Case 1 – EQUATORIAL & CARMELO v MAYFAIR THEATER

 Art. 1324. – When the offerer has allowed the offeree a certain period to accept, the offer may be withdrawn at
any time before acceptance, except when the option is founded upon a consideration, as something paid or
promised.
 Art. 1479 – An accepted unilateral promise to buy or to sell a determinate thing for a price certain is binding
upon the promissor if the promise is supported by a consideration distinct from the price. Observe, however,
that the option is not the contract of sale itself. The optionee has the right, but not the obligation.
 The main issue here is that the option in the contract of lease is not supported by a separate consideration,
therefore, produce no effect. However, under this case, it is not an option clause or an option contract (Art.
1324 & Art. 1479), but a contract of a right of first refusal, which is an integral part of a lease contract. The
consideration is built into the reciprocal obligation of the parties.
 Option contract is one giving a person for a consideration a certain period within which to accept the offer of
the offerer. It is separate and distinct from the contract which will be perfected upon the acceptance of the
offer. To be valid and enforceable, it must indicate a definite price at which the person granting the option is
willing to sell.
 What was agreed was that Mayfair will have the right of first refusal in the event Carmelo sells the leased
premises. There was even an exchange of letters evidencing the offer and counter-offers made by both
parties. However, Carmelo did not pursue the exercise to its logical end. While it initially recognized Mayfair's
right of first refusal, Carmelo violated such right when without affording its negotiations with Mayfair the full
process to ripen to at least an interface of a definite offer and a possible corresponding acceptance within the
30-day exclusive option time granted Mayfair, Carmelo abandoned negotiations, and then sold without prior
notice to Mayfair, the entire property to Equatorial.
 The rights of first refusal should include not only the property specified in the contracts but also the
appurtenant portions sold to Equatorial. The boundaries of the properties sold should be the boundaries of the
offer under the right of first refusal.
 Since Equatorial is a buyer in bad faith, this finding renders the sale to it of the property in question rescissible.
Equatorial was aware of the lease contracts because its lawyers had, prior to the sale, studied the said
contracts. As such, Equatorial cannot tenably claim to be a purchaser in good faith, and, therefore, rescission
lies.
 Rescission is a remedy granted by law to the contracting parties and even to third persons, to secure reparation
for damages caused to them by a contract, even if this should be valid, by means of the restoration of things to
their condition at the moment prior to the celebration of said contract. It is a relief allowed for the protection
of one of the contracting parties and even third persons from all injury and damage the contract may cause, or
to protect some incompatible and preferential right created by the contract.

Case 2 – HEIRS OF LUIS BACUS v CA & FAUSTINO DURAY

 Petitioners contend that the respondents failed to comply with their obligation because there was no actual
delivery of the of payment before the contract expired. According to them, arrangements being made by the
bank to the release the money as loan cannot be considered as legal tender that may substitute for delivery of
payment to lessor. Obligations under an option to buy are reciprocal obligations. The performance of one
obligation is conditioned on the simultaneous fulfillment of the other obligation. In other words, in an option to
buy, the payment of the purchase price by the creditor is contingent upon the execution and delivery of a
deed of sale by the debtor.
 In this case, when private respondents opted to buy the property (agricultural land), their obligation was to
advise petitioners of their decision and their readiness to pay the price. They were not yet obliged to make
actual payment. Only upon petitioners' actual execution and delivery of the deed of sale where they are
required to pay. Notice of the creditor's decision to exercise his option to buy need not be coupled with
actual payment of the price, so long as this is delivered to the owner of the property upon performance of his
part of the agreement.
 Consignation is the act of depositing the thing due with the court or judicial authorities whenever the creditor
cannot accept or refuses to accept payment and it generally requires a prior tender of payment. Consequently,
since the obligation was not yet due, consignation in court of the purchase price was not yet required.
  Private respondents did not incur in delay when they did not yet deliver payment nor make a consignation
before the expiration of the contract. In reciprocal obligations, neither party incurs in delay if the other does
not comply or is not ready to comply in a proper manner with what is incumbent upon him. Only from the
moment one of the parties fulfills his obligation, does delay by the other begin.
 In this case, respondents communicated to petitioners their intention to buy the property and they were at that
time undertaking to meet their obligation before the expiration of the contract. However, petitioners refused to
execute the deed of sale and it was their demand to first deliver the money before they would execute the
same which prompted private respondents to institute a case for specific performance in the RTC. After the
case had been submitted for decision but before the trial court rendered its decision, private respondents
issued a cashier's check in petitioners' favor purportedly to bolster their claim that they were ready to pay
the purchase price. The trial court considered this in private respondents' favor and we believe that it rightly
did so, because at the time the check was issued, petitioners had not yet executed a deed of sale nor expressed
readiness to do so. Accordingly, as there was no compliance yet with what was incumbent upon petitioners
under the option to buy, private respondents had not incurred in delay when the cashier's check was issued
even after the contract expired.

