CASE 2016-0068: NATIONAL POWER CORPORATION VERSUS SPOUSES CONCHITA MALAPASCUA-MALIJAN and LAZARO MALIJAN, (G.R. No. 211731, 7 DECEMBER 2016, PERALTA, J.); CONCHITA MALAPASCUA-MALIJAN and HEIRS OF LAZARO MALIJAN VERSUS NATIONAL POWER CORPORATION (G.R. No. 211818, 7 DECEMBER 2016, PERALTA, J.) (SUBJECTS: EXPROPRIATION; JUST COMPENSATION; LEGAL RATE OF INTEREST; ATTORNEY’S FEES; EXEMPLARY DAMAGES (BRIEF TITLE: NPC VS. SPOUSES MALIJAN ET AL)
DISPOSITIVE:
“WHEREFORE, the Petition for Review on Certiorari under Rule 45 of the Rules of Court dated May 11, 2014 of Conchita Malapascua-Malij an and Heirs of Lazaro Malijan in G.R. No. 211818 is DENIED for lack of merit, while the Petition for Review on Certiorari under Rule 45 dated April 21, 2014 of the National Power Corporation is GRANTED. Consequently, the Decision dated June 13, 2012 of the Court of Appeals and its subsequent Resolution dated March 12, 2014, reversing the Decision dated February 22, 2008 of the Regional Trial Court, Branch 6, Tanauan City, Batangas, are AFFIRMED with the modification that the award of exemplary damages and attorney’s fees is DELETED.
SO ORDERED.”
SUBJECTS/DOCTRINES/DIGEST:
ON LEGAL RATE OF INTEREST
“Recently, the BSP Monetary Board (ESP-MB), in its Resolution No. 796 dated May 16, 2013, approved the amendment of Section 2 of Circular No. 905, Series of 1982, and accordingly, issued Circular No. 799, Series of2013, effective July 1, 2013, the pertinent portion of which reads:
The Monetary Board, in its Resolution No. 796 dated 16 May 2013, approved the following revisions governing the rate of interest in the absence of stipulation in loan contracts, thereby amending Section 2 of Circular No. 905, Series of 1982:
Section 1. The rate of interest for the loan or forbearance of any money, goods or credits and the rate allowed in judgments, in the absence of an express contract as to such rate of interest, shall be six percent (6%) per annum.
Section 2. In view of the above, Subsection X305.1 of the Manual of Regulations for Banks and Sections 4305Q.1, 4305S.3 and 4303P.1 of the Manual of Regulations for Non-Bank Financial Institutions are hereby amended accordingly.
This Circular shall take effect on 01 July 2013.
Accordingly, the prevailing interest rate for loans and forbearance of money is six percent (6%) per annum, in the absence of an express contract as to such rate of interest.”
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ON EXEMPLARY DAMAGES
“Under Article 2229 of the Civil Code, “[ e ]xemplary or corrective damages are imposed, by way of example or correction for the public good, in addition to the moral, temperate, liquidated or compensatory damages.” As this court has stated in the past: “Exemplary damages are designed by our civil law to permit the courts to reshape behaviour that is socially deleterious in its consequence by creating negative incentives or deterrents against such behaviour.””
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ON ATTORNEY’S FEES
The award of attorney’s fees is also unwarranted because of the lack of factual and legal justification. An award of attorney’s fees has always been the exception rather than the rule. To start with, attorney’s fees are not awarded every time a party prevails in a suit.37 Nor should an adverse decision ipso facto justify an award of attorney’s fees to the winning party.38 The policy of the Court is that no premium should be placed on the right to litigate.39 Too, such fees, as part of damages, are assessed only in the instances specified in Article 220840 of the Civil Code. Indeed, attorney’s fees are in the nature of actual damages.41 But even when a claimant is compelled to litigate with third persons or to incur expenses to protect his rights, attorney’s fees may still be withheld where no sufficient showing of bad faith could be reflected in a party’s persistence in a suit other than an erroneous conviction of the righteousness of his cause.42 And lastly, the trial court must make express findings of fact and law that would bring the suit within the exception. What this demands is that the factual, legal or equitable justifications for the award must be set forth not only in the fallo but also in the text of the decision, or else, the award should be thrown out for being speculative and conjectural.”
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