BANK OF THE PHILIPPINES ISLAND and GRACE ROMERO, petitioners, vs. COURT OF APPEALS and EDVIN F. REYES, respondents.

G.R. No. 116792 March 29, 1996 #15

FACTS: Respondent Edvin Reyes maintains two accounts with BPI. The first account is one with his wife as codepositor and the second was one with her grandmother as co-depositor. As for monthly pension of her grandmother, Edvin regularly deposits on the second account, US Treasury Warrants payable to the order of his grandmother.. However, when her grandmother died, without the knowledge of BPI and US Treasury Department, the latter still sent him treasury check of which he deposited and credited by the BPI in the second account. Thereafter, Edvin immediately close his second account and transfer all the funds to the first account. However, several months later, the US treasury warrant sent by BPI for clearing was dishonored, discovering that the check was issued 3 days after the grandmother died. Hence BPI manager Romero, when she called up and apprised Mr. Edvin of the matter, verbally instructed her to debit the first account for the erroneous credit made. However, surprisingly, later on, he denied the authorization given and demand from BPI to restitute the amount taken by filing a suuit against it in RTC. To this Lower court did not agree. But CA reversed. Hence, this petition by BPI.

ISSUE: Whether legal compensation is proper giving the bank the right to debit the first account because of failure of the check to realized. RULING: Supreme Court reversed the decision of CA and sustained that of RTC. All the requisites of legal compensation under article 1279 are present. It 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 or even without the consent of them. In the case at bar, the obligors are at the same time debtor and creditor of each other. BPI as the debtor and Edvin as the creditor with regard to the savings account, but with respect to the dishonored check which was in advance credited by the bank in favor of Edvi, BPI stands as a creditor and Edvin as a debtor, because the treasury warrant is illegally transferred to his account. Both debts involved consist of a sum of money which is due, liquidated and demandable and not claimed by third person.

GUZMAN, BOCALING & CO., petitioner, vs. RAOUL S. V. BONNEVIE, respondent. G.R. No. 86150 March 2, 1992 # 40
FACTS: A 600 sqm parcel of land with two buildings belonging to the Intestate Estate of Jose Reynoso was leased toRaoul and Christopher Bonnevie by the administratixAfrica Valdez for a period of one year at a rate of 4K a month. In the contract of lease, there is a stipulation that in case the lessor desires or decides to sell the leased property, the lessees shall be given a first priority to purchase the same I n N o v . 1 9 7 6 , a d m i n i s t r a t i x n o t i f i e d t h e r e s p b y registered mail that she is selling the premises for600K less a mortgage loan and giving them 30 daysfrom receipt to exercise their right of first priority. If they would not exercise, she expects them to vacatethe prop in March 1977. In Jan 1977, she sent a letter notifying them that intheir failure to exercise their right, and she has already s o l d t h e p r o p e r t y . T h i s i s t h e o n l y l e t t e r t h a t t h e Bonnevies received. They informed agent that theyare willing to make negotiations and that they refuse the termination of the lease. Until the property was formally sold to Guzman,B o c a l i n g & Corp for 400K and the balance of thisa m o u n t s h a l l b e p a i d w h e n t h e B o n n e v i e s h a v e already vacated the premises. A d m i n i s t r a t i x d e m a n d e d t h a t t h e y v a c a t e t h e premises and pay the rentals for four months. T h e y h a d a C o m p r o m i s e A g r e e m e n t t h a t t h e Bonnevies shall vacate the premises not later thanOct. 1979 but this was set aside. The Bonnevies filed an action for annulment of thesale between REynoso and the GBC and ancellation of the transfer certificate. They also asked that Reynosobe required to sell the property to them under the same terms and conditions agreed upon the Contractof sale. ISSUE: Whether the Bonnevies can file for an action for annulment of the sale between Reynoso and the GBC considering that they aret hird parties to the contract. RULING: Yes. The Contract of Sale was not voidable but rescissible. Under Art 1380 to 1381 ( 3 ) o f t h e C C , a c o n t r a c t otherwise valid may nonetheless be subsequently rescinded by reason of injury to third persons, l ike c r e d i t o r s . T h e s t a t u s o f c r e d i t o r s c o u l d b e v a l i d l y accorded the Bonnevies for they had substantial i n t e r e s t t h a t w e r e p r e j u d i c e d b y t h e s a l e o f t h e subject property to the petitioner without recognizing their right of first priority under the Contract of Lease. Rescission is a remedy granted by law to the c o n t r a c t i n g p a r t i e s a n d e v e n t o t h i r d p e r s o n s , t o secure reparation for damages caused to them by acontract, even if this should be valid, by means of the r e s o t o r a t i o n o f t h i n g s t o t h e i r c o n d i t i o n a t t h e moment prior to the celebration of said contract. It is a relief allowed for the protection of one of thecontracting parties and even third persons from all i n j u r y a n d d a m a g e t h e c o n t r a c t m a y c a u s e , o r t o protect some incompatible and preferred right created by the contract. Rescission implies a contract which, even if initially v a l i d , p r o d u c e s a l e s i o n o r p e c u n i a r y d a m a g e t o someone that justifies its invalidation for reasons of equity. G B C c a n n o t b e b u y e r s i n g o o d f a i t h b e c a u s e t h e y h a d knowledge of the lease of the premise. They were n e g l i g e n t i n n o t i n q u i r i n g a b o u t t h e t e r m s o f t h e l e a s e o f t h e contract.

PHILIPPINE NATIONAL BANK, petitioner, vs. COURT OF APPEALS and LORETO TAN, respondents. G.R. No. 108630 April 2, 1996 #65 FACTS: By virtue of the expropriation proceedings against the land of respondent Loreto Tan, the government was adjudge to pay Loreo tan for just compensation in the amount of P32,480.00. It was petitioner PNB who was required to release the said the said amount. The assistant branch manager issued managers check and delivered the same to one named Sonia Gonzaga without Tans knowledge consent and authority but purportedly on the strenght of Special Power of attorney she alleged had been given. Tan maintain that he never received the amount, so this prompt him to file an action to recover the amount from PNB in RTC. The SPA which the PNB relied from was never produced, hence it ordered PNB to give back the said amount. This decision was affirmed by CA. Hence this petition. ISSUE: Whether there was an effective payment made by the PNB. RULING: Supreme Court ruled in favor of Respondent Tan. Under Rule 1233 of the Civil Code, A debt shall not be understood to have been paid unless the thing or service, in which the obligation consist has been completely delivered or rendered. The burden of proof of such payment lies with the debtor.\In the instant case, neither the SPA nor the check issued by PNB was ever presented in court. The testimonies of PNBs own witness were also conflicting, thus it is clear that no payment ever been made to Tan as the check was never delivered on him

JARCO MARKETING CORPORATION, LEONARDO KONG, JOSE TIOPE and ELISA PANELO, petitioners, vs. HONORABLE COURT OF APPEALS, CONRADO C. AGUILAR and CRISELDA R. AGUILAR, respondents. G.R. No. 129792 December 21, 1999 #90
FACTS: Jarco Marketing owns Syvel's Department Store. Kong, Tiope, and Panelo are store managers; Sps. Aguilar are the parents of daughter Zhieneth. Criselda the mother and Zhieneth Aguilar (6 years old) were at the 2nd floor of Syvel's Department Store. Criselda was signing her credit card slip when she felt a sudden gust of wind and heard a loud bang. When she looked behind her, she saw her daughter pinned by the bulk of the store's gift wrapping counter. She asked the assistance of the people around her, and she was immediately rushed to Makati Medical Center where she was operated. The next day, she lost her speech. She died 14 days after the accident. The cause of her death was attributed to the injuries sustained. After her burial, Sps. Aguilar demanded the reimbursement of hospitalization, medical bills, and wake and funeral expenses from the petitioners, but they refused to pay. Sps. Aguilar filed a complaint for damages The petitioners denied any liability for Zhieneth's injuries and death. They also said the complaint was malicious, so they sought the dismissal of the complaint and an award of moral and exemplary damages, as well as attorney's fees. Criselda was negligent in exercising care and diligence over her daughter by allowing her to freely roam around in a store with glassware and appliances

Zhieneth was guilty of contributory negligence for climbing the counter, thereby triggering its collapse

Counter was made of sturdy wood with strong support, and it has never fell nor collapsed for the past 15 years since its construction Jarco Marketing maintained that it observed due diligence of a good father of the family Other petitioners raised due care and diligence in the performance of its duties

RTC found that the preponderance of evidence favored the store, et al, saying that the proximate cause was Zhieneth's act of clinging to the counter, and that Criselda's negligence contributed to the accident. The RTC found that the counter was not an attractive nuisance [something that would attract children to approach, get on or use it], since the counter was situated at the end or corner of the 2nd floor.

