: 
Whether or not Vicente Villanueva may be exempted from the judgment appealed from on
account of his alleged mental incapacity. 

RULING:
NO.
 The Court ruled that, in the absence of any direct and specific evidence pertaining to the mental
condition of Vicente Villanueva affecting his action on December 5, 1908, his mental state due
to monomania is not enough proof to exempt him from his liability as surety to the bond in
question.

10. Mercado vs. Espiritu 37 Phil 215

Mercado vs. Espiritu
G.R. No. L-11872, December 1, 1917
TORRES, J.

FACTS: 
Mercado vs. Espiritu is a case wherein there is a contract made by Luis Espiritu and the heirs of
his sisters named Margarita Mercado, Josepha and Domingo Mercado, wherein they pretended
to be at the legal age in order to lend their consent into the contract of sale of the land which
they inherited from their Margarita Mercado. The siblings Josepha, and Domingo Mercado
wanted and sought for the annulment of contract stating that they were not yet at the legal age
during the time of perfection of contract.
Domingo and Josefa Mercado, through counsel, filed a lawsuit against Luis Espiritu in the Court
of First Instance of Bulacan, but the latter died soon after, thus the complaint was changed and
directed to Luis Espiritu in his capacity as Administrator of Luis Espiritu’s state. 

ISSUE: 
Whether or not the deed of sale is valid when the minors presented themselves that they were
of legal age. 

RULING: 
YES. The court declared that the contract of sale was VALID, even if it were made and entered
into by minors, who pretended to be of legal age. The court stated that they will not be permitted
to excuse themselves from the fulfilment of the obligations contracted by them, or to have them
annulled. 

Accordingly, the Court ruled pursuant to the provisions of law on estoppel and Rule 123, Section
6 paragraph A which states that “whenever a party has, by its own declaration, act or omission,
intentionally and deliberately led another party to believe a particular thing to be true, and to act
upon such belief, he cannot, in any litigation arising out of such declaration, cannot be permitted
to falsify it.”

11. Madrigal and Co. vs. Stevenson and Co. 15 Phil 38

Madrigal and Co. vs. Stevenson and Co.
G.R. No. L-6106-07, April 18, 1958
PADILLA, J.

12. Tang vs. CA 90 SCRA 226

TANG vs. CA

G.R. No. L-48563 May 25, 1979

ABAD SANTOS, J.:

Facts:
On September 25, 1965, Lee See Guat who can only speak Chinese language applied
for an insurance on her life for P60,000 with the respondent Company. The application is in the
form of the English language. Vicente E. Tang is the beneficiary of the insurance. On April 20,
1966. Lee See Guat died of lung cancer then Vicente E. Tang wants to claim the insurance,
however the company refused to pay on the ground that the insured was guilty of concealment
and misrepresentation at the time she applied for the two policies.

Issue:
Whether Art. 1332 of the Civil Code of the Philippines is applicable in this case?
Ruling:
 
No.
The  article 1332 of the Civil Code of the Philippines does not apply in this case since the
respondent company was under no obligation to prove that the terms of the insurance contracts
were fully explained to the other party. Even if we were to say that the insurer is the one seeking
the performance of the contracts by avoiding paying the claim, it has to be noted as stated
above that there has been no imputation of mistake or fraud by the illiterate insured whose
personality is represented by her beneficiary the petitioner herein.
 

