Doctrine: Human Relations

Under Article 2219 of the Civil Code, moral damages are recoverable for acts
referred to in Article 21 of the Civil Code.   "Abuse of rights."

Spouses Serfino vs. Far East Bank and Trust Company (now BPI)
G.R. No. 171845, October 10, 2012
J. Brion

Facts:

Petitioner spouses Godfrey and Gerardina Serfino and spouses Domingo and
Magdalena Cortez are parties in a compromise judgment in an action for collection of
sum of money where spouses Cortez are the adverse party. Under the approved
compromise agreement, Magdalena obliged herself to pay in full the judgment debt out
of her retirement benefits from the GSIS to satisfy the debt.

Unfortunately, no payment was made as promised. Instead, Godfrey discovered

that Magdalena deposited her retirement benefits in the savings account of her
daughter-in-law, Grace Cortez, with the respondent bank.

The spouses Serfino filed an action for recovery of money on deposit and the
payment of damage against the spouses Cortez, Grace and her husband, Dante
Cortez, and respondent bank.The trial court ruled, inter alia, absolving respondent bank
from any liability for allowing Grace to withdraw the deposit. The trial court declared that
respondent bank was not a party to the compromise judgment and thus not chargeable
with notice of the parties’ agreement, as there was no valid court order or processes
requiring it to withhold payment of the deposit. Given the nature of bank deposits, the
bank was primarily bound by its contract of loan with Grace. There was, therefore, no
legal justification for the bank to refuse payment of the account, notwithstanding the
claim of the spouses Serfino as stated in their three letters. Petitioner appealed the
ruling of the trial court to Supreme Court arguing, among others, that respondent bank
committed an actionable wrong that entitles them to the payment of actual and moral by
allowing Grace to withdraw the deposit that is due them under the compromise
judgment.

Issue:

Whether or not respondent bank committed an actionable wrong that entitle

petitioners for payment moral damages.

Held:

No, the respondent bank did not commit an actionable wrong. Hence, they were
not liable for the payment of moral damages to petitioners.

Under Article 2219 of the Civil Code, moral damages are recoverable for acts
referred to in Article 21 of the Civil Code.  Article 21 of the Civil Code, in conjunction with
Article 19 of the Civil Code, is part of the cause of action known in this jurisdiction as
"abuse of rights." The elements of abuse of rights are: (a) there is a legal right or duty;
(b) exercised in bad faith; and (c) for the sole intent of prejudicing or injuring another.

Here, the spouses Serfino claim that respondent bank committed an actionable
wrong that entitles them to the payment of actual and moral damages by allowing Grace
to withdraw the deposit that is due them under the compromise judgment. They
petitioners also invoked American common law that imposes a duty upon a bank
receiving a notice of adverse claim to the fund in a depositor’s account to freeze the
account for a reasonable length of time, sufficient to allow the adverse claimant to
institute legal proceedings to enforce his right to the fund.

In the absence of a law or a rule binding on the Court, it has no option but to
uphold the existing policy that recognizes the fiduciary nature of banking. It likewise
rejects the adoption of a judicially-imposed rule giving third parties with unverified claims
against the deposit of another a better right over the deposit.

As current laws provide, the bank’s contractual relations are with its depositor,
not with the third party; a bank is under obligation to treat the accounts of its depositors
with meticulous care and always to have in mind the fiduciary nature of its relationship
with them. In the absence of any positive duty of the bank to an adverse claimant, there
could be no breach that entitles the latter to moral damages.
Doctrine: Human Relations

A party’s refusal to abide by a court order enjoining him from doing an act,
otherwise lawful, constitutes an abuse and an unlawful exercise of right.

Villanueva vs. Rosqueta

G.R. No. 180764, January 19, 2010
J. Abad

Facts:

Respondent Emma M. Rosqueta, formerly Deputy Commissioner of the Revenue

Collection and Monitoring Group of the Bureau of Customs, tendered her courtesy
resignation from his post. Five months later, she withdrew her resignation, claiming that
she enjoyed security of tenure and that she had resigned against her will on orders of
her superior.

Respondent filed a petition for prohibition, quo warranto, and injunction against
petitioner Titus B. Villanueva, then Commissioner of Customs, the Secretary of Finance,
and Valera with the RTC of Manila. The RTC issued a writ of preliminary injunction
enjoining Villanueva and the Finance Secretary from implementing Valera’s
appointment.

On February 28, 2002 respondent filed a complaint for damages before the RTC
of QC against petitioner alleging that the latter maliciously excluded her from the
centennial anniversary memorabilla of the BOC.

