1987 BAR QUESTIONS

OBLIGATIONS AND CONTRACT; Estoppel

1987 No. 7:

Fred sold to Juan a parcel of land, belonging to his minor son, Lino, then
under his guardianship, without judicial approval. After the sale, Juan immediately
took possession of the land, built a house and religiously paid the taxes thereon.
Nine years thereafter, Lino, no longer a minor, rented the ground floor of the house
built by Juan. Lino paid the rent for the first month, then stopped paying. Two years
thereafter, when pressed for payment of the accrued rent. Lino refused, claiming ownership over
the property, alleging that the sale of the property to Juan while he
was A minor without the approval of the guardianship court rendered the sale null
and void.

Is the claim of Lino valid and meritorious.? Explain.

Answer:
No, Lino's claim is not valid and not meritorious because Lino is in estoppel.
A lessee cannot assail the right and title of the lessor and cannot claim ownership as
against the lessor. The fact that the sale was made while Lino was a minor is of no
moment because he recognized and ratified the contract after he was already of
majority age.

Alternative Answer:
No, Lino's claim is not valid and not meritorious because Juan had already become the owner of
the land by ordinary acquisitive prescription through adverse possession of the land for over ten
(10) years.

Alternative Answer:
No, Lino's claim is not valid and not meritorious. Lino can no longer recover the land because of
laches ownership over the property, alleging that the sale of the property to Juan while he was
A minor without the approval of the guardianship court rendered the sale null and void.

SALES AND LEASE; Double Sales

1987 No. 8:

Miguel, Carlos and Lino are neighbors. Miguel owned a piece of registered land which both Carlos
and Lino wanted to buy. Miguel sold the land to Carlos. The sale was not registered upon the
request of Miguel. Later on, the same property was sold by Miguel to Lino. Miguel told Carlos
about the second sale. Carlos immediately tried to see Lino to discuss the matter and inform him
of the previous sale to him (Carlos) of the same property but Lino refused to see Carlos.
Thereupon Carlos annotated in the Registry of Property his adverse claim on the property. A week
later, Lino registered the sale on his favor and had a new transfer certificate of title issued in his
name. However, the adverse claim of Carlos was duly annotated in the
title. Notwithstanding, Lino took possession of the property and built a small bungalow thereon.
(a) Who is the rightful owner of the property? Explain.
(b) To whom would the bungalow built by Lino on the property belong? Explain.

Answer:
(a) In double sales, under Article 1544 the land sold belongs to the first
registrant in good faith. If none, it belongs to the first possessor in good faith. If none it
belongs to the person with the oldest title, provided there is good faith. Carlos, who
has the oldest title, is therefore the rightful owner of the' property, because there was
no registration in good faith by Lino.
(b) The bungalow built by Lino belongs to Carlos. Lino is a builder in bad faith.
Article 449 provides that he who builds in bad faith on the land of another loses what
it built without right to indemnity

SALES AND LEASE; Contract for a piece of work

Lino entered into a written agreement for the repair of his private plane with
Airo Repair Works, Inc. for P500,000. Additional work was done upon the verbal
request and authority of a duly recognized representative of Linn. Lino refused to
pay for the additional work, interposing as a defense the absence of a written
contract for the additional work done.
Is the defense put up by Lino valid? Explain?

Answer:
The defense put up by Lino is valid under Article 1724 of the Civil Code. The
change must have been authorized by the proprietor in writing, and the additional
price to be paid the contractor must have been determined in writing by both parties.

Alternative Answer:
It appearing that the additional work was done upon verbal request and authority of a duly
authorized representative of Lino, and the benefits have been received by Lino in consequence
of the actual repair and the additional work, the defense put up by Lino is not valid on the
ground that no person may unjustly enrich himself at the expense of another.

PARTNERSHIP; Partner by estoppel

1987 No. 5:

Tomas, Rene and Jose entered into a partnership under the firm name
"Manila Lumber." Subsequently, upon mutual agreement, Tomas withdrew from the
partnership and the partnership was dissolved. However, the remaining partners,
Rene and Jose, did not terminate the business of "Manila Lumber." Instead of
winding up the business of the partnership and liquidating its assets, Rene and Jose
continued the business in the name of "Manila Lumber" apparently without objection
from Tomas. The withdrawal of Tomas from the partnership was not published in the
newspapers.

Could Tomas be held liable for any obligation or indebtedness Rene and
Jose might incur while doing business in the name of "Manila Lumber" after his
withdrawal from the partnership? Explain.

Answer:
Yes. Tomas can be held liable under the doctrine of estoppel. But as regards
the parties among themselves, only Rene and Jose are liable. Tomas cannot be
held liable since there was no proper notification or publication.
In the event that Tomas is made to pay the liability to third person, he has the
right to seek reimbursement from Rene and Jose (Articles 1837 to 1840; Goquiolay
vs. Sycip, 9 SCRA 663).