13. Martinez vs. CA 56 SCRA 647

Benjamin P. Martinez vs. CA
GR No.
168827, 2007-04-13

FACTS
Dean Dongui was a teacher at the Tubao National High School, La Union. Petitioner Benjamin
Martinez was the husband of Dean's co-teacher, Lilibeth Martinez. Petitioner eked out a living
as a tricycle driver.
On October 28, 1998, Dean and his wife Freda filed a complaint for damages against the
spouses Martinez in the Municipal Circuit Trial Court (MCTC) of Tubao, La Union. They alleged
that in March 1998, petitioner, a suitor of Elvisa Basallo, had been peddling false reports that
Dean and Elvisa had illicit relations he even told Freda that Elvisa was Dean's mistress. This led
to a quarrel between Dean and Freda, and the latter was hospitalized for her heart ailment.
Dean requested Lilibeth to stop her husband from spreading lies, and she replied that
Elvisa had been her husband's mistress. They prayed that they be awarded moral and
exemplary damages and litigation fees in the total amount of P100,000.00.The case was
docketed as Civil Case No. 226.
For her part, Elvisa also filed a complaint against the spouses Martinez in the MCTC of Tubao
for damages anchored on Article 26 of the New Civil Code.
Dean went to the Tubao Credit Cooperative (TCC) office to pick up the dividend certificate of his
wife who was a member of the cooperative. He left the building and walked to his car which was
parked in front.
Dean was about a step away from an L-300 van which was parked in front of the building when
petitioner, armed with a bolo, suddenly emerged from behind the vehicle and stabbed him on
the left breast. Dean instantly moved backward and saw his assailant.
Dean fled to the bank office and was able to gain entry into the bank. Petitioner ran after him
and upon cornering him, tried to stab him again. Dean was able to parry the blow with his right
hand, and the bolo hit him on the right elbow. Dean fell to the floor and tried to stand up, but
petitioner stabbed him anew on his left breast.
Meantime, SPO1 Henry Sulatre was at the Tubao Police Station, about 100 meters away.
He was informed that a fight was going on in the bank. He rushed to the place on board the
police car.
He brought petitioner to the police station. On the way, they passed by the loading area of
tricycles, about 40 meters away from the police station.
Petitioner shouted:
I stabbed him, he is just a visitor so he should not act like a king here in Tubao
SPO1 Sulatre placed Benjamin in jail. Benjamin kept on shouting:
"Napatay kon, napatay kon
In the meantime
PO3 Valenzuela brought Dean to the Doña Gregoria Memorial Hospital in Agoo, La Union. The
victim was transferred to the Ilocos Regional Hospital (IRH) in San Fernando, La Union where
Dean was examined and operated
Dean sustained two stab wounds
On February 7, 1999, Dean gave a sworn statement to SPO1 Sulatre.
On March 10, 1999, SPO1 Sulatre filed a criminal complaint for frustrated murder against
petitioner in the MCTC
On September 13, 2000 the Provincial Prosecutor of La Union indicted Benjamin for frustrated
murder before the Regional Trial Court
Petitioner declared that he merely defended himself against Dean's assault. Dean was so
jealous of him because his mistress, Elvisa, had also been his mistress.
Petitioner declared that the criminal charge against him was Dean's concoction, and intended
solely to harass him.
He parked his tricycle in front of the building on the left side of the railing going to the entrance
of the cooperative.
On his way, he met his 82-year-old uncle, who was also on his way to the cooperative to update
his passbook because he was intending to apply for a loan.
Dean thought that he was blocking his way and shouted invectives at him and his uncle
Dean kept attacking him, forcing him to move backward through the railing and towards his
tricycle
He stabbed Dean on his right elbow.
He entered the office and stood by the entrance door to see if Dean would get a weapon. Dean
continued hurling invectives at him but was later pacified by Patricio Alterado, an... employee of
the cooperative.
When Barangay Captain he surrendered, along with his bolo. 
He never boasted on the way to the police station that he had killed Dean.

ISSUE
Petitioner's argument that he should be acquitted because the criminal complaint against him
was not supported by the victim's sworn statement or by an affidavit
Petitioner next argues that should he be convicted of any crime, it should be of less serious
physical injuries only, absence the element of intent to kill.

RULING 
The petition is denied for lack of merit.
Petitioner is guilty of frustrated murder under Article 248 in relation to Article 6, first paragraph of
the Revised Penal Code which reads
For voluntary surrender to be appreciated, the following requisites should be present: 
(1) the offender has not been actually arrested;
 (2) the offender surrendered himself to a person in authority or the latter's agent; and 
(3) the surrender was voluntary. 
The surrender must be spontaneous, made in such a manner that it shows the interest of the
accused to surrender unconditionally to the authorities, either because he acknowledged his
guilt or he wishes to save them the trouble and expenses that would necessarily be incurred in
the search and capture.
In the case at bar, SPO1 Salutre testified that petitioner did not voluntarily surrender but was
forcibly apprehended by Barangay Captain
We agree with the trial court that the qualifying circumstance of evident premeditation has not
been adequately shown. To properly appreciate the same
The trial court awarded Dean the amount of P92,000.00 representing his hospitalization and
medical expenses which was increased by the CA to P92,715.68.
IN LIGHT OF ALL THE FOREGOING, the assailed Decision is hereby AFFIRMED WITH
MODIFICATION. Petitioner is hereby found guilty beyond reasonable doubt of Frustrated
Murder under Article 248 in relation to Article 6 prision mayor to eclusion temporal in its medium
period, as maximum.

14. Luna vs. Linatoc 74 SCRA 1

AGUSTIN DE LUNA vs. JOSE LINATOC
G.R. No. L-48403, October 28, 1942
BOCOBO, J.:

FACTS
Agustin De luna's wife sold a portion of their conjugal property to Jose Linatoc. The said land is
Agustin's portion of the conjugal property. It appears that the sale were made by Agustin's wife
with his knowledge and consent, as evidenced by the deed (Exhibit I). The sale was prohibited
by Article 1432 of the Civil Code because partitioning the conjugal property during marriage can
only be done if there was a judicial separation of property, or else it will be illegal or void. The
sale can only be valid if the land was sold under the name of the conjugal partnership and not of
the husband only. Agustin Del Luna assail the validity of the sale to Jose Linatoc, claiming that
they do not know of the said prohibition.

ISSUE
Whether or not the contract of sale is annullable due to a mistake of law.

RULING 
No. 

Mistake of law does not make a contract voidable because ignorance of the law does not
excuse anyone from its compliance (Art. 2, CC; 8 Manresa, 646, 2d ed.). That the petitioners did
not know the prohibition against partition of the conjugal partnership property during marriage
(Art. 1432, Civil Code) is no valid reason why they should ask for the annulment of the sales
made. Moreover, there is the time-honoured legal maxim that no man can take advantage of his
own wrong. To repudiate the sales in question, petitioners are setting up their own wrongful act
of partitioning their conjugal property, which violated Art. 1432 of the Civil Code. The prohibition
in said article affects public policy, as it is designed to protect creditors of the conjugal
partnership and other third persons. Therefore, petitioners shall not be allowed to rest their
cause of action to recover the lands sold, upon the illegality of the partition which they attempted
to make. Otherwise, they would profit by their own unlawful act.

15. Vales vs. Luna 35 Phil 769

JOSE VALES, vs. SIMEON A. VILLA, FELIPE S. SILVESTRE, and MARIA GUIA GARCIA
G.R. No. 10028 December 16, 1916
Moreland, J.

FACTS:
It appears that the defendant Felipa Silvestre is a widow, 70 years of age, and is the aunt of the
defendant Maria Guia Garcia, wife of the defendant Simeon A. Villa. In 1904, the plaintiff owned
several properties while being in debt with the defendant Felipe Silvestre in the sum of P20,000.
During the same year he executed to her a conveyance of his properties in consideration of the
debt, the conveyance contains a clause, giving the vendor the right to repurchase the premises
within one year from the date of the reconveyance. 

Between the two acts there is no difference in law. But when his sense, judgment, and his will
rebel and he refuses absolutely to act as requested, but is nevertheless overcome by force or
intimidation to such an extent that he becomes a mere automation and acts mechanically only,
a new element enters, namely, a disappearance of the personality of the actor. 

ISSUE: Whether or not a transfer made by undue influence is sufficient to set aside a
conveyance.

RULING: NO, There is no question of error or violence in this case; and we have already
disposed of that of deceit. Intimidation resulting from the fear of losing his property, if he did not
comply with defendants’ demands, is the element relied on.

Article 1265 of the Civil Code tells us when duress exists: “Consent given by error, under
violence, by intimidation, or deceit shall be void.” Article 1267 provides that “violence exists
when, in order to exact consent, irresistible force is used;” and the “intimidation exists when one
of the contracting parties is inspired with a reasonable and well-grounded fear of suffering an
imminent and serious injury to his person or property. . . .” Article 1268 declares the effect of
violence and intimidation on the contract. It provides

16. Sabalvaro vs. Erlanger and Galinger 64 SCRA 588

VICENTE SABALVARO v. ERLANGER & GALINGER
G.R. No. 43045, August 17, 1937
MORELAND, J.

FACTS: The defendant corporation accepted the services of the plaintiff, as its employee, on
April 16, 1920. A few months after the plaintiff had entered said defendant's service the record
is silent as to the said date the defendant Feldstein, who was the vice-president thereof, offered
to sell him the share which had originally been issued in the name of Serapio Estabaya and
transferred by the latter to the corporation, for economic reasons. 