But the RTC dismissed respondent’s complaint stating that petitioner committed
no wrong and incurred no omission that entitled her to damages. But the CA revered the
RTC’s decision, holding instead that petitioner’s refusal to comply with the preliminary
injunction order issued in the quo warranto case earned for respondent the right to
recover moral damages.

Issue:

Whether or not petitioner is liable for damages when he ignored the preliminary
injunction order issued by the RTC in the quo warranto case in favor of the respondent.

Held:

Yes, petitioner is liable for damages when he ignored the preliminary injunction
order issued by the RTC in the quo warranto case.

Under the abuse of right principle found in Article 19 of the Civil Code, a person
must, in the exercise of his legal right or duty, act in good faith. He would be liable if he
instead acts in bad faith, with intent to prejudice another. Complementing this principle
are Articles 20 and 21 of the Civil Code which grant the latter indemnity for the injury he
suffers because of such abuse of right or duty.

When petitioner ignored the injunction, he shows bad faith and intent to spite
respondent who remained in the eyes of the law the Deputy Commissioner. His
exclusion of her from the centennial anniversary memorabilia was not an honest
mistake by any reckoning. Indeed, he withheld her salary and prevented her from
assuming the duties of the position. As the Court said in Amonoy v. Spouses
Gutierrez, a party’s refusal to abide by a court order enjoining him from doing an act,
otherwise lawful, constitutes an abuse and an unlawful exercise of right.
 Hence, petitioner was ordered to pay moral damages amounting to 200,000.00
and exemplary damages amounting to 50,000.00.
Doctrine: Human Relations

“A breach of promise to marry per se is not an actionable wrong.”

“Where a man's promise to marry is in fact the proximate cause of the

acceptance of his love by a woman and his representation to fulfill that promise
thereafter becomes the proximate cause of the giving of herself unto him in a sexual
congress, proof that he had, in reality, no intention of marrying her and that the promise
was only a subtle scheme or deceptive device to entice or inveigle her to accept him
and to obtain her consent to the sexual act, could justify the award of damages pursuant
to Article 21 not because of such promise to marry but because of the fraud and deceit
behind it and the willful injury to her honor and reputation which followed thereafter. It is
essential, however, that such injury should have been committed in a manner contrary
to morals, good customs or public policy.”

Gashem Shookat Baksh vs. CA & Marilou T. Gonzales

G.R. No. 97336, February 19, 1993
J. Davide, Jr.

Facts:

Private respondent is twenty-two (22) years old, single, Filipino and pretty lass of
good moral character and reputation duly respected in her community while petitioner,
on the other hand, is an Iranian citizen residing at in Dagupan City and a student taking
a medical course.

Petitioner courted and proposed to marry private respondent. She accepted his
love on the condition that they would get married. Petitioner then visited the private
respondent's parents in Bañaga, Bugallon, Pangasinan to secure their approval to the
marriage. The petitioner forced her to live with him. She was a virgin before she began
living with him. A week before the filing of the complaint, petitioner's attitude towards her
started to change. He maltreated and threatened to kill her and as a result of such
maltreatment, she sustained injuries. During a confrontation with a representative of the
Office of the Barangay Captain a day before the filing of the complaint, petitioner
repudiated their marriage agreement and asked her not to live with him anymore. The
petitioner is already married to someone living in Bacolod City.

Private respondent filed with the trial court a complaint for damages against the
petitioner for the alleged violation of their agreement to get married. The trial court as
affirmed by the CA found petitioner liable for damages under Article 21 of the Civil
Code.

Issue:

Whether or not petitioner is liable for damages for a breach of promise to marry
on the basis of Article 21 of the Civil Code of the Philippines.

Held:

Yes, petitioner is liable for damages for a breach of promise to marry on the
basis of Article 23 of the Civil Code of the Philippines, which provided that any person
who wilfully causes loss or injury to another in manner that is contrary to morals, good
customs or public policy shall compensate the latter for the damage..

The existing rule is that a breach of promise to marry per se is not an actionable
wrong.  
 This notwithstanding, the said Code contains a provision, Article 21, which is
designed to expand the concept of torts or quasi-delict in this jurisdiction by granting
adequate legal remedy for the untold number of moral wrongs which is impossible for
human foresight to specifically enumerate and punish in the statute books. 

In the light of the above laudable purpose of Article 21, the Court is of the
opinion, and so hold, that where a man's promise to marry is in fact the proximate cause
of the acceptance of his love by a woman and his representation to fulfill that promise
thereafter becomes the proximate cause of the giving of herself unto him in a sexual
congress, proof that he had, in reality, no intention of marrying her and that the promise
was only a subtle scheme or deceptive device to entice or inveigle her to accept him
and to obtain her consent to the sexual act, could justify the award of damages pursuant
to Article 21 not because of such promise to marry but because of the fraud and deceit
behind it and the willful injury to her honor and reputation which followed thereafter. It is
essential, however, that such injury should have been committed in a manner contrary
to morals, good customs or public policy.

