Balita, Lyca Agnes 

150263 
 
IGNACIO ARROYO, plaintiff and appellant, 
vs. 
ALFRED BERWIN, defendant and appellee. 
G.R. No. 10551 ​March 3, 1917 ​ Carson  
Contracts: ​Contrary to Public Policy 
 
FACTS: 
1. Berwin is a procurator judicial in the law office of Atty Bordman, and is authorized by the courts to 
practice in justice of the peace courts of Iloilo. He represented Juaneza in the justice of the peace court 
of Iloilo in proceedings for theft prosecuted by Arroyo.  
2. The court decided against Juaneza. She appealed to the CFI Iloilo.  
a. On the day of hearing of the appeal, Berwin requested Arroyo to agree to dismiss the 
proceedings and stipulated in the presence of Samson that his client Juaneza would recognize 
Arroyo’s ownership in the land, where Juaneza ordered the cane cut (which is the cause for 
theft in the case).  
b. Berwin agreed the Arroyo should obtain a Torrens title to the land and Juaneza 
would not oppose the application for registration, provided Arroyo would ask the 
prosecuting atty to dismiss the proceedings.  
3. Arroyo complied with his agreement, and the case was dismissed.  
4. However, Berwin did not comply with the agreement. Arroyo delivered a written agreement attesting 
that Juaneza recognized Arroyo’s ownership of the land, but the agreement has not been returned 
despite elevated demands.  
a. Thus, Arroyo prays that Berwin be ordered to comply with the agreement by causing Juaneza 
to sign the document.  
5. RTC: DISMISSED on the ground of illegality of consideration of the contract.  
6. Hence, this petition.  
 
ISSUE: 
1. W/n the contract is invalid for being contrary to public policy  
 
DECISION: 
AFFIRMED 
 
HELD: 
YES. A​ n agreement by the owner of stolen goods to stifle prosecution of the person charged with 
theft for a consideration, is manifestly contrary to public policy and the due administration of justice.  
In the interest of the public, it is of utmost importance that criminals be prosecuted and criminal proceedings 
be instituted and maintained in the form and manner prescribed by law. ​To permit an offender to escape 
penalties prescribed by law by the purchase of immunity from private individuals would result in 
perversion of justice.  
The Civil Code provides that: Contracts without consideration or with an illicit one have no effect 
whatsoever. A consideration is illicit when it is contrary to law and good morals.