CASE # 5

G.R. No. 163512 February 28, 2007

DAISY B. TIU, Petitioner

vs.
PLATINUM PLANS PHIL., INC., Respondent.

Topic: Autonomy of contracts

Quisimbing, J.

Summary/Doctrine:

Petitioner was a former AVP of the respondent pre-need company who worked for another pre-
need company. Respondent sued for damages based on a Non-involvement clause in petitioners
employment contract. Is the non-involvement clause valid?

Held: YES, Article 1306 of the Civil Code provides that parties to a contract may establish such
stipulations, clauses, terms and conditions as they may deem convenient, provided they are not
contrary to law, morals, good customs, public order, or public policy. (See ratio for the
circumstances on why clause is valid)

Facts:

Respondent Platinum Plans Philippines, Inc. is a domestic corporation engaged in the pre-need
industry. From 1987 to 1989, petitioner Daisy B. Tiu was its Division Marketing Director.

On January 1, 1993, respondent re-hired petitioner as Senior Assistant Vice-President and

Territorial Operations Head in charge of its Hongkong and Asean operations. The parties
executed a contract of employment valid for five years

On September 16, 1995, petitioner stopped reporting for work. In November 1995, she became
the Vice-President for Sales of Professional Pension Plans, Inc., a corporation engaged also in
the pre-need industry.

She was sued for damages for violating her contract with respondent which prohibited her in a
business of the same nature within two (2) years separation, whether voluntary or involuntary.
The RTC and the CA held her liable.

Before the SC, the petitioner contended that the non-involvement clause is offensive to public
policy since the restraint imposed is much greater than what is necessary to afford respondent a
fair and reasonable protection. She added that since the products sold in the pre-need industry
are more or less the same, the transfer to a rival company is acceptable. She likewise argued that
a strict application of the non-involvement clause would deprive her of the right to engage in the
only work she knows.

Respondent countered that the validity of a non-involvement clause has been sustained by the
Supreme Court in a long line of cases. It contended that the inclusion of the two-year non-
involvement clause in the contract of employment was reasonable and needed since her job gave
her access to the companys confidential marketing strategies. It added that the non-involvement
clause merely enjoined her from engaging in pre-need business akin to respondents within two
years from her separation from respondent. She had not been prohibited from marketing other
service plans.
Issue/s: Is the non-involvement clause valid? YES

Held/Ratio:

In Del Castillo v. Richmond, 45 Phil. 679 (1974), a similar stipulation was upheld as legal,
reasonable, and not contrary to public policy. In the said case, the employee was restricted from
opening, owning or having any connection with any other drugstore within a radius of four miles
from the employers place of business during the time the employer was operating his drugstore.
A contract in restraint of trade is valid provided there is a limitation upon either time or place and
the restraint upon one party is not greater than the protection the other party requires.

Finally, in Consulta v. Court of Appeals, G.R. No. 145443, March 18, 2005, 453 SCRA 732, a non-
involvement clause was held in accordance with Article 1306 of the Civil Code. While the
complainant in that case was an independent agent and not an employee, she was prohibited for
one year from engaging directly or indirectly in activities of other companies that compete with the
business of her principal. The restriction did not prohibit the agent from engaging in any other
business, or from being connected with any other company, for as long as the business or
company did not compete with the principals business. Further, the prohibition applied only for
one year after the termination of the agents contract and was therefore a reasonable restriction
designed to prevent acts prejudicial to the employer.

Conformably with the aforementioned pronouncements, a non-involvement clause is not

necessarily void for being in restraint of trade as long as there are reasonable limitations as to
time, trade, and place.

In this case, the non-involvement clause has a time limit: two years from the time petitioners
employment with respondent ends. It is also limited as to trade, since it only prohibits petitioner
from engaging in any pre-need business akin to respondents.

In this case what makes the non-involvement clause valid is that, she had been privy to
confidential and highly sensitive marketing strategies of respondents business. To allow her to
engage in a rival business soon after she leaves would make respondents trade secrets
vulnerable especially in a highly competitive marketing environment. In sum, the non-involvement
clause is not contrary to public welfare and not greater than is necessary to afford a fair and
reasonable protection to respondent. (Ollendorff v. Abrahamsom, 38 Phil. 585 (1918)).

In any event, Article 1306 of the Civil Code provides that parties to a contract may establish such
stipulations, clauses, terms and conditions as they may deem convenient, provided they are not
contrary to law, morals, good customs, public order, or public policy.

Article 1159 of the same Code also provides that obligations arising from contracts have the force
of law between the contracting parties and should be complied with in good faith. Courts cannot
stipulate for the parties nor amend their agreement where the same does not contravene law,
morals, good customs, public order or public policy, for to do so would be to alter the real intent of
the parties, and would run contrary to the function of the courts to give force and effect thereto.
(Phil. Communications Satellite Corp. v. Telecom, Inc., G.R. Nos. 147324 and 147334, May 25,
2004, 429 SCRA 153).
CASE # 11

G.R. No. 184041 October 13, 2010

ANICETO G. SALUDO, JR., Petitioner,
vs.
SECURITY BANK CORPORATION, Respondent.

Topic: Relativity of contracts, Privity of contracts

PEREZ, J.

Summary/doctrine:

Booklight enter into a credit agrrement with SBC with petitioner as surety. Under the agreement
booklight obtained 2 credit facilities. Booklight was able to pay the first but not the second. SBC
sued Booklight and petitioner. Petitioner contends that he should not be held solidarily liable since
the continuing surety agreement only covers the first facility.

Facts:

On May 30, 1996, Booklight inc. was extended an omnibus line credit facility by Security Bank
(SBC) in the amount of 10,000,000.00. Said loan was covered by a Credit Agreement and
Continuing Suretyship with the herein petitioner as surety, both documents dated August 1, 1996
to secure full payment and performance of the obligations arising from the credit accommodation.

Booklight drew several availments of the approved credit facility from 1996 to 1997 and faithfully
complied with the terms of the loan. On October 30, 1997, SBC approved the renewal of the
credit facility of Booklight in the amount of 10,000,000.00 under the prevailing security lending
rate. From August 3-14, 1998 Booklight executed 9 promissory notes in favor of SBC in the
aggregate amount of 9,652,725.00. As of May 15, 2000 the obligation of Booklight stood at
10,487,875.41, inclusive of interest past due and penalty.

On June 16, 2000, SBC filed against Booklight and herein petitioner an action for collection of
sum of money with the RTC. On March 7, 2005 Booklight was declared in default.

RTC ruled in favor of SBC, CA affirmed.

Petitioