1)G.R. No. 129227.

May 30, 2000

BANCO FILIPINO SAVINGS AND MORTGAGE BANK, petitioner

vs.

THE HON. COURT OF APPEALS, and CALVIN & ELSA ARCILLA, respondents

Ponente: GONZAGA_REYES, J:

The Case

This is a Petition for Review on Certiorari of the Decision of the Court of Appeals in CA-G.R. CV No. 45891
entitled CALVIN S. ARCILLA and ELSA B. ARCILLA vs. BANCO FILIPINO SAVINGS and MORTGAGE BANK, ET.
AL. which affirmed the decision of the Regional Trial Court (RTC), Branch 33, Manila ordering BANCO
FILIPINO to pay CALVIN and ELSA ARCILLA the amount of P126,139.00 with interest thereon at 12% per
annum from the filing of the complaint.

Facts

Elsa and Calvin Arcilla secured on 3 occassions, loan from petitioner, Banco Filipino Savings and Mortgage
Bank, as evidenced by promissory note. To secure the payment of said loans, the Appellees executed "Real
Estate Mortgages" in favor of the Appellants over their parcels of land located in BF-Paranaque. Under
said deeds, the Appellant may increase the rate of interest, on said loans, within the limits allowed by law.
At that time, under the Usury Law, Act 2655, as amended, the maximum rate of interest for loans secured
by real estate mortgages was 12% per annum. Later, the Central bank issued Circular No. 494 providing
for the maximum interest of 19% per annum. In the meantime, the Skyline Builders, Inc., through its
President, Appellee Calvin Arcilla, secured loans from the Bank of the Philippine Islands. To insure
payment of the aforesaid loan, the FGU Insurance Corporation, issued PG Bond No. 1003 for the amount
in favor of the Bank of the Philippine Islands. Skyline Buildings, Inc., and the Appellees executed an
"Agreement of Counter-Guaranty with Mortgage" in favor of the FGU Insurance Corporation covering the
aforesaid parcels of land to assure payment of any amount that the insurance company may pay on
account of said loans. Banco Filipino prepared and issued a "Statement of Account" to the Appellees on
their loan account to the effect that, as of October 30, 1978, the balance of their loan account, inclusive
of interests, computed at 17% per annum. It turned out that the Appellant unilaterally increased the rate
of interest on the loan account of the Appellees from 12% per annum to 17% per annum on the authority
of the said Central Bank Circular.

The Appellees failed to pay their monthly amortizations to Appellant. The latter filed, on April 3, 1979, a
petition, with the Provincial Sheriff, for the extrajudicial foreclosure of Appellees "Real Estate Mortgage"
in favor of the Appellant inclusive of the 17% per annum which purportedly was the totality of Appellees
account with the Appellant on their loans. The Appellant was the purchaser of the property at public
auction. On May 25, 1979, the Sheriff executed a "Certificate of Sale" over the aforesaid properties in
favor of the Appellant. Appellees filed a complaint for the "Annulment of the Loan Contracts, Foreclose
Sale with Prohibition and Injunction, Etc." The complaint states, that the loan contracts and mortgages
between the Appellees and the Appellant were null and void because: (a) the interests, charges, etc., were
deducted in advance from the face value of the "Promissory Notes" executed by the Appellees; and (b)
the rate of interests charged by the Appellant were usurious.
In its Answer to the Complaint, the Appellant averred that the interests charged by it on Appellees loan
accounts and that the said loan contracts and mortgages were lawful. The Appellant further averred that
the Appellees action had already prescribed. On December 3, 1987, the Appellees filed a Motion, with the
Court a quo, for leave to file an "Amended Complaint" to implead FGU Insurance Corporation as party
defendant. The Court granted said motion and admitted Appellees Amended Complaint.

The RTC rendered in favor of the plaintiffs and against defendant Banco Filipino ordering defendant Banco
Filipino to pay spouses Calvin S. Arcilla and Elsa B. Arcilla with interest thereon at 12% per annum reckoned
from the filing of the complaint. Petitioner appealed to the Court of Appeals, but it affirmed the decision
of the RTC.

Issues:
1. Has the action of the private respondents prescribed?
2. Are the respondents entitled to the refund of the alleged interest overpayments?