CREDIT TRANSACTIONS; Deposit

1987 No. 11:

Ana rented a safety deposit box at the Alto Bank, paid the rental fee and was
given the key. Ana put her jewelry and gold coins in the box. Days after, three armed
men gained entry into the Alto Bank, opening its vault and several safety deposit
boxes, including Ana's and emptied them of their contents.
Could Ana hold the Alto Bank liable for the toss of the contents of her deposit
box? Explain.
Answer:
No, because under Article 1990 of the Civil Code, if the depository by force
majeure loses the thing and receives money or another thing in its place, he shall
deliver the sum or other thing to be depositor. There being no showing that there
was anything received in place of the things deposited, the Alto Bank is not liable for
the contents of the safety box.

Answer:
The Alto Bank is not liable because the contract is not a deposit but a rental
of the safety deposit box. Hence, the Alto Bank is not liable for the loss of the
contents of the box.

TORTS AND DAMAGES

1987 No. 2:

Ato was the registered owner of a passenger jeepney, which was involved in
a collision accident with a vegetable truck, resulting in the death of four passengers
and injuries to three. At the time of the accident, Ato was legally married to Maria but
was cohabiting with Tonia in a relationship akin to that of husband and wife.
Could the heirs of the dead passengers and the injured persons recover
damages from:

(a) Ato?
(b) Maria?
(c) Tonia?
Explain each case.
Answer:
a. Ato - Yes. Insofar as the dead passengers are concerned, the heirs can
recover damages on the basis of culpa contractual. If the injured persons are also
passengers, Ato is likewise liable on the same basis of culpa contractual. However,
if the injured persons are not passengers, then the liability for damages of Ato will
be on the basis of a quasi-delict.

b. Maria - In view of the ruling in Juaniza v. Jose (89 SCRA 306) that the
passenger jeepney acquired by the husband during an illicit cohabitation with
the paramour is conjugal property, Maria is liable to the same extent as Ato insofar
as the conjugal property in the marriage between Ato and Maria could be
answerable. But as regards her paraphernal property, Maria cannot be held
answerable.

c. Tonia - No, In Juaniza v. Jose the paramour of the owner of the passenger
jeepney that figured in an accident was held to be not a co-owner, and therefore not
liable for damages. Article 144 is inapplicable.

TORTS AND DAMAGES

1987 No. 15:

The X Electric Cooperative services a small town where the roads are lined
with lush acacia trees- Normally these trees are pruned before the onset of the rainy
season by the cooperative itself since the power lines of the cooperative are not
infrequently affected by falling branches. This year, for financial reasons, the electric
cooperative omitted the pruning in spite of reminders from the townspeople. In
August this year a strong typhoon hit the town and live wires fell to the ground. While
the cooperative made a preliminary survey of the damages, it did not immediately
take precautionary measures against possible harm. Thus, the attention of one of its
employees was called to the fallen wire in the center of the town. Before the
cooperative could make the necessary repairs, a four-year old boy crossed the
street and was electrocuted by the live wire.

His parents sued the electric cooperative for damages,

(a) If you were counsel for the parents, what arguments would you advance to support
your claim for damages and how much damages would you demand?
(b) If you were counsel for the electric cooperative, what defenses would you offer?
(c) If you were judge, how would you decide the case?

Answer:
a. The damages that can be claimed by the parents are the following:
1. civil indemnity for death - P30,000.00, (The People of the Philippines v. Leopoldo Traya,
L-48065, Jan. 29, 1987);
2. actual and compensatory damages;
3. moral damages for mental anguish;
 4. exemplary or corrective damages.
b. As counsel for the electric cooperative, 1 would offer the defense of "fortuitous event,"
because the strong typhoon could not be foreseen and even if foreseen, could not be avoided.
c. As judge, I would rule for the parents. The attention of the cooperative through its employee
was called to the fallen live wire. If there had been care and diligence, the death could have
been avoided. The cooperative could have made the necessary repairs before the 4 year old
boy crossed the street and was electrocuted by the live wire. It failed to do so, hence it is
liable.

TORTS AND DAMAGES; insurance; subrogation

1987 No. 6.

M/S Philippines, operated by United Shipping Lines, loaded in Japan for

shipment to Manila 50 crates of pipes consigned to Standard Blooming Mills. The
shipment was insured against marine risks with Marine Insurance Company.
Enroute, the ship caught fire resulting in the total-loss of ship and cargo. The
insurance company paid the consignee and thereafter sought recovery and
reimbursement from the United Shipping Lines as subrogee unto the rights of the
insured. Evidence was presented establishing the fact that from the time the goods
were stored in the ship's hatch, no regular inspection was made during the voyage
such that the fire must have started 24 hours before it was noticed.
Could the insurance company claim reimbursement of the amount it had paid
its insured from the United Shipping Lines? Explain.

Answer:
Yes. Under Article 2207, the insurer is subrogated to the rights of the insured
against the wrongdoer or the person who violated the contract when the insurer
pays or indemnifies the insured for the injury or loss arising out of the wrong or
breach of contract complained of. There being a breach of contract of carriage in
view of total loss of the cargo insured, Marine Insurance Company may claim
reimbursement of the amount paid the insured from the United Shipping Lines.