Archive for February, 2014


CASE 2014-0010: HEIRS OF DR. MARIANO FAVIS, SR., represented by their co-heirs and Attorneys-in-Fact MERCEDES A. FAVIS and NELLY FAVIS- VILLAFUERTE, Petitioners, -versus- JUANA GONZALES, her son MARIANO G. FAVIS, MA. THERESA JOANA D. FAVIS, JAMES MARK D. FAVIS, all minors represented herein (GR. No. 185922, 15 JANUARY 2014, PEREZ, J.) (BRIEF TITLE: HEIRS OF DR. FAVIS SR. VS. GONZALES ET AL.)

 

DISPOSITIVE:

 

“WHEREFORE, the Decision of the Court of Appeals 1s REVERSED and SET ASIDE and the Judgment of the Regional Trial Court of Vigan, Ilocos Sur, Branch 20 is AFFIRMED.

 

SO ORDERED.”

 

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SCD-2014-0010-JAN 2014-FAVIS

CASE 2014-0009: UNION BANK OF THE  PHILIPPINES, Petitioner – versus – DEVELOPMENT BANK OF THE PHILIPPINES, Respondent (G.R. NO. 191555, 20 JANUARY 2014, PERLAS-BERNABE, JJ.) (BRIEF TITLE: UNION BANK VS. DBP)

 

DISPOSITIVE:

 

“WHEREFORE, the petition is DENIED. The Decision dated November 3, 2009 and Resolution dated February 26, 2010 of the Court of Appeals in CA-G.R. SP No. 93833 are hereby AFFIRMED.”

 

SO ORDERED.

 

SUBJECT/DOCTRINES:

 

WHAT IS LEGAL COMPENSATION?

 

LEGAL COMPENSATION IS DEFINED AS A MODE OF EXTINGUISHING OBLIGATIONS WHEREBY TWO PERSONS IN THEIR CAPACITY AS PRINCIPALS ARE MUTUAL DEBTORS AND CREDITORS OF EACH OTHER WITH RESPECT TO EQUALLY LIQUIDATED AND DEMANDABLE OBLIGATIONS TO WHICH NO RETENTION OR CONTROVERSY HAS BEEN TIMELY COMMENCED AND COMMUNICATED BY THIRD PARTIES.
 WHAT ARE THE REQUISITES OF LEGAL COMPENSATION?

 

 (1) THAT EACH ONE OF THE OBLIGORS BE BOUND PRINCIPALLY, AND THAT HE  BE AT THE SAME TIME A PRINCIPAL CREDITOR OF THE OTHER; 

 

(2) THAT BOTH DEBTS CONSIST IN A SUM OF MONEY, OR IF THE THINGS DUE  ARE CONSUMABLE, THEY BE OF THE SAME KIND, AND ALSO OF THE SAME  QUALITY IF THE LATTER HAS BEEN STATED; 

 

(3) THAT THE TWO DEBTS BE DUE; 

 

(4) THAT THEY BE LIQUIDATED AND DEMANDABLE;  

 

(5) THAT OVER NEITHER OF THEM THERE BE ANY RETENTION OR CONTROVERSY,  COMMENCED BY THIRD PERSONS AND COMMUNICATED IN DUE TIME TO THE  DEBTOR. (EMPHASES AND UNDERSCORING SUPPLIED)  

 

HOW DOES LEGAL COMPENSATION OPERATES?

 

WHEN  ALL THE REQUISITES MENTIONED IN ARTICLE 1279 ARE PRESENT, COMPENSATION TAKES EFFECT BY OPERATION OF LAW, AND EXTINGUISHES BOTH DEBTS TO THE CONCURRENT AMOUNT, EVEN THOUGH THE CREDITORS AND DEBTORS ARE NOT AWARE OF THE COMPENSATION.

 

CAN UNION BANK CLAIM LEGAL COMPENSATION: THAT IS –  IT HAS NO MORE OBLIGATION TO RETURN FUNDS TO DBP SINCE DBP IS ALSO OBLIGATED TO PAY UNION BANK CERTAIN LEASE PAYMENTS?

 

NO.

 

DBP’S ASSUMED OBLIGATIONS TO UNION BANK FOR REMITTANCE OF THE LEASE PAYMENTS ARE AS DECIDED IN A PREVIOUS CASE CONTINGENT ON THE PRIOR PAYMENT THEREOF BY FOODMASTERS’ TO DBP. SUCH COURT DECISION HAS ALREADY BECOME FINAL.

 

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SCD-2014-0009-JAN 2014-UNION BANK

CASE 2014-0014: THE PRESIDENT OF THE CHURCH OF JESUS CHRIST OF LATTER DAY SAINTS, Petitioner,  – versus – BTL CONSTRUCTION CORPORATION, Respondent (G.R. NO. 176439); BTL CONSTRUCTION CORPORATION, Petitioner, – versus -THE PRESIDENT OF THE MANILA MISSION OF THE CHURCH OF JESUS CHRIST OF LATTER DAY SAINTS and BPI-MS INSURANCE CORPORATION, Respondents. (G.R. NO. 176718) (15 JANUARY 2014, PERLAS-BERNABE,  J.) (BRIEF TITLE: CHURCH OF JCOLDS VS. BTL CONSTRUCTION)

 

DISPOSITIVE:

 

WHEREFORE, the petition in G.R. No. 176439 is PARTLY GRANTED, while the petition in G.R. No. 176718 is DENIED. The Decision dated August 15, 2006 and Resolution dated January 26, 2007 of the Court of Appeals (CA) m CA-G.R. SP No. 84068 are hereby MODIFIED as follows:

 

(a) COJCOLDS is ORDERED to pay BTL the amount of Pl,612,017.74 representing the unpaid balance of 98% of the contract price, inclusive of the 10% retention money;

 

(b) BTL is ORDERED to pay COJCOLDS the amounts of Pl,851,280.00 as liquidated damages,

 

(c) P526,400.00 as cost overrun, and P300,533.49 as reimbursement for the overpayment in the works taken under Change Order Nos. 1 to 12.

 

(d)Each party shall bear its own costs.

 

SO ORDERED.”

 

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SCD-2014-0008-JAN 2014-BTL CONSTRUCTION