RULING:

1. No. Petitioners claim that the action of the private respondents has prescribed is bereft of merit.
Under Article 1150 of the Civil Code, the time for prescription of all kinds of actions, when there
is no special provision which ordains otherwise, shall be counted from the day they may be
brought. Thus, the period of prescription of any cause of action is reckoned only from the date
the cause of action accrued. And a cause of action arises when that which should have been done
is not done, or that which should not have been done is done. The period should not be made to
retroact to the date of the execution of the contract on January 15, 1975 as claimed by the
petitioner for at that time, there would be no way for the respondents to know of the violation of
their rights. The Court of Appeals therefore correctly found that respondents cause of action
accrued on October 30, 1978, the date they received the statement of account showing the
increased rate of interest, for it was only from that moment that they discovered the petitioners
unilateral increase. The reliance by the petitioner on Central Bank Circular 494 to unilaterally raise
the interest rates on the loan in question was without any legal basis.
2. Yes, the respondents are entitled to recover the alleged overpayments of interest, despite the
absence of any prayer therefor. This Court has ruled that it is the material allegations of fact in
the complaint, not the legal conclusion made therein or the prayer that determines the relief to
which the plaintiff is entitled. It is the allegations of the pleading which determine the nature of
the action and the Court shall grant relief warranted by the allegations and the proof even if no
such relief is prayed for. Thus, even if the complaint seeks the declaration of nullity of the contract,
the Court of Appeals correctly ruled that the factual allegations contained therein ultimately seek
the return of the excess interests paid.

WHEREFORE, the decision of the Court of Appeals is AFFIRMED and the instant petition is DENIED.
2)G.R. NO. 176014 : September 17, 2009

ALICE VITANGCOL and NORBERTO VITANGCOL, Petitioners

Vs.

NEW VISTA PROPERTIES, INC., MARIA ALIPIT, REGISTER OF DEEDS OF CALAMBA, LAGUNA, and the
HONORABLE COURT OF APPEALS Respondents

Ponente: VELASCO, JR., J

The Case

In this Petition for Review under Rule 45 of the Rules of Court, petitioners Alice Vitangcol and Norberto
Vitangcol (collectively, Vitangcol) assail the August 14, 2006 Decision and December 19, 2006 Resolution
of the Court of Appeals (CA) in CA-G.R. CV No. 84205 which reversed the December 21, 2004 Order of the
Regional Trial Court (RTC), Branch 35, in Calamba City, Laguna, in Civil Case No. 3195-2001-C for Quieting
of Title entitled New Vista Properties, Inc. v. Alice E. Vitangcol, Norberto A. Vitangcol, Maria L. Alipit and
Register of Deeds of Calamba, Laguna.

Facts

On June 18, 1989, Maria and Clemente A. Alipit, who are siblings, with the marital consent of the latter's
wife, executed a Special Power of Attorney (SPA) constituting Milagros A. De Guzman as their attorney-
in-fact to sell their property described in the SPA as "located at Bo. Latian, Calamba, Laguna covered by
TCT No. (25311) 2538 with Lot No. 1735 consisting of 242,540 square meters more or less. Having an SPA,
De Guzman executed on August 9, 1989 a Deed of Absolute Sale conveying to New Vista Properties, Inc.
(New Vista) a parcel of land with an area of 242,540 square meters situated in Calamba, Laguna, for the
value of P 60.00 per square meter with a total price consideration of FOURTEEN MILLION FIVE HUNDRED
FIFTY TWO THOUSAND FOUR HUNDRED PESOS (P14,552,400.00). Following the sale, New Vista
immediately entered the subject lot, fenced it with cement posts and barbed wires, and posted a security
guard to deter trespassers. After more than a decade later, New Vista learned that the parcel of land it
paid for and occupied was being claimed by petitioners Vitangcol on the strength of a Deed of Absolute
Sale for Lot No. 1702 under TCT No. (25311) 2528 entered into on August 14, 2001 by and between
Vitangcol and Maria Alipit. Consequent to the Vitangcol-Maria Alipit sale, TCT No. (25311) 2528 was
canceled and TCT No. T-482731 was issued instead in favor of Vitangcol on August 15, 2001. Alarmed by
the foregoing turn of events, New Vista filed a notice of adverse claim over TCT No. T-482731, followed
by commencing a suit for quieting of title before the RTC. New Vista alleged paying, after its purchase of
the subject lot in 1989, the requisite transfer and related taxes therefor, and thereafter the real estate
taxes due on the land. New Vista also averred that its efforts to have the Torrens title transferred to its
name proved unsuccessful owing to the on-going process of reclassification of the subject lot from
agricultural to commercial/industrial. New Vista prayed for the cancellation of Vitangcol's and that it be
declared the absolute owner of the subject lot.