Case 3 – MATAAS NA LUPA TENANTS & AGLABAY v DIMAYUGA & DE GABRIEL

 RA 3516 clearly defines that no lot or portion actually occupied by a tenant or occupant shall be sold by the
landowner to any other person than such tenant or occupant, unless the latter renounce in a public
instrument his rights. The provision clearly defines the preferential rights of petitioners to buy the parcel of
land. It should be noted that respondent de Gabriel voluntarily sold the land to Dimayuga without informing
the petitioners of the transaction. De Gabriel did not give the first offer to petitioners who were then tenants-
lessees and who would have either accepted or refused to buy the land in a public document. Evidently, said
sale was made illegally and, therefore, void.
 The test for a valid expropriation of private land for resale to its occupants, is the number of families to be
benefited and not the area. What petitioners might have failed to realize is that had they invoked the
expropriability of subject land, they would have had a foolproof case. However, instead of anchoring their case
on the expropriability of such land, they concentrated on asserting their preferential right to buy the land.
 RA 1162, as amended by RA 3516, specifically authorizes the expropriation of any piece of land in the City of
Manila, Quezon City and suburbs which have been and are actually being leased to tenants for at least ten (10)
years, provided said lands have at least forty families of tenants thereon. The case at bar comes within the
coverage of the aforesaid legal provision since the parcel of land is located in Manila which was then actually
leased to 110 tenant families 20 years prior to the commencement of this action in the lower court. Clearly, the
land in question is capable of expropriation.
 The taking to be valid must be for public use. Whatever project is undertaken must be for the public to enjoy,
as in the case of streets or parks. Otherwise, expropriation is not allowable. It is not so any more. As long as the
purpose of the taking is public, then the power of eminent domain comes into play. As just noted, the
Constitution in at least two cases, determines what is public use. One is the expropriation of lands to be
subdivided into small lots for resale at cost to individuals. The other is the transfer, though the exercise of
this power, of utilities and other private enterprise to the government. It is accurate to state then that at
present whatever may be beneficially employed for the general welfare satisfies the requirement of public use.
 Furthermore, PD No. 1517 (supersedes RA 1162 and 3516) states that the Urban Zones, including the said land,
legitimate tenants who have resided on the land for ten years or more who have built their homes on the land
and residents who have legally occupied the lands by contract, continuously for the last ten years shall not be
dispossessed of the land and shall be allowed the right of first refusal to purchase the same within a
reasonable time and at reasonable prices.

