Documente Academic
Documente Profesional
Documente Cultură
G.R.
No.
165420.
June
30,
2005
FACTS:
Jaucian bought from the Nale a motorcycle with complete
accessories and a sidecar; out of the total purchase price the
Jaucian gave a downpayment of 1,700.00 with a promise that he
would pay Nale the balance within sixty days. The Jaucian,
however, failed to comply with his promise and so upon his own
request, the period of paying the balance was extended to one
year in monthly installments until January 1976 when he stopped
paying anymore
a chattel mortgage was constituted as a security for the
payment of the balance of the purchase price
it has been the practice of financing firms that whenever there is
a balance of thepurchase price the registration papers of the motor
vehicle subject of the sale are notgiven to the buyer
the motorcycle sold to the defendant was first mortgaged to the
Teja Marketing by Jaucian because the latter had no franchise of his
own (CPC) so he attached the unit to Nales MCH Line
the agreement of the parties was for Nale to undertake the
yearly registration of the motorcycle with the Land Transportation
Commission; pursuant to this agreement Jaucian gave Nale P90.00,
the P8.00 would be for the mortgage fee and the P82.00 for the
registration fee of the motorcycle; Nale failed to register the
motorcycle on the ground that the Jaucian failed to comply with
some requirements such as the payment of the insurance
premiums and the bringing of the motorcycle to the LTC for
stenciling, Nale saying that the defendant was hiding the
motorcycle from him; Nale explained that though the ownership of
the motorcycle was already transferred to Jaucian, the vehicle was
still mortgaged with the consent of the Jaucian to the Rural Bank of
Camaligan for the reason that all motorcycle purchased from Nale
on credit was rediscounted with the bank
because of the failure of Nale to register the motorcycle Jaucian
suffered damages when he failed to claim any insurance indemnity
for the more than two times that the motorcycle figured in
accidents
Nale filed an action for collection of sum of money with damages
against Nale
ISSUE: WON not respondent court erred in applying the doctrine of
pari delicto
HELD: No.
Kabit system is contrary to public policy and, therefore, void and
in existent under Article1409 of the Civil Code; the court will not
aid either party to enforce an illegal contract, but will leave both
where it finds then
Art. 1412: If the act in which the unlawful or forbidden cause
consists does not constitute a criminal offense, the following rules
The Court cited Spouses Castro vs. Tan, et al. (G.R. No. 168940; 24
November 2009), where it held that: The imposition of an
unconscionable rate of interest on a money debt, even if knowingly
and voluntarily assumed, is immoral and unjust. It is tantamount to
a repugnant spoliation and an iniquitous deprivation of property,
repulsive to the common sense of man. It has no support in law, in
principles of justice, or in the human conscience nor is there any
reason whatsoever which may justify such imposition as righteous
and as one that may be sustained within the sphere of public or
private morals.
(2) Settled is the rule that for a waiver to be valid and effective, it
must, in the first place, be couched in clear and unequivocal terms
which will leave no doubt as to the intention of a party to give up a
right or benefit which legally pertains to him. The intention to
waive a right or an advantage must be shown clearly and
convincingly. ACFLC failed to convince the Court that respondents
waived their right of redemption voluntarily.
The Court agreed with the CAs explanation in invalidating the
waiver: The supposed waiver was in fine print and in the form and
language prepared by ACFLC, partaking of the nature of a contract
of adhesion.
principle especially holds true with regard to waivers, which are not
presumed, but which must be clearly and convincingly shown.
ACFLC failed to show the efficacy of this waiver.
Moreover, to say that the mortgagors right of redemption may be
waived through a fine print in a mortgage contract is, in the last
analysis, tantamount to placing at the mortgagees absolute
disposal the property foreclosed. It would render practically
nugatory this right that is provided by law for the mortgagor for
reasons of public policy. A contract of adhesion may be struck
down as void and unenforceable for being subversive to public
policy, when the weaker party is completely deprived of the
opportunity to bargain on equal footing.
(3) The case for annulment of mortgage was filed long before the
consolidation of ACFLCs title over the property. In fact, when
respondents filed said case at the first instance, the title to the
property was still in Cesarios name. It was pending with the RTC
when ACFLC filed a petition for foreclosure of mortgage and even
when a writ of possession was issued. Clearly, ACFLCs title was
subject to the final outcome
of the case for annulment of mortgage.
Ponente: J. Antonio Eduardo B. Nachura