When the plaintiff voluntarily separated from the service of the defendant corporation on
February 17m 1933, he asked the latter and the officers thereof to purchase his 10 shares in
question as they previously purchased those of other employees. He likewise asked them to
pay him 7 per cent of the value of his said shares, as interest, during the year 1932

ISSUE:
Whether or not that the defendant corporation or its officer, who are the other defendants, under
obligation or not to purchase from the plaintiff his ten shares of stock in the corporation, after the
plaintiff separation from said defendant corporation.

RULLING/HELD:

No, the 7 shares which plaintif acquired were made with conditions different from the 3 shares
he acquired. A contract should not be construed as including things and cases different from
those with respect with the persons interested intended to contract (article 1283, Civil code). It
should be borne in mind that said shares  were not purchased by the plaintiff with his own
money but with the dividend or profits earned by the same. The plaintiff, in the agreement
executed in 1932, expressly and formally renounced the stipulated interest if 7 percent per
annum corresponding to the said year( January 1- December 31), thereby relieving the
defendant corporation of the obligation to pay it to him. The argument that the plaintiff signed
the document in question for fear of being dismissed from the corporation, which fear  was
unfounded because it does not appear  that he has been intimidated by somebody, and does
not proved that his consent was obtained by means of intimidation.

17. E. Berg. Vs. NCBNY 102 Phil. 309  (PAKIPARAPHRASE PO HEHE)

 Facts
o The Red Star Stores, Inc. was owed $19,956.75 to the National City Bank
of New York, Manila Branch, hereinafter referred to as the Bank, in 1941,
shortly before the commencement of the war. Ernest Berg, also known as
plaintiff, and his brother, Alfred Berg, both guaranteed this duty. The Bank
of Taiwan required Red Star Stores, Inc. to liquidate its commitment
under the Japanese occupation, and plaintiff complied by paying the debt
in full.
 Issue
o Where the plaintiff and defendant had previously entered into a
compromise agreement, whereby the former agreed to pay his
indebtedness provided the latter forego the payment of the interest which
compromise was arrived at when there was still uncertainty as to the
validity of payments made to the Bank of Taiwan of prewar obligations
and the compromise was entered into avoid "the provocation of a suit" "
which defendant was then contemplating to take against the plaintiff and
his brother in the belief that the payment made to the Bank of Taiwan was
not valid.
o To settle a controversy.
o Threat to bring action to enforce collection is not duress.
o Absence of intimidation; case at bar.
 Court Ruling/ Held
o Yes, that being a compromise, it is binding upon the parties and as such it
has "the same authority as re judicata" (ARTICLE 1809. Any partner shall
 have the right to a formal account as to partnership affairs: (1) If he is
wrongfully excluded from the partnership business or possession of its
property by his co-partners; (2) If the right exists under the terms of any
agreement; (3) As provided by article 1807; (4) Whenever other
circumstances render it just and reasonable.)  and as such it has "the
same authority as res judicata (ARTICLE 1816. All partners, including
industrial ones, shall be liable pro rata with all their property and after all
the partnership assets have been exhausted, for the contracts which may
be entered into in the name and for the account of the partnership, under
its signature and by a person authorized to act for the partnership.
However, any partner may enter into a separate obligation to perform a
partnership contract.)
o As a rule, a compromise is entered into not because it settles a valid
claim but because it settles a controversy between the parties.
o It is a practice followed not only by banks but even by individual, to
demand payment of their accounts with the threat that upon failure to do
so, an action would be instituted in court. That such a threat is proper
within the realm of the law as a means to enforce collection, and it cannot
constitute duress even if the claim proves to be unfounded so long as the
creditor believes that it was his right to do so.
o As warranted by the facts and circumstances established in the case at
bar, the compromise agreement has been entered into voluntarily and, as
such, is valid and binding, since under law intimidation can only exist
"when one of the contracting parties is inspired with a reasonable and
well grounded fear of suffering and imminent and serious injury to his
person or property" (Article 1267. When the service has become so
difficult as to be manifestly beyond the contemplation of the parties, the
obligor may also be released therefrom, in whole or in part. The general
rule is that impossibility of performance releases the obligor.)

18. Cove vs. Fernandez Deza 42 Phil. 596

PASCUAL COSO vs. FERMINA FERNANDEZ DEZA, ET AL
G.R. No. L-16763 December 22, 1921
OSTRAND, J

FACTS: 

The evidence shows that the testator, a married man and resident of the Philippine Islands,
became acquainted with Rosario Lopez in Spain in 1898 and that he had illicit returns with her
for many years thereafter. After his return to the Philippines she followed him, arriving in Manila
in February, 1918, and remained in close communication with him until his death in February,
1919. There is no doubt that she exercised some influence over him and the only question for
our determination is whether this influence was of such a character as to vitiate the will.