On December 11, 2001, Vitangcol moved to dismiss the complaint which New Vista duly opposed. An
exchange of pleadings then ensued. On June 27, 2003 or before Maria Alipit and Vitangcol, as defendants,
could answer, New Vista filed an amended complaint which did not have, as attachment, the June 18,
1989 SPA. It, however, averred that Clemente and Maria Alipit had ratified and validated the sale of Lot
No. 1702 covered by TCT No. (25311) 2528 by their having delivered possession of said lot to New Vista
after receiving and retaining the purchase price. In an initial order, the RTC denied Vitangcol's and Maria
Alipit's separate motions to dismiss the amended complaint. It held that the amended complaint
sufficiently stated a cause of action. Vitangcol sought reconsideration, attaching to the motion a copy of
the June 18, 1989 SPA which, in the previous hearing, was accepted as evidence pursuant to Sec. 8, Rule
10 of the Rules of Court. By Order dated July 14, 2004, the RTC granted reconsideration and dismissed the
amended complaint, and set aside its Order dated November 25, 2003 and by virtue of this order finds
that the Amended Complaint states no cause of action and that the claim of the plaintiff in the present
action is unenforceable under the provisions of the statue of frauds, hence, the Amended Complaint is
DISMISSED, pursuant to Rule 16, Section 1, paragraph g and i. In reversing itself, the RTC made much of
the fact that New Vista did not attach the SPA to the amended complaint. The RTC also stated the
observation that New Vista's act of not directly mentioning the SPA and the non-attachment of a copy
thereof in the amended complaint constituted an attempt "to hide the fact that Milagros Alipit-de Guzman
is only authorized to sell a parcel of land denominated as Lot No. 1735 of the Calamba Estate, and not Lot
No. 1702 of the Calamba Estate, which is the subject matter of the Deed of Absolute Sale. According to
the RTC, what the agent (De Guzman) sold to New Vista was Lot No. 1702 which she was not authorized
to sell.

Aggrieved, New Vista interposed an appeal before the Court of Appeals. The CA reversed the decision of
the RTC and reinstated New Vista’s amended complaint for quieting of title, and directing Vitangcol and
Maria Alipit to file their respective answers. The CA concluded that the RTC erred in looking beyond the
four corners of the amended complaint in resolving the motion to dismiss on the ground of its failing to
state a cause of action. It held that the real question in the case boiled down as to whose title is genuine
or spurious. CA denied Vitangcol's motion for reconsideration.

Issue:

Whether or not the decision and the resolution of the Court of Appeals under challenge (consideration
of the amended complaint) are contrary to law.

RULING:

The petition is bereft of merit. The amended complaint sufficiently states a cause of action. Lack of cause
of action is, however, not a ground for a dismissal of the complaint through a motion to dismiss under
Rule 16 of the Rules of Court, for the determination of a lack of cause of action can only be made during
and/or after trial. What is dismissible via that mode is failure of the complaint to state a cause of action.
Sec. 1(g) of Rule 16 of the Rules of Court provides that a motion may be made on the ground "that the
pleading asserting the claim states no cause of action." The trial court erred in ruling that, taking said SPA
into account, the amended complaint stated no cause of action. Upon a consideration of the amended
complaint, its annexes, with the June 18, 1989 SPA submitted, the Court is inclined, in the main, to agree
with the appellate court that the amended complaint sufficiently states a cause of action.

WHEREFORE, this petition is hereby DENIED for lack of merit. The records of the case are immediately
remanded to the RTC, Branch 35 in Calamba City, Laguna for appropriate action on the Compromise
Agreement submitted by the parties.
3) G.R. No. 107112 February 24, 1994

NAGA TELEPHONE CO., INC. (NATELCO) AND LUCIANO M. MAGGAY, petitioners,

vs.

THE COURT OF APPEALS AND CAMARINES SUR II ELECTRIC COOPERATIVE, INC. (CASURECO II),
respondents.