In the instant case, respondent Court found that it was the petitioner's "fraudulent
and deceptive protestations of love for and promise to marry plaintiff that made her
surrender her virtue and womanhood to him and to live with him on the honest and
sincere belief that he would keep said promise, and it was likewise these fraud and
deception on appellant's part that made plaintiff's parents agree to their daughter's
living-in with him preparatory to their supposed marriage."  In short, the private
respondent surrendered her virginity, the cherished possession of every single Filipina,
not because of lust but because of moral seduction — the kind illustrated by the Code
Commission.
Doctrine: Human Relations

What is being sought to be prevented is not competition per se but the use of
unjust, oppressive or high- handed methods which may deprive others of a fair chance
to engage in business or to earn a living. Plainly, what the law prohibits is unfair
competition and not competition where the means use dare fair and legitimate.

Willaware Products Corporation vs. Jesichris Manufacturing Corporation

G.R. No. 195549, September 3, 2014
J. Peralta

Facts:
Jesichris Manufacturing filed for damages for unfair competition with prayer for
permanent injunction to enjoin willaware products corp., from manufacturing and
distributing plastic-made automotive parts like those of respondent. Jesichris allege that
it is a duly registered partnership in the distribution and manufacturing of plastic and
metal products. Willaware denies all the allegations except the facts that it is engaged in
the manufacture and distribution of kitchenware items made of plastic and metal and
that there is physical proximity of its office to that of right to use. It also claimed that
there could be no unfair competition and that jesichris has no exclusive right to use,
manufacture and sell those products as it had no patent over the same.

Issue:
Whether or not petitioner committed acts amounting to unfair competition under
Article 28 of the Civil Code.

Ruling:
Article 28 of the civil code provides that “unfair competition in agricultural,
commercial or industrial enterprises or in labor using force, intimidation, deceit,
machination or any other unjust, oppressive or high-handed method shall give rise to a
right of action by the person who thereby suffers damage. To qualify as unfair (1) it must
involve an injury to a competitor or trade rival, and (2) it must involve acts which are
characterized as unlawful; in the language of our law, these include force, intimidation,
deceit, machination or any other unjust, oppressive, or high-handed method.
In the present case, both characteristics are present. First, both parties are
competitors or trade rivals, both being engaged in the manufacture of plastic-made
automotive parts. Second, the acts of the petitioner were clearly “contrary to good
conscience” as petitioner admitted having employed respondent’s former employees,
deliberately copied respondent’s products even went to the extent of selling these
products to respondent’s customers. In sum, petitioner I guilty of unfair competition
under article 28 of the civil code.
Doctrine: Human Relations

“In violating the contract of lease by failing to pay the rent, the lessee took the
risk of losing the improvements it introduced on the property.”

Spouses Manzanilla vs. Waterfields Industries Corporation,

G.R. No. 170484, July 18, 2014
J. Del Castillo

Facts:
The spouses Manzanilla are the owners of a parcel of land. They leased a portion
to the Waterfields. They executed and amendment to the contract of lease. Starting
April 1997, waterfields failed to pay the monthly rental. The spouse’s manzanilla filed
before the MTC a complaint for ejectment against waterfields. They alleged that they
entered a contact of lease with waterfields on and that the same was amended. The
case was elevated to the RTC, however the CA reversed the decision that the contract
of lease which says; be used exclusively for the payment of unpaid utilities, if any, and
other incidental expenses only applied at the termination of the lease.

Issue:
Whether or not the CA is correct in saying that spouses have no cause of action in
dismissing the action for unlawful detainer.

Ruling:
No. In an unlawful detainer suit, two requisites must concur: (1) there must be failure
to pay rent or comply with the conditions of the lease, and (2) there must be a demand
both to pay or to comply and vacate. The first requisite refers to the existence of the
cause of action for unlawful detainer, while the second refers to the jurisdictional
requirement of demand in order that said cause of action may be pursued. Implied in
the first requisite, which is needed to establish the cause of action of the plaintiff and the
defendant, the same being needed to establish the lease conditions alleged to have
been violated. Failure to pay the rent must precede termination of the contract due to
non-payment of rent. It therefore follows that the cause of action for unlawful detainer in
this case must necessarily arise before the termination of the contract and not the other
way around as what the CA supposed. Indeed, in going beyond the termination of the
contract, the CA went in a bit too far in its resolution of this case.