Case 4 – HOSPICIO DE SAN JOSE v DEPARTMENT OF AGRARIAN REFORM

 Section 4 of Act No. 3239 provides that the personal and real property donated to the Hospicio by its founders
or by other persons shall not be sold under any. But the land transfers mandated under P.D. No. 27 cannot be
considered a conventional sale under our civil laws. In this case, the deprivation of the Hospicio's property did
not arise as a consequence of the Hospicio's consent to the transfer. Instead, the obligation to transfer arises by
compulsion of law, particularly P.D. No. 27. It cannot refer to sales or dispositions that arise by operation of
 law, such as through judicial execution, or, as in this case, expropriation. Act No. 3239 is repealed by PD No. 27
and the Comprehensive Agrarian Reform Law (CARL).
 Agrarian reform is justified under the State's inherent power of eminent domain that enables it to forcibly
acquire private lands intended for public use upon payment of just compensation to the owner. It has even
been characterized as beyond the traditional exercise of eminent domain, but a revolutionary kind of
expropriation.
 The twin process of expropriation of lands under agrarian reform and the payment of just compensation is akin
to a forced sale, which has been aptly described in common law jurisdictions as sale made under the process of
the court, and in the mode prescribed by law. The crucial question is whether the sale prohibited under Section
4 of Act No. 3239 includes even a forced sale. To answer, the contemporaneous construction of Section 4
indicates that the prohibition intended by the crafters of the law pertained only to conventional sales, and not
forced sales.
 The Hospicio claims it falls under the religious and charitable purposes. The terms charitable purposes and
charitable organization do not appear as exception in the CARL. Hospicio unduly assumes that charity is
integrally wedded to religiosity, despite the fact that there are charitable institutions that are avowedly secular
in orientation. Section 10 does not include properties which are generally used for charitable purposes , such
as orphanage. Not even all properties owned by religious institutions are exempt. Even assuming that the
Hospicio were actually owned and operated by the Catholic Church, it still would not be exempted from the
CARL.
 The viability of general repealing clauses, which are existent in both P.D. No. 27 29 and the CARL, as a means of
repealing all previous enactments inconsistent with revolutionary new laws. The presence of such general
repealing clause indicates the legislative intent to repeal all prior inconsistent laws on the subject matter,
whether the prior law is a general law or a special law, or a special private law.
 Hospicio claimed that P.D. No. 27 and the CARL violate the non-impairment of contracts clause under the Bill of
Rights. But, what is impaired is not actually a contract, but a legislative act. We have held that the State's
exercise of police powers may prevail over obligations imposed by private contracts. The provision was
intended to shield the impairment of obligations created by private agreements, and not by legislative fiat.

Case 5 – GREAT ASIAN SALES v CA & BANCASIA FINANCE

 In the ordinary course of business, a corporation can borrow funds or dispose of assets of the corporation only
on authority of the board of directors, to sign loan documents or deeds of assignment for the corporation. In
this case, the two board resolutions clearly authorize Great Asian to secure a loan or discounting line from
Bancasia.
 Great Asian claims that Arsenio signed the Deeds of Assignment in his personal capacity because Arsenio signed
above his printed name, below which was the word "Assignor", thereby making Arsenio the assignor. Great
Asian omits to state that the first paragraph of the Deeds expressly contains the following words: "the
ASSIGNOR, Great Asian Sales Center, represented by its Treasurer Arsenio Lim Piat, Jr." The assignor is
undoubtedly Great Asian, represented by its Treasurer, Arsenio.
 Discounting is a type of receivables financing whereby evidences of indebtedness of a third party, such as
installment contracts, promissory notes and similar instruments, are purchased by, or assigned to, a financing
company in an amount or for a consideration less than their face value.
 Bancasia's complaint against Great Asian is founded on the latter's breach of contract under the Deeds of
Assignment. There is one vital suspensive condition in the Deeds of Assignment. That is, in case the drawers fail
to pay the checks on maturity, Great Asian obligated itself to pay Bancasia the full-face value of the dishonored
checks, including penalty and attorney's fees. The failure of the drawers to pay the checks is a suspensive
condition, the happening of which gives rise to Bancasia's right to demand payment from Great Asian.
 As endorsee of Great Asian, Bancasia had the option to proceed against Great Asian under the Negotiable
Instruments Law. Had it so proceeded, the Negotiable Instruments Law would have governed Bancasia's cause
of action. Bancasia, however, did not choose this route. Instead, Bancasia decided to sue Great Asian for
breach of contract under the Civil Code, a right that Bancasia had under the express with recourse stipulation
in the Deeds of Assignment.
 The exercise by Bancasia of its option to sue for breach of contract under the Civil Code will not leave Great
Asian holding an empty bag. Great Asian, after paying Bancasia, is subrogated back as creditor of the
receivables. Great Asian can then proceed against the drawers who issued the checks. Even if Bancasia failed to
 give timely notice of dishonor, still there would be no prejudice whatever to Great Asian. Under the Negotiable
Instruments Law, notice of dishonor is not required if the drawer has no right to expect or require the bank
to honor the check, or if the drawer has countermanded payment . In the instant case, all the checks were
dishonored for any of the following reasons: "account closed", "account under garnishment", insufficiency of
funds", or "payment stopped". In the first three instances, the drawers had no right to expect or require the
bank to honor the checks, and in the last instance, the drawers had countermanded payment.
 Under common law, delay in notice of dishonor, where such notice is required, discharges the drawer only to
the extent of the loss caused by the delay. This rule finds application in this jurisdiction pursuant to Section
196 of the Negotiable Instruments Law which states, "Any case not provided for in this Act shall be governed by
the provisions of existing legislation, or in default thereof, by the rules of the Law Merchant." Under Section
186 of the Negotiable Instruments Law, delay in the presentment of checks discharges the drawer. However,
Section 186 refers only to delay in presentment of checks but is silent on delay in giving notice of dishonor.
 Great Asian, claims that the assignment of the checks is not a loan accommodation but a sale of the checks.
With the sale, ownership of the checks passed to Bancasia, which must now, according to Great Asian, sue the
drawers and indorser of the check who are the parties primarily liable on the checks. Great Asian forgets that
under the Deeds of Assignment, Great Asian expressly undertook to pay the full value of the checks in case of
dishonor. Again, we reiterate that this obligation of Great Asian is separate and distinct from its warranties as
indorser under the Negotiable Instruments Law.
 There is indeed a fine distinction between a discounting line and a loan accommodation. If the accounts
receivable, like postdated checks, are sold for a consideration less than their face value, the transaction is one
of discounting, and is subject to the provisions of the Financing Company Act. The assignee is immediately
subrogated as creditor of the accounts receivable. However, if the accounts receivables are merely used as
collateral for the loan, the transaction is only a simple loan, and the lender is not subrogated as creditor until
there is a default and the collateral is foreclosed.
 Article 1207 of the Civil Code provides, "There is a solidary liability only when the obligation expressly so states,
or when the law or nature of the obligation requires solidarity." The stipulations in the Surety Agreements
undeniably mandate the solidary liability of Tan Chong Lin with Great Asian. Moreover, the stipulations in the
Surety Agreements are sufficiently broad, expressly encompassing "all the notes, drafts, bills of exchange,
overdraft and other obligations of every kind which the PRINCIPAL may now or may hereafter owe the
Creditor."

