1D Guico LTL

Guico, Ramon Carlo C.
LEGTECH
1-D
Inductive Reasoning Exercise 1

Conduct a survey of Philippine Jurisprudence on unconscionable rate of interest on loans.
Derive a general rule as to what rate of interest which would make it unconscionable in
character. Cite the cases as premises and thereafter, derive the General Rule based thereon as
your Conclusion.
Premise 1: In the case of De la Paz v. L & J Development Company (G.R. No. 183360,
September 8, 2014), the Supreme Court ruled that the levy of a 6% monthly interest or 72%
interest per annum is “definitely outrageous and inordinate”. Therefore, the said interest was
made void and was considered as unconscionable by the Court.
Premise 2: In the case of Isla, et. al. v. Estroga (G.R. No. 233974, July 02, 2018), the Supreme
Court ruled that the 10% monthly interest was unconscionable and was struck down as void. It
was then reduced to a 1% monthly interest or 12% per annum interest.
Premise 3: In the case of Spouses Abella v. Spouses Abella (G.R. No. 195166, Juky 8, 2015)
the Supreme Court ruled that the imposition of 2.5% monthly interest or 30% interest per annum
is deemd unconscionable even when such is stipulated in the contract.
Premise 4: In the case of Medel v. Court of Appeals (G.R. No. 168940, November 27, 1998),
the Supreme Court ruled that it is unconscionable to have a loan of 5.5% monthly interest or 66%
interest per annum. The loan is deemed void.
Premise 5: In the case of Solangon v. Salazar (G.R. No. 125944, June 29, 2001), the Supreme
Court held that the alleged 6% monthly interest or 72% interest per annum is definitely
unconscionable and must be reduced to 12% interest per annum in order to be deemed fair.
Conclusion: Based on the aforementioned cases, it can be concluded that interest rates are
considered unconscionable if it exceeds the legal interest rate of 1% per month or 12% per
annum.
Reasoning by Analogy Exercise
I
Arnold is an employee in a company. He stole the bag of Andrea, his co-employee. Can Arnold’s
conduct of stealing the bag of Andrea be considered analogous to serious misconduct in
connection with his work and thereby a ground for his dismissal from work? Justify your
answer.
Answer: Yes, the act of Arnold stealing the bag of Andrea is analogous to serious misconduct in
connection with his work. Therefore, it is a ground for his dismissal.
Under the Labor Code, there are valid grounds to terminate the employment of employees.
Article 297 (previously Art. 282). Termination by employer. – An employer may

terminate an employment for any of the following causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of
his employer or representative in connection with his work;
XXX
(e) Other causes analogous to the foregoing.
While it is true that under the aforementioned law, Arnold did not commit serious misconduct or
willful disobedience against his employer. However, an analogy may be used to extend the
interpretation of the law in order to be in consonance with justice, such as the case at hand.
Under the case of Cosmos Bottling Corp v. Fermin, theft committed by an employee against a
person other than his employer, is a cause analogous to serious misconduct.
II
1.) Read the case of De Leon v. Soriano (G.R. No. L-7648, 17 September 1954) and state
the factor/s used by the Supreme Court in partially affirming the decision of the appellate
court to allow execution of the judgement of the lower court pending approval.
Answer: The factors used by the Supreme Court in partially affirming the decision of the
appellate court to allow such execution is the present situation and circumstances of the
surviving spouse, Asuncion. The Supreme court states that “the herein plaintiff is an old woman
of 75 years, sickly, and without any means of living, are all in the opinion of the court strong
grounds to justify the execution of the judgement in spite of the superseadeas bond, because the
right of the plaintiff to live and to pursue her happiness are paramount right which outweigh the
security offered by the superseades bond.”
The Supreme Court considered the old age of Asuncion and thus, partially affirmed the
decision of the appellate court. As an old woman of 75 years of age she may not be able to enjoy
the benefits of her winnings if she still has to wait years before the case is finally terminated.
2.) Would the decision of the court be applicable if the age of the plaintiff which filed a
Motion for execution pending appeal is only 73?
Answer: Yes, the decision of the court would still be the same even if the plaintiff’s age be only
73. Such age of 73 is still considered an age well above to be a senior citizen. Furthermore, apart
from the age consideration in the case, the court would still consider that Asuncion is an old
woman with deteriorating health and has no mean to support herself. She may not still be able to
enjoy her winnings if she still has to wait for the case to be terminated.
3.) What if the plaintiff is a billionaire but is already 80 years old?

Answer: No, the rich status of the plaintiff would change the court’s decision. The court ruled in
the case that the reason to overturn the superseades bond was because of the poor financial status
of the plaintiff. Since he definitely has means to support himself, the decision would have been
overturned.
4.) Would the decision of the court be applicable if the plaintiff in the case is only 40 years
old but he, however, is suffering from Lung Cancer, Stage 4?
Answer: Yes, the decision of the court would be applicable. The case at bar would be considered
as analogous to the present case. The case at bar tells that the court partially affirmed the
decision of the court due to the reason that the plaintiff is sick and was nearing the end of his
lifespan. In the present case, even if the plaintiff is only 40 years old, he still suffers the same
situation of being sickly and has a high chance of dying due to his Stage 4 Lung Cancer.
The court, like in the case at bar, should have the same decision. Not only it would
enable the plaintiff the enjoy his rewards, but also be used as financial expenses to pay for his
medication.

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Guico, Ramon Carlo C.

Inductive Reasoning Exercise 1

Article 297 (previously Art. 282). Termination by employer. – An employer may

3.) What if the plaintiff is a billionaire but is already 80 years old?

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