ISSUE:
Whether the exercise influenced by Lopez to the testator contemplates the will to be nulled and
vitiated. 

HELD/RULING:
No. 
Mere general or reasonable influence over a testator is not sufficient to invalidate a will; to have
that effect the influence must be "undue." The rule as to what constitutes "undue influence" has
been variously stated, but the substance of the different statements is that, to be sufficient to
avoid a will, the influence exerted must be of a kind that so overpowers and subjugates the mind
of the testator as to destroy his free agency and make his express the will of another, rather
than his own.

19. Martinez vs. Hongkong and Shanghai bank 15 Phil 252

MARTINEZ v. HONGKONG AND SHANGHAI BANK
G.R. No. L-5496,  February 19, 1910
MORELAND, J.:

FACTS:
 
 This is an action to set aside a contract on the ground that plaintiff’s consent thereto was
given under duress and undue influence. It was alleged that Mercedes Martinez
(plaintiff) agreed to convey several properties to Aldecoa & Co and HSBC as a
settlement of their claims against her and her husband, Alejandro Macleod, the former
manager of Aldecoa & Co who fled the country. During the trial, it was shown that HSBC
instituted a civil action against Macleod and others for the recovery of certain shares of
stock and for damages, basing its right to recover upon alleged criminal misconduct of
Macleod in his management of the firm’s affairs. During the period of negotiations,
HSBC made representations to her which were concurred in by her lawyers, that if she
agreed to the requirements of the defendants, the civil suit against herself and her
husband would be dismissed and the criminal charges against the latter were withdrawn.
However, if she refused, her husband must either spend the rest of his life abroad or be
criminally prosecuted.

ISSUE:

 Whether or not the contract may be invalidated on grounds of duress

RULING:

 No, the contract may not be invalidated because there is no duress in the present case.
Article 1335 of the Civil Code in its last paragraph provides that “a threat to enforce
one’s claim through competent authority, if the claim is just or legal does not vitiate
consent”. In order that this contract can be annulled it must be shown that the plaintiff
never gave her consent to the execution thereof. It is, however, necessary to distinguish
between real duress and the motive which is present when one gives his consent
reluctantly. A contract is valid even though one of the parties entered into it against his
wishes and desires or even against his better judgment. Contracts are also valid even
though they are entered into by one of the parties without hope of advantage or profit. A
contract whereby reparation is made by one party for injuries which he has willfully
inflicted upon another is one which from its inherent nature is entered into reluctantly by
the party making the reparation. He is confronted with a situation in which he finds the
necessity of making reparation or of taking the consequences, civil or criminal, of his
 unlawful acts. He makes the contract of reparation with extreme reluctance and only by
the compelling force of the punishment threatened. Nevertheless, such a contract is
binding and enforceable. Hence, the petition is dismissed.

20. Songco vs. Sellner 37 Phil 254

 
LAMBERTO SONGCO VS. GEORGE SELLNER
G.R. No. L-11513       December 4, 1917
STREET, J.
TOPIC: CONSENT
 
FACTS:
George C. Sellner, was the owner of a farm at Floridablanca, Pampanga, which was
contiguous to a farm owned by the plaintiff Lamberto Songco. Both properties had a
considerable quantity of sugar cane ready to be cut. Sellner wanted to mill his cane at
Dinalupijan, but could not get right of way over Songco's land for converting his own cane to the
central in Pampanga and that the owners of the central could not promise they would take it from
Lamberto Songco's land. George C. Sellner bought Songco's cane for P12,000 and executed
therefor three promissory notes of P4,000 each. The defendant appealed from a judgement
rendered in favor of the plaintiff, and the case has been adjourned.
 
ISSUE:
Whether or not there is a difference between giving an honest opinion and making a false
representation as to what one's real opinion is.
 
RULING:
Yes.

An attachment against the defendant was wrongfully sued out. The court awarded damages to the
defendant equivalent to the amount actually paid by him in procuring the dissolution of the
attachment. We think the court committed no error in refusing to award damages, as such
damages were remote and speculative.
 
From what has been said it follows that the judgment of the court below must be affirmed, with
costs against the appellant. So ordered.