Lawyerly

You're currently signed in as:
User

TOLOMEO LIGUTAN v. CA

This case has been cited 9 times or more.

	GR No. 176425 2013-06-05	HEIRS OF MANUEL UY EK LIONG v. MAURICIA MEER CASTILLO PEREZ, J.
Our perusal of the Kasunduan also shows that it contains a penal clause[64] which provides that a party who violates any of its provisions shall be liable to pay the aggrieved party a penalty fixed at P50,000.00, together with the attorney's fees and litigation expenses incurred by the latter should judicial resolution of the matter becomes necessary.[65] An accessory undertaking to assume greater liability on the part of the obligor in case of breach of an obligation, the foregoing stipulation is a penal clause which serves to strengthen the coercive force of the obligation and provides for liquidated damages for such breach.[66] "The obligor would then be bound to pay the stipulated indemnity without the necessity of proof of the existence and the measure of damages caused by the breach."[67] Articles 1226 and 1227 of the Civil Code state: Art. 1226. In obligations with a penal clause, the penalty shall substitute the indemnity for damages and the payment of interests in case of noncompliance, if there is no stipulation to the contrary. Nevertheless, damages shall be paid if the obligor refuses to pay the penalty or is guilty of fraud in the fulfillment of the obligation.
	GR No. 176664 2008-07-21	BANK OF PHILIPPINE ISLANDS v. SPS. REYNALDO NACHURA, J.
Nonetheless, the Court cannot ignore what the respondents have consistently raised -- that they were not notified of the non-payment of the checks. Reasonable banking practice and prudence dictates that, when a check given to a creditor bank in payment of an obligation is dishonored, the bank should immediately return it to the debtor and demand its replacement or payment lest it causes any prejudice to the drawer. In light of this and the fact that the obligation has been partially paid, we deem it just and equitable to reduce the 3% per month penalty charge as stipulated in the Promissory Note to 12% per annum.[32] Although a court is not at liberty to ignore the freedom of the parties to agree on such terms and conditions as they see fit, as long as they contravene no law, morals, good customs, public order or public policy, a stipulated penalty, nevertheless, may be equitably reduced by the courts if it is iniquitous or unconscionable, or if the principal obligation has been partly or irregularly complied with.[33]
	GR No. 172384 2007-09-12	ERMINDA F. FLORENTINO v. SUPERVALUE CHICO-NAZARIO, J.
A penal clause is an accessory undertaking to assume greater liability in case of breach. It is attached to an obligation in order to insure performance and has a double function: (1) to provide for liquidated damages, and (2) to strengthen the coercive force of the obligation by the threat of greater responsibility in the event of breach.[29] The obligor would then be bound to pay the stipulated indemnity without the necessity of proof of the existence and the measure of damages caused by the breach.[30] Article 1226 of the Civil Code states:Art. 1226. In obligations with a penal clause, the penalty shall substitute the indemnity for damages and the payment of interests in case of noncompliance, if there is no stipulation to the contrary. Nevertheless, damages shall be paid if the obligor refuses to pay the penalty or is guilty of fraud in the fulfillment of the obligation.
	GR NO. 153874 2007-03-01	TITAN CONSTRUCTION CORPORATION v. UNI-FIELD ENTERPRISES CARPIO, J.
On the other hand, the law also allows parties to a contract to stipulate on liquidated damages to be paid in case of breach.[20] A stipulation on liquidated damages is a penalty clause where the obligor assumes a greater liability in case of breach of an obligation.[21] The obligor is bound to pay the stipulated amount without need for proof on the existence and on the measure of damages caused by the breach.[22]
	GR NO. 138980 2005-09-20	FILINVEST LAND v. CA
In Ligutan v. Court of Appeals,[22] we pointed out that the question of whether a penalty is reasonable or iniquitous can be partly subjective and partly objective as its "resolution would depend on such factors as, but not necessarily confined to, the type, extent and purpose of the penalty, the nature of the obligation, the mode of breach and its consequences, the supervening realities, the standing and relationship of the parties, and the like, the application of which, by and large, is addressed to the sound discretion of the court."[23]
	GR NO. 157480 2005-05-06	PRYCE CORPORATION v. PHILIPPINE AMUSEMENT PANGANIBAN, J.
However, it appears that Section XX (c) was intended to be a penalty clause. That fact is manifest from a reading of the mandatory provision under subparagraph (a) in conjunction with subparagraph (c) of the Contract. A penal clause is "an accessory obligation which the parties attach to a principal obligation for the purpose of insuring the performance thereof by imposing on the debtor a special prestation (generally consisting in the payment of a sum of money) in case the obligation is not fulfilled or is irregularly or inadequately fulfilled."[26]
	GR No. 141434 2003-09-23	ANTONIO LO v. CA CORONA, J.
The question of whether a penalty is reasonable or iniquitous is addressed to the sound discretion of the court and depends on several factors, including, but not limited to, the following: the type, extent and purpose of the penalty, the nature of the obligation, the mode of breach and its consequences, the supervening realities, the standing and relationship of the parties.[6]
	GR No. 130759 2003-06-20	ASIATRUST DEVELOPMENT BANK v. CONCEPTS TRADING CORPORATION CALLEJO, SR., J.
Art. 1229. The judge shall equitably reduce the penalty when the principal obligation has been partly or irregularly complied with by the debtor. Even if there has been no performance, the penalty may also be reduced by the courts if it is iniquitous or unconscionable. Indeed, this Court had equitably reduced the penalty in not a few cases. In the recent case of Ligutan v. Court of Appeals,[22] the Court affirmed the reduction of the penalty charges by the CA upon its finding that the debtors therein had partially complied with their obligation. In Rizal Commercial Banking Corp. v. Court of Appeals,[23] the Court tempered the penalty charges after taking into account the debtor's pitiful situation and its offer to settle the entire obligation with the creditor bank. In Insular Bank of Asia and America v. Spouses Salazar,[24] the Court reduced the penalty charge on a loan of P42,050, considering that the debtor spouses paid a total of P68,676.75 which the creditor bank applied to satisfy the penalty and interest charges.
	GR No. 146942 2003-04-22	CORAZON G. RUIZ v. CA PUNO, J.
The 1% surcharge on the principal loan for every month of default is valid. This surcharge or penalty stipulated in a loan agreement in case of default partakes of the nature of liquidated damages under Art. 2227 of the New Civil Code, and is separate and distinct from interest payment.[59] Also referred to as a penalty clause, it is expressly recognized by law. It is an accessory undertaking to assume greater liability on the part of an obligor in case of breach of an obligation.[60] The obligor would then be bound to pay the stipulated amount of indemnity without the necessity of proof on the existence and on the measure of damages caused by the breach.[61] Although the courts may not at liberty ignore the freedom of the parties to agree on such terms and conditions as they see fit that contravene neither law nor morals, good customs, public order or public policy, a stipulated penalty, nevertheless, may be equitably reduced if it is iniquitous or unconscionable.[62] In the instant case, the 10% surcharge per month stipulated in the promissory notes dated May 23, 1995 and December 1, 1995 was properly reduced by the appellate court.