Case 6 – CITY OF MANILA v IRENE STO. DOMINGO

 Under Philippine laws, the City of Manila is a political body corporate and as such endowed with the faculties of
municipal corporations to be exercised by and through its city government in conformity with law, and in its
proper corporate name. It may sue and be sued, and contract and be contracted with. Its powers are twofold in
character – public, governmental or political on the one hand, and corporate, private and proprietary on the
other. Governmental powers are those exercised in administering the powers of the state and promoting the
public welfare and they include the legislative, judicial, public and political. Municipal powers on the one hand
are exercised for the special benefit and advantage of the community and include those which are ministerial,
private and corporate.
 The rule of law is a general one, that the superior or employer must answer civilly for the negligence or want
of skill of its agent or servant in the course or line of his employment, by which another, who is free from
contributory fault, is injured. Municipal corporations under the conditions herein stated, fall within the
operation of this rule of law, and are liable accordingly, to civil actions for damages when the requisite
elements of liability coexist.
 The New Civil Code divides such properties into property for public use and patrimonial properties, and further
enumerates the properties for public use as provincial roads, city streets, municipal streets, the squares,
fountains, public waters, promenades, and public works for public service paid for by said provisions, cities or
municipalities, all other property is patrimonial without prejudice to the provisions of special laws.
 In this case, the North Cemetery is a patrimonial property of the City of Manila. The administration and
government of the cemetery are under the City Health Officer. With the acts of dominion, there is no doubt
that the North Cemetery is within the class of property which the City of Manila owns in its proprietary or
private character. Furthermore, there is no dispute that the burial lot was leased in favor of the private
respondents. Hence, obligations arising from contracts have the force of law between the contracting parties.
 Thus, a lease contract executed by the lessor and lessee remains as the law between them. Therefore, a breach
of contractual provision entitles the other party to damages even if no penalty for such breach is prescribed in
the contract.
 Under the doctrine of respondeat superior, City of Manila is liable for the tortious act committed by its agents
who failed to verify and check the duration of the contract of lease. The contention of the petitioner-city that
the lease is covered by Administrative Order No. 5 of the City of Manila for five years only beginning from June
6, 1971 is not meritorious for the said administrative order covers new leases. When subject lot was certified
on January 25, 1978 as ready for exhumation, the lease contract for fifty years was still in full force and effect.

