Download Oblicon Case Digests - Topic - Kinds of Non-Performance PDF

TitleOblicon Case Digests - Topic - Kinds of Non-Performance
TagsDamages Fraud Partnership Prejudice (Legal Term) Franchising
File Size63.7 KB
Total Pages5
Document Text Contents
Page 4

Kenstar’s contention that the European Tour Manager does not refer to a natural
person but a juridical personality does not hold because a corporate entity could not
possibly accompany the tour group. Lastly Kenstar committed grave
misrepresentation when it assured in its tour package that the hotels provided would
provide complete amenities and would be conveniently located along the way for the
daily itineraries. The testimonies by petitioner and private respondent show that the
hotels were unsanitary and sometimes did not even provide towels and soap. Further
testimonies claim that the hotels were also located in locations far from the city
making it difficult to go to. The fact that Kenstar could only book them in such hotels
because of budget constraints is not the fault of the tour group. Kenstar should not
have promised such accommodations if they couldn’t afford it. Kenstar should have
increased the price to ensure accommodations.

Petitioners therefore should be awarded moral damages because of breach of
contract because the obligor acted fraudulently or in bad faith.

International Corporate Bank v Gueco, GR No 141968, 12 February 2001

Facts: Respondent Gueco spouses obtained a loan from petitioner International
Corporate Bank (now Union Bank of Philippines) to purchase a car – Nissan Sentra
1989 model. In consideration, spouses executed promissory note which were payable
in monthly installment & chattel mortgage over the car.

The spouses defaulted payment. In the ensuing events Dr. Gueco had a meeting with
petitioner to negotiate for the payment of the unpaid installment of P184,000
(balance of the loan). The load was eventually reduced to P150,000. However, the car
was detained by the bank pending its payment.

When Dr. Gueco delivered the manager’s check amounting to P150,000, the car was
not released because of his refusal to sign the Joint Motion to Dismiss.The bank
insisted that the Joint Motion to Dismiss is a standard operating procedure to effect a
compromise & to preclude future filing of claims or suits for damages.

The Gueco spouses, on the other hand, maintain that no such requirement was
agreed upon during the negotiation for the payment of the loan. As a result, Gueco
filed an action against the bank for fraud, failing to inform them regarding Joint
Motion to Dismiss requiment during the meeting & for failing to release the car
despite payment of the P150,000 obligation.

Issues: WoN the bank was guilty of fraud?

Held: No. Fraud has been defined as the deliberate intention to cause damage or
prejudice. It is the voluntary execution of a wrongful act, or a willful omission,
knowing and intending the effects which naturally and necessarily arise from such act
or omission. the fraud referred to in Article 1170 of the Civil Code is the deliberate
and intentional evasion of the normal fulfillment of obligation.

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