The document discusses several cases related to rescission of contracts under Article 1381(4) of the Civil Code.
In the Heirs of Quirong case, the court found that the action for rescission brought by the heirs had prescribed, as more than 4 years had passed. In Ada v. Baylon, the court ruled that the donation inter vivos could be rescinded under Article 1381(4) as it was made without knowledge or approval of the litigants during a pending case.
In Anchor Savings Bank v. Furigay, the court dismissed the complaint for rescission as premature since the plaintiff had not yet exhausted other legal means or rights of the debtor to obtain repayment. The
The document discusses several cases related to rescission of contracts under Article 1381(4) of the Civil Code.
In the Heirs of Quirong case, the court found that the action for rescission brought by the heirs had prescribed, as more than 4 years had passed. In Ada v. Baylon, the court ruled that the donation inter vivos could be rescinded under Article 1381(4) as it was made without knowledge or approval of the litigants during a pending case.
In Anchor Savings Bank v. Furigay, the court dismissed the complaint for rescission as premature since the plaintiff had not yet exhausted other legal means or rights of the debtor to obtain repayment. The
The document discusses several cases related to rescission of contracts under Article 1381(4) of the Civil Code.
In the Heirs of Quirong case, the court found that the action for rescission brought by the heirs had prescribed, as more than 4 years had passed. In Ada v. Baylon, the court ruled that the donation inter vivos could be rescinded under Article 1381(4) as it was made without knowledge or approval of the litigants during a pending case.
In Anchor Savings Bank v. Furigay, the court dismissed the complaint for rescission as premature since the plaintiff had not yet exhausted other legal means or rights of the debtor to obtain repayment. The
The document discusses several cases related to rescission of contracts under Article 1381(4) of the Civil Code.
In the Heirs of Quirong case, the court found that the action for rescission brought by the heirs had prescribed, as more than 4 years had passed. In Ada v. Baylon, the court ruled that the donation inter vivos could be rescinded under Article 1381(4) as it was made without knowledge or approval of the litigants during a pending case.
In Anchor Savings Bank v. Furigay, the court dismissed the complaint for rescission as premature since the plaintiff had not yet exhausted other legal means or rights of the debtor to obtain repayment. The
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HEIRS OG QUIRONG V DBP
The decision became final and executor on January 28, 1993 when the DBP failed to appeal from it within the time set for such appeal.
Was the action of the Quirong heirs “for rescission” or “upon a written contract”?
For RESCISSION since their complaint asked for the rescission of the contract of sale between Sofia Quirong, their predecessor, and the DBP and the reimbursement of the price of 78K that Sofia paid the bank plus damages. The prescriptive period for rescission is 4 years. Thus, the action for rescission has already prescribed And that action for rescission, which is based on a subsequent economic loss suffered by the buyer, was precisely the action that the Quirong heirs took against the DBP.
Thus, the action for rescission has already prescribed
ADA V BAYLON Whether the donation inter vivos of Florante may be rescinded pursuant to Article 1381 (4) of the Civil Code on the ground that the same was made during the pendency of the action for partition with the RTC -Rescission is a remedy to address the damage or injury caused to the contracting parties or third persons -Contracts which refer to things subject of litigation is rescissible pursuant to Article 1381 (4) of the Civil Code -The rescission of a contract under Article 1381 (4) of the Civil Code only requires the concurrence of the following 1. The defendant, during the pendency of thecase enters into a contract which refers to the thing subject of litigation 2. The said contract was entered into without the knowledge and approval of the litigants or of a competent judicial authority. As long as the foregoing requisites concur, it becomes the duty of the court to order the rescission of the said contract -Any disposition of the thing subject of litigation or any act which tends to render inutile the court’s impending disposition in such case, sans the knowledge and approval of the litigants or of the court, is unmistakably and irrefutably indicative of bad faith. Such acts undermine the authority of the court to lay down the respective rights of the parties in a case relative to the thing subject of litigation and bind them to such determination. -Although the gratuitous conveyances of the said parcels of land in favor of Florante was valid, the donation inter vivos of the same being merely an exercise of ownership, Rita’s failure to inform and seek the approval of the petitioners or the RTC regarding the conveyance gave the petitioners the RIGHT TO HAVE THE SAID DONATION RESCINDEN PURSUANT TO ART. 1381 (4) -Even if the defendant effected the conveyance without the knowledge and approval of the litigants or of a competent judicial authority. The absence of such knowledge or approval would not precipitate the invalidity of an otherwise valid contract. Nevertheless, such contract, though considered VALID, MAY BE RESCINDED AT THE INSTANCE OF THE OTHER LITIGANTS PURSUANT TO ART 1381 ($) OF THE CIVIL CODE.
ISSUE: Whether the donation inter vivos in favor of Florante may only be rescinded if there is already a judicial determination that the same actually belonged to the estate of Spouses Baylon
-RESCISSION UNDER ARTICLE 1381 (4) OF THE CC IS NOT PRECONDITIONED UPON THE JUDICIAL DETERMINATION AS TO THE OWNERSHIP OF THE THING SUBJECT OF LITIGATION -The petitioner’s right to institute action for rescission pursuant to Art 1381 (4) is not PRECONDITIONED upon the RTC’s determination as to the ownership of the said parcels of land -A DEFINITIVE JUDICIAL DETERMINATION WITH RESPECT TO THE THING SUBJECT OF LITIGATION IS NOT A CONDITION SINE QUA NON BEFORE THE RESCISSORY ACTION CONTEMPLATED UNDER ART 1381 (4) MAY BE INSTITUTED ANCHOR SAVINGS BANK V FURIGAY
Whether ASB’s complaint on the ground that the action against respondents was PREMATURE
-YES -Action for rescission, it should be noted that the remedy of rescission is subsidiary in nature; It cannot be instituted except when the party suffering damage has no other legal means to obtain reparation for the same -Following the subsidiary nature of remedy of rescission, a creditor would have a cause of action to bring an action for rescission, if it is alleged that the following successive measures have already been taken 1. Exhaust the properties through levying by attachment and execution upon all the property of the debtor, except such as are exempt by law from execution 2. Exercise all the rights and actions of the debtor, save those personal to him 3. Seek rescission of the contract executed by the debtor in fraud of their rights (accion pauliana)
With respect to accion pauliana, it is required that the ultimate facts constituting the following requisites must all be alleged in the complaint
1. That the plaintiff asking for rescission, has credit prior to alienation, although demandable later 2. That the debtor has made a subsequent contract conveying a patrimonial benefit to a third person 3. That the creditor has no other legal means to satisfy his claim but would benefit by rescission of the conveyance to the third person 4. That the act being impugned is fraudulent 5. That the third person who received the property conveyed, if by onerous title, has been an accomplice to the fraud A cursory reading of the allegations of ASB’s complaint would show that it failed to allege the ultimate facts constituting its cause of action and the prerequisites that must be complied for the same may be instituted. ASB, without availing the first and second remedies, that is, exhausting the properties of the respondents or their transmissible rights and actions, simply undertook the third measure and filed an action for annulment of the donation. This cannot be done.
KHE HONG CHENG V CA
It is clear that the 4 year prescriptive period commences to run neither from the date of the registration of the deed sought to be rescinded nor from the date the trial court but from the DAY IT HAS BECOME CLEAR THAT THERE NO OTHER LEGAL REMEDIES BY WHICH THE CREDITOR CAN SATISFY HIS CLAIMS.
MENDIZONA V OZAMIZ DOMINGO V CA
Whether Carmen Ozamiz’s mental faculties were seriously impaired when she executed the said contract -The Deed of Absolute Sale is a notarized document duly acknowledged before a notary public. As such, it has in its favor the presumption of regularity, and carries the evidentiary weight conferred upon it with respect to its due execution and the notarized deed shows on its face that the consideration of 1M was acknowledged to have been received by Carmen Ozaminz -Simulation cannot be inferred from the alleged absence of payment based on the testimonies. Such testimonies hardly reserve any credit and -Spoken words could be notoriously unreliable as against a written document that speaks a uniform language -After a thorough scrutiny of the transcripts of the testimonies of the witnesses, the court finds that the respondents’ core witnesses all made sweeping statements which FAILED TO SHOW THE TRUE STATE OF MIND OF CARMEN OZAMIZ at the time of the execution of the disputed document. The testimonies of the respondents’ witnesses on the mental capacity of Carmen Ozamiz are far from being clear and convincing -Testimonies were: >That Carmen understood the question in connection with the SALE of Lahug Property >Carmen could not fully understand the things around her, that she was physically fit but mentally could not carry a conversation or recognize persons who visited her >Dr. Go did not also shed light on the mental capacity of Carmen. She merely revealed that Carmen was suffering from certain infirmities in her body and at times, she was forgetful, but there was no categorical statement that Carmen succumbed to what the respondents suggest as her alleged “second childhood” -It has been held that A PERSON IS NOT INCAPACITATED MERELY BECAUSE OF ADVANCED YEARS OR BY REASON OF PHYSICAL INFIRMITIES. ONLY WHEN SUCH AGE OR INFIRMITIES IMPAIR HER MENTAL FACULTIES TO SUCH EXTENT AS TO PREVENT HER FROM PROPERTLY, INTELLIGENTLY, AND FAIRLY PROTECTING HER PROPERTY RIGHTS, IS SHE CONSIDERED INCAPACITATED. -respondents utterly failed to show adequate proof that at the time of the sale Carmen had allegedly lost control of her mental faculties. -Respondents sought to impugn only one document which is the DOAS however there are 9 other important documents that were signed by Carmen which were not assailed by the respondents. SUCH IS CONTRARY TO THEIR ASSERTION OF COMPLETE INCAPACITY OF CARMEN TO HANDLE HER AFFAIRS.. “It is unfair for the respondents to claim soundness of mind of Carmen when it benefits them and otherwise when it disadvantages them.