Here are the assertions of Sps. Aguilar: Zhieneth should be entitled to the conclusive presumption that a child below 9 is incapable of contributory negligence.

Even if she is capable of contributory negligence, it was physically impossible for her to have propped herself on the counter considering her small frame, and height and weight of the counter. The fact that a former employee of the store, Gonzales, accompanied Zhieneth to the hospital belied the theory that Zhieneth climbed the counter. This employee Gonzales said that when Zhieneth was asked by the doctor what she did, she said "Nothing, I did not come near the counter and the counter just fell on me." This should be accorded credit according to the spouses. Negligence could not be imputed to Criselda since it was reasonable for her to let go of Zhieneth at that moment that she was signing the credit card slip. The proximate cause was petitioner's negligence in failing to institute measures to have the counter permanently nailed. In response, here is what the petitioners have to say: Zhieneth's death was an ACCIDENT.

Nailing the counter to the ground was not necessary because it has been there for the longest time without any prior accident and it's just in a corner. The criminal case for homicide through simple negligence filed against them was dismissed, and they were acquitted. The CA reversed RTC, ruling in favor of Sps. Aguilar. Petitioners were negligent in maintaining a structurally dangerous counter [it's shaped like an inverted L; the top is wider than the base; weight of the upper portion not evenly distributed nor supported by the narrow base]. Two former employees brought this to the attention of the management but the latter ignored their concern. CA said the incident could have been avoided had petitioners repaired this defective counter. The contention that it has been there for a long time without a prior incident is immaterial.

Zhieneth was incapable of negligence or other tort. Criselda was absolved of any negligence. Testimony of Gonzales (former employee) given credit

Awarded actual damages, compensatory damages [denied award of funeral expenses for lack of proof to substantiate it] CA denied petitioners' MfR, so they are now seeking the reversal of said decision, saying that since the action is based on tort, any finding of negligence on the part of Sps. Aguilar would negate their claim for damages, where said negligence was the proximate cause of the injury sustained. They also assailed the testimony of Gonzales who was already separated from the store (tarnished by ill-feelings and all).

ISSUES: 1. WON Zhieneth's death was accidental or attributable to negligence. ATTRIBUTABLE TO NEGLIGENCE 2. WON negligence was attributable to petitioners [for maintaining a defective counter] or to Sps. Aguilar [for failing to exercise due and reasonable care while inside the store]. FAULT OF PETITIONERS RULING: Accident v. Negligence - they are intrinsically contradictory ACCIDENT pertains to an unforeseen event in which no fault or negligence attaches to defendant (or if it happens wholly or partly through human agency, it is an event which under the circumstances is unusual or unexpected by the person to whom it happens); there is exercise of ordinary care here

NEGLIGENCE is the omission to do something which a reasonable man, guided by those considerations which ordinarily regulate the conduct of human affairs, would do, or the doing of something which a prudent and reasonable man would not do Alternatively, it is the failure to observe, for the protection of another person's interest, that degree of care, precaution and vigilance which the circumstances justly demand, whereby such other person suffers injury SC found that Zhieneth performed no act that facilitated her death. Basis is her statement to the doctor as related by former employee Gonzales. It was made part of the res gestae since she made the statement immediately subsequent to the startling occurrence. It is axiomatic that matters relating to declarations of pain or suffering and statements made to a physician are generally considered declarations and admissions. Also, the court considered the fact that Zhieneth was of a tender age (and in so much pain!), so it would be unthinkable that she would lie. Other findings: Petitioners were informed of the danger posed by the unstable counter, yet they did not act on the matter, so they failed to discharge the due diligence required of a good father of a family.

They failed to establish that the testimonies of former employees were biased. Conclusive presumption that children below 9 are incapable of contributory negligence is applied.

Even if contributory negligence would be attributed to Zhieneth, no injury should have occurred if petitioners' theory that the counter is stable and sturdy is to be believed. Criselda is absolved from any contributory negligence, since it was reasonable for her to let go of her child to sign a slip.