Ponente: NOCON, J.:

Facts

Naga Telephone Co., Inc. (NATELCO), petitioner, is a telephone company rendering local as well as long
distance telephone service in Naga City while private respondent Camarines Sur II Electric Cooperative,
Inc. (CASURECO II) is a private corporation established for the purpose of operating an electric power
service in the same city. On November 1, 1977, the parties entered into a contract for the use by
petitioners in the operation of its telephone service, the electric light posts of private respondent in Naga
City. In consideration, petitioners agreed to install, free of charge, ten (10) telephone connections for the
use by private respondent. The term or period of the contract shall be as long as the party of the first part
has need for the electric light posts of the party of the second part it being understood that this contract
shall terminate when for any reason whatsoever, the party of the second part is forced to stop, abandoned
its operation as a public service and it becomes necessary to remove the electric lightpost.

After the contract had been enforced for over ten (10) years, private respondent filed on January 2, 1989
with the Regional Trial Court of Naga City, a case against petitioners for reformation of the contract with
damages, on the ground that it is too one-sided in favor of petitioners (first cause of action). As second
cause of action, private respondent alleged that starting with the year 1981, petitioners have used 319
posts in the towns of Pili, Canaman, Magarao and Milaor, Camarines Sur, all outside Naga City, without
any contract with it; that at the rate of P10.00 per post, petitioners should pay private respondent for the
use thereof the total amount of P267,960.00 from 1981 up to the filing of its complaint; and that
petitioners had refused to pay private respondent said amount despite demands. And as third cause of
action, private respondent complained about the poor servicing by petitioners of the ten (10) telephone
units which had caused it great inconvenience and damages to the tune of not less than P100,000.00.

In petitioners' answer to the first cause of action, they averred that it should be dismissed because (1) it
does not sufficiently state a cause of action for reformation of contract; (2) it is barred by prescription,
the same having been filed more than ten (10) years after the execution of the contract; and (3) it is barred
by estoppel, since private respondent seeks to enforce the contract in the same action. Petitioners further
alleged that their utilization of private respondent's posts could not have caused their deterioration
because they have already been in use for eleven (11) years; and that the value of their expenses for the
ten (10) telephone lines long enjoyed by private respondent free of charge are far in excess of the amounts
claimed by the latter for the use of the posts, so that if there was any inequity, it was suffered by them.
Regarding the second cause of action, petitioners claimed that private respondent had asked for
telephone lines in areas outside Naga City for which its posts were used by them; and that if petitioners
had refused to comply with private respondent's demands for payment for the use of the posts outside
Naga City, it was probably because what is due to them from private respondent is more than its claim
against them. For the third cause of action, petitioners claimed, that their telephone service had been
categorized by the National Telecommunication Corporation (NTC) as "very high" and of "superior
quality."

The RTC decided ordering for the reformation of the agreement and ordering NATELCO to pay the sum of
TEN (P10.00) PESOS per plaintiff's pole, per month beginning January 1989 and ordering also the plaintiff
to pay defendant NATELCO the monthly dues of all its telephones including those installed at the residence
of its officers. Disagreeing with RTC’s judgment, petitioners appealed to the Court of Appeals. The Court
of appeals affirmed the decision of the trial court, but based on different grounds to wit: (1) that Article
1267 of the New Civil Code is applicable and (2) that the contract was subject to a potestative condition
which rendered said condition void. The motion for reconsideration was denied.

ISSUES

1. Is Article 1267 applicable?

2. Has the filing of reformation of contract prescribed?
3. Is the period of contract, “as long as the party of the first part has need for electric light posts…”
potestative?

RULING

1. Yes. Art. 1267 states that: “When the service has become so difficult as to be manifestly beyond
the contemplation of the parties, the obligor may also be released therefrom, in whole or in part.”
Contract was one-sided unfair, and disadvantageous to plaintiff.
2. No. Prescription has not yet lapse. What is reformed is not the contract itself, but the instrument
embodying the contract. It follows that whether the contract is disadvantageous or not is
irrelevant to reformation and therefore, cannot be an element in the determination of the period
for prescription of the action to reform. Article 1144: Action upon a written contract must be
brought within 10 years from the time the right of action accrues. The following points should be
considered: i) “From the time the right of action accrues” not necessarily the date of execution of
the contract. ii) As correctly ruled by respondent court, private respondent's right of action arose
"sometime during the latter part of 1982 or in 1983 when according to Atty. Luis General, Jr. . . .,
he was asked by (private respondent's) Board of Directors to study said contract as it already
appeared disadvantageous to (private respondent) in 1989. iii) when the complaint in this case
was filed, 10 years had not yet elapsed.
3. Yes. Period of contract is potestative, thus invalid. Petitioners' allegations must be upheld in this
regard. A potestative condition is a condition, the fulfillment of which depends upon the sole will
of the debtor, in which case, the conditional obligation is void.

WHEREFORE, the petition is hereby DENIED. The decision of the Court of Appeals dated May 28,
1992 and its resolution dated September 10, 1992 are AFFIRMED.
4) G.R. No. 159831 October 14, 2005

PILIPINAS SHELL PETROLEUM CORPORATION, Petitioner

Vs.

JOHN BORDMAN LTD. OF ILOILO, INC., Respondent

Ponente: PANGANIBAN, J.:

The Case

This is a petition for Review under Rule 45 of the Rules of Court, assailing the August 20, 2002 Decision
and August 29, 2003 Resolution of the Court of Appeals (CA) in CA-GR CV No. 46974 which affirmed with
modification the decision of the RTC Branch 26, Manila in Civil Case No. 13419.

Facts

Petitioner Pilipinas Shell Petroleum Corporation (Pilipinas Shell) is a corporation engaged in the business
of refining and processing petroleum products. The invoicing of the products was made by Pilipinas Shell,
but delivery was effected through Arabay, Inc., its sole distributor at the time material to the present
case.From 1955 to 1975, Respondent John Bordman Ltd. of Iloilo, Inc. (John Bordman) purchased bunker
oil in drums from Arabay. When Arabay ceased its operations in 1975, Pilipinas Shell took over and directly
marketed its products to John Bordman.

On August 20, 1980, John Bordman filed against Pilipinas Shell a civil case for specific performance. The
former demanded the latters short deliveries of fuel oil since 1955; as well as the payment of exemplary
damages, attorneys fees and costs of suit.John Bordman alleged that Pilipinas Shell and Arabay had billed
it at 210 liters per drum, while other oil companies operating in Bacolod had billed their customers at 200
liters per drum. On July 24, 1974, when representatives from John Bordman and Arabay conducted a
volumetric test to determine the quantity of fuel oil actually delivered, the drum used could only fill up to
190 liters, instead of 210 liters, or a short delivery rate of 9.5%. After this volumetric test, Arabay reduced
its billing rate to 200 (instead of 210) liters per drum, except for 4 deliveries between August 1 and
September 9, 1974, when the billing was at 190 liters per drum. On January 23, 1975, another volumetric
test allegedly showed that the drum could contain only 187.5 liters. On October 24, 1977 and November
9, 1977, representatives from John Bordman, the auditor of the Iloilo City Commission on Audit, pump
boat carriers, and truck drivers conducted actual measurements of fuel loaded on tanker trucks as
transferred to dented drums at mouth full. They found that the drums could contain 180 liters only. In its
Complaint, John Bordman prayed for the appointment of commissioners to ascertain the volume of short
deliveries.

On October 21, 1980, Pilipinas Shell and Arabay filed their Answer with Counterclaim. They specifically
denied that fuel oil deliveries had been less than those billed. Moreover, the drums used in the volumetric
tests were allegedly not representative of the ones used in the actual deliveries.By way of affirmative
defense, Pilipinas Shell and Arabay countered that John Bordman had no cause of action against them. If
any existed, it had been waived or extinguished; or otherwise barred by prescription, laches, and estoppel.
During the pretrial, the parties agreed to limit the issues to the following: (1) whether the action had
prescribed, and (2) whether there had been short deliveries in the quantities of fuel oil. John Bordman’s
Motion for Trial by Commissioner was granted by the RTC, and the court-appointed commissioner
submitted her Report on April 20, 1988. On April 3, 1989, Pilipinas Shell and Arabay filed a Motion for
Resolution of their affirmative defense of prescription. Because prescription had not been established
with certainty, the RTC ordered them to present evidence in support of their defense.

On August 30, 1991, the RTC issued a Decision in favor of respondent, John Bordman, and required
Pilipinas Shell and Arabay to deliver to John Bordman 916,487.62 liters of bunker fuel oil, to pay actual
damages of P1,000,000; exemplary damages of P500,000; attorney’s fees of P500,000; and the costs of
suit. Upon appeal to the Court of Appeals, it affirmed the decision of the RTC.

ISSUES:

1. Whether or not there was a valid verification and certification against forum shopping.
2. Was there a grave abuse of discretion based as they are on an unmistakable misappreciation of
facts clearly appearing in the records of the case?
3. Did the court a quo, as well as the Honorable Court of Appeals, gravely erred in not ruling that
respondent’s claims of alleged short deliveries for the period 1955 to 1976 were already barred
by prescription?
4. Did the Honorable Court of Appeals and the court a quo erred in not ruling that respondents
claims are barred by estoppel and laches considering that respondent failed to assert its claim for
about twenty-five (25) years?
5. The Honorable Court of Appeals erred in awarding to respondent compensatory damages,
exemplary damages, attorney’s fees and cost of suit, when petitioner has not otherwise acted in
a wanton, fraudulent, reckless, oppressive or malevolent manner.

RULING:

The Petition has no merit, except in regard to the CA’s grant of exemplary damages.
1. Yes. The petitioners verification and certification against forum shopping had been complied with,
and were in fact made in accordance with, Section 4 of Rule 45 of the Rules of Court. Respondent
alleges that Romeo B. Garcia, vice-president of Pilipinas Shell, had no authority to execute them. The
records, however, show that petitioners president conferred upon its vice-president the power to
institute actions. As certified by the assistant board secretary, the delegation was authorized by
petitioners board of directors. The power to institute actions necessarily included the power to
execute the verification and certification against forum shopping, as required in a petition for review
before this Court. In any event, the policy of liberal interpretation of procedural rules compels us to
give due course to the Petition.
2. As a general rule, questions of fact may not be raised in a petition for review. The factual findings of
the trial court, especially when affirmed by the appellate court, are binding and conclusive on the
Supreme Court. Nevertheless, this rule has certain exceptions, which petitioner asserts are present
in this case. The Court reviewed the evidence presented and revisited the applicable pertinent rules.
The issue, therefore, relates not to the submission of evidence, but to its weight and credibility. While
petitioner may have submitted evidence, it failed to disprove the short deliveries. From the foregoing
observations, it is apparent that the evidence presented by both parties preponderates in favor of
 respondent. The fact remains that Pilipinas Shell [petitioner] failed to overcome the burden of
proving that indeed the drums used during the deliveries contain 210 liters and it failed to disprove
the results of the volumetric tests.
3. The claim has not prescribed. Said obligation arises from a contract of sale, thus any action to enforce
a breach of that Contract prescribes in ten years. Actions based upon a written contract should be
brought within ten years from the time the right of action accrues. This accrual refers to the cause
of action, which is defined as the act or the omission by which a party violates the right of another.
The period of prescription commences, not from the date of the execution of the contract, but from
the occurrence of the breach. Buyer dependence is common in many ordinary sale transactions, as
when gasoline is loaded in the gas tanks of motor vehicles, and when beverage is purchased in bottles
and ice cream in bulk containers. In these cases, the buyers rely, to a considerable degree, on the
sellers representation that the agreed volumes are being delivered. They are no longer expected to
make a meticulous measurement of each and every delivery. To the mind of this Court, the cause of
action in the present case arose on July 24, 1974, when respondent discovered the short deliveries
with certainty. It was only after the discovery of the short deliveries that respondent got into a
position to bring an action for specific performance. Evidently then, that action was brought within
the prescriptive period when it was filed on August 20, 1980.
4. The claim is not barred by estoppel by laches. Estoppel by laches is the failure or neglect for an
unreasonable length of time to do that which, by the exercise of due diligence, could or should have
been done earlier. Otherwise stated, negligence or omission to assert a right within a reasonable
time warrants a presumption that the party has abandoned or declined the right. This principle is
based on grounds of public policy, which discourages stale claims for the peace of society.
Respondent cannot be held guilty of delay in asserting its right during the time it did not yet know of
the short deliveries. The facts in the present case show that after the discovery of the short deliveries,
it immediately sought to recover the undelivered fuel from petitioner. Laches refers, inter alia, to the
length of time in asserting a claim. The Court, therefore, agrees with the lower courts that
respondents claim was not lost by laches.

5. The exemplary damages with regards this case is not proper. Exemplary damages are imposed as a
corrective measure. When the guilty party has acted in a wanton, fraudulent, reckless, oppressive,
or malevolent manner. These damages are awarded in accordance with the sound discretion of the
court. Absent any showing of bad faith on the part of petitioner, exemplary damages cannot be
imposed upon it. But the grant of attorney’s fees is allowed.

WHEREFORE, the Petition is hereby DENIED. The assailed Decision and Resolution are AFFIRMED with
the slight MODIFICATION that the award of exemplary damages is deleted. Costs against petitioner.