Case 7 – TRADERS ROYAL BANK EMPLOYEES UNION v NLRC & ATTY. CRUZ
 There are two commonly accepted concepts of attorney's fees, the so-called ordinary and extraordinary. In its
ordinary concept, an attorney's fee is the reasonable compensation paid to a lawyer by his client for the legal
services he has rendered to the latter. The basis of this compensation is the fact of his employment by and his
agreement with the client. In its extraordinary concept, an attorney's fee is an indemnity for damages ordered
by the court to be paid by the losing party in a litigation. It is the first type of attorney's fees which private
respondent demanded before the labor arbiter.
 The petitioner claims that the NLRC has jurisdiction over claims for attorney's fees only before its judgment is
reviewed and ruled upon by the Supreme Court, and that the former may no longer entertain claims for
attorney's fees. Attorney's fees cannot be determined until after the main litigation has been decided and the
subject of the recovery is at the disposition of the court. The issue over attorney's fees only arises when
something has been recovered from which the fee is to be paid. While a claim for attorney's fees may be filed
before the judgment is rendered, the determination as to the propriety of the fees or as to the amount
thereof will have to be held in abeyance until the main case from which the lawyer's claim for attorney's fees
may arise has become final. Otherwise, the determination to be made by the courts will be premature.
 Petitioner union insists that it is not guilty of unjust enrichment because all attorney's fees due to private
respondent were covered by the retainer fee of P3,000.00 which it has been regularly paying to private
respondent under their retainer agreement. The P3,000.00 which petitioner pays monthly to private
respondent does not cover the services the latter actually rendered before the labor arbiter and the NLRC in
behalf of the former. The monthly fee is intended merely as a consideration for the law firm's commitment to
render the services.
 There are two kinds of retainer fee. These are a general retainer, or a retaining fee, and a special retainer. A
general retainer, or retaining fee, is the fee paid to a lawyer to secure his future services as general counsel
for any ordinary legal problem that may arise in the routinary business of the client and referred to him for
legal action. The fees are paid whether or not there are cases referred to the lawyer. The reason for the
remuneration is that the lawyer is deprived of the opportunity of rendering services for a fee to the opposing
party or other parties. In fine, it is a compensation for lost opportunities. A special retainer is a fee for a
specific case handled or special service rendered by the lawyer for a client. A client may have several cases
demanding special or individual attention. If for every case there is a separate and independent contract for
attorney's fees, each fee is considered a special retainer. The P3,000 monthly fee in this case is a general
retainer.
 The court cannot favorably consider the suggestion of petitioner that private respondent had already waived
his right to charge additional fees because of their failure to come to an agreement as to its payment. The fact
that petitioner and private respondent failed to reach a meeting of the minds with regard to the payment of
professional fees for special services will not absolve the former of civil liability for the corresponding
remuneration therefore in favor of the latter.
 Obligations do not emanate only from contracts. One of the sources of extra-contractual obligations found in
our Civil Code is the quasi-contract. As embodied in our law, certain lawful, voluntary and unilateral acts give
rise to the juridical relation of quasi-contract to the end that no one shall be unjustly enriched or benefited at
the expense of another. A quasi-contract between the parties in the case at bar arose from private
respondent's lawful, voluntary and unilateral prosecution of petitioner's cause without awaiting the latter's
consent and approval. Petitioner cannot deny that it did benefit from private respondent's efforts as the law
firm was able to obtain an award of holiday pay differential in favor of the union. Private respondent's actual
rendition of legal services is not compensable merely by said amount.
  The measure of compensation for private respondent' s services as against his client should properly be
addressed by the rule of quantum meruit long adopted in this jurisdiction. Quantum meruit, meaning "as much
as he deserves," is used as the basis for determining the lawyer's professional fees in the absence of a contract,
but recoverable by him from his client.
 This Court has laid down guidelines in ascertaining the real worth of a lawyer's services. These factors are now
codified in Rule 20.01, Canon 20 of the Code of Professional Responsibility and should be considered in fixing a
reasonable compensation for services rendered by a lawyer on the basis of quantum meruit. In this case, the
falw is, instead of adopting the said guidelines, the labor arbiter forthwith but erroneously set the amount of
attorney's fees on the basis of Article 111 of the Labor Code that states that attorney's fees in any judicial or
administrative proceedings for the recovery of wages shall not exceed 10% of the amount awarded. It may not
be used therefore, as the lone standard in fixing the exact amount payable to the lawyer by his client for the
legal services he rendered. Also, while it limits the maximum allowable amount of attorney's fees, it does not
direct the instantaneous and automatic award of attorney's fees in such maximum limit.

Case 8 – COCA-COLA v GERONIMO

 The petitioner insists that the primary legal basis for private respondent's cause of action is not Article 2176 of
the Civil Code on quasi-delict for the complaint does not ascribe any tortious or wrongful conduct on its part
but Articles 1561 and 1562 thereof on breach of a seller's implied warranties under the law on sales . It
contends that the existence of a contractual relation between the parties (arising from the contract of sale)
bars the application of the law on quasi-delicts and that since private respondent's cause of action arose from
the breach of implied warranties, the complaint should have been filed within six months from delivery of the
soft drinks pursuant to Article 1571 of the Civil Code.
 The public respondent's conclusion that the cause of action is founded on quasi-delict. Therefore, pursuant to
Article 1146 of the Civil Code, it prescribes in four years is supported by the allegations in the complaint, which
makes reference to the reckless and negligent manufacture of adulterated food items intended to be sold for
public consumption.
 The vendee's remedies against a vendor with respect to the warranties against hidden defects of or
encumbrances upon the thing sold are not limited to those prescribed in Article 1567 of the Civil Code which
provides that “in the case of Articles 1561 to 1566, the vendee may elect between withdrawing from the
contract and demanding a proportionate reduction of the price, with damages in either case. The vendee may
also ask for the annulment of the contract upon proof of error or fraud, in which case the ordinary rule on
obligations shall be applicable. Under the law on obligations, responsibility arising from fraud is demandable
in all obligations and any waiver of an action for future fraud is void. Responsibility arising from negligence is
also demandable in any obligation, but such liability may be regulated by the courts, according to the
circumstances. Those guilty of fraud, negligence, or delay in the performance of their obligations and those who
in any manner contravene the tenor thereof are liable for damages.
 The vendor could likewise be liable for quasi-delict under Article 2176 of the Civil Code, and an action based
thereon may be brought by the vendee. While it may be true that the pre-existing contract between the parties
may, as a general rule, bar the applicability of the law on quasi-delict, the liability may itself be deemed to
arise from quasi-delict, i.e., the act which breaks the contract may also be a quasi-delict.

Case 9 – PESTANO & METRO CEBU AUTOBUS v SUMAYANG

 Under Articles 2180 and 2176 of the Civil Code, owners and managers are responsible for damages caused by
their employees. When an injury is caused by the negligence of a servant or an employee, the master or
employer is presumed to be negligent either in the selection or in the supervision of that employee. This
presumption may be overcome only by satisfactorily showing that the employer exercised the care and the
diligence of a good father of a family in the selection and the supervision of its employee. The fact that
Pestaño was able to use a bus with a faulty speedometer shows that Metro Cebu was remiss in the supervision
of its employees and in the proper care of its vehicles. It had thus failed to conduct its business with the
diligence required by law.
 The award for loss of earning capacity is based on two factors: (1) the number of years on which the
computation of damages is based and (2) the rate at which the loss sustained by the heirs is fixed . The first
factor refers to the life expectancy, which takes into consideration the nature of the victim's work, lifestyle, age
and state of health prior to the accident. The second refers to the victim's earning capacity minus the necessary
 living expenses. The Court has consistently computed the loss of earning capacity based on the life expectancy
of the deceased, and not on that of the heir.

Case 10 – YAMBAO v ZUNIGA

 The "diligence of a good father" means diligence in the selection and supervision of employees. Thus, when
an employee, while performing his duties, causes damage to persons or property due to his own negligence,
there arises the juris tantum presumption that the employer is negligent, either in the selection of the
employee or in the supervision over him after the selection. For the employer to avoid the solidary liability for a
tort committed by his employee, an employer must rebut the presumption by presenting adequate and
convincing proof that in the selection and supervision of his employee, he or she exercises the care and
diligence of a good father of a family. In the instant case, we find that petitioner has failed to rebut the
presumption of negligence on her part.
 Petitioner's claim that she exercised due diligence in the selection and supervision of her driver, Venturina,
deserves but scant consideration. Her allegation that before she hired Venturina, she required him to submit
his driver's license and clearances is worthless, in view of her failure to offer in evidence certified true copies of
said license and clearances. Bare allegations, unsubstantiated by evidence, are not equivalent to proof under
the rules of evidence. Moreover, she declared that Venturina applied with her sometime in January 1992 and
she then required him to submit his license and clearances. However, the record likewise shows that she did
admit that Venturina submitted the said requirements only on May 6, 1992, or on the very day of the fatal
accident itself. In other words, petitioner's own admissions clearly and categorically show that she did not
exercise due diligence in the selection of her bus driver.

Case 11 – VIRON TRANSPORTATION v DE LOS SANTOS, NATIVIDAD & SAMIDAN

 Petitioner endeavors to review the factual findings of the trial court as sustained by the Court of Appeals
finding the driver of the Viron passenger bus at fault as the collision resulted from the latter's failed attempt to
overtake the cargo truck. We are unable to sustain petitioner's contention. The rule is settled that the findings
of the trial court especially when affirmed by the Court of Appeals, are conclusive on this Court when
supported by the evidence on record. The Supreme Court will not assess and evaluate all over again the
evidence, testimonial and documentary adduced by the parties to an appeal particularly where, such as here,
the findings of both the trial court and the appellate court on the maker coincide.
 As employers of the bus driver, the petitioner is, under Article 2180 of the Civil Code, directly and primary liable
for the resulting damages. The presumption that they are negligent flows from the negligence of their
employee. That presumption, however, is only juris tantum, not juris et de jure. Their only possible defense is
that they exercised all the diligence of a good father of a family to prevent the damage. The diligence of a good
father referred to means the diligence in the selection and supervision of employees.
 Appellant's claim that the court a quo erred in not allowing it to present rebuttal evidence, thus depriving it of
its day in court is without merit. A review of the records would show that appellant was given ample
opportunity to present its rebuttal evidence but failed to do so. It was appellant itself which sought the
postponements and cancellations of the hearings, after its motion for the presentation of rebuttal evidence had
been granted.
 Actual damages, to be recoverable, must not only be capable of proof, but must actually be proved with a
reasonable degree of certainty. Courts cannot simply rely on speculation, conjecture or guesswork in
determining the fact and number of damages. 16 To justify an award of actual damages, there must be
competent proof of the actual amount of loss, credence can be given only to claims which are duly supported
by receipts.

Case 12 – DIGNOS & LUMUNGSOD v CA & JABIL

 Petitioners reiterated their contention that the Deed of Sale is a mere contract to sell and not an absolute sale;
that the same is subject to two positive suspensive conditions, namely: the payment of the balance of
P4,000.00 and the immediate assumption of the mortgage of P12,000.00. It is further contended that title or
 ownership over the property was expressly reserved in the vendor until the suspensive condition of full and
payment of the balance of the purchase price shall have been met. So that there is no actual sale until full
payment is made. Such contention is untenable. It has been held that a deed of sale is absolute in nature
although denominated as a "Deed of Conditional Sale" where nowhere in the contract in question is a
proviso or stipulation to the effect that title to the property sold is reserved in the vendor until full payment
of the purchase price, nor is there a stipulation giving the vendor the right to unilaterally rescind the contract
the moment the vendee fails to pay within a fixed period.
 In this case, all the elements of a valid contract of sale under Article 1458 of the Civil Code, are present, such as:
(1) consent or meeting of the minds; (2) determinate subject matter; and (3) price certain in money or its
equivalent. In addition, Article 1477 of the same Code provides that the ownership of the thing sold shall be
transferred to the vendee upon actual or constructive delivery thereof. While it may be conceded that there
was no constructive delivery of the land sold in the case at bar, as subject Deed of Sale is a private instrument,
it is beyond question that there was actual delivery thereof.
 Petitioners claim that when they sold the land to the Cabigas spouses, the contract of sale was already
rescinded. It is undisputed that petitioners never notified private respondents Jabil by notarial act that they
were rescinding the contract, and neither did they file a suit in court to rescind the sale. Under Article 1358 of
the Civil Code, it is required that acts and contracts which have for their object the extinguishment of real
rights over immovable property must appear in a public document.
 Petitioners laid considerable emphasis on the fact that private respondent Jabil had no money on the stipulated
date of payment. It has been ruled, however, that where time is not of the essence of the agreement, a slight
delay on the part of one party in the performance of his obligation is not a sufficient ground for the rescission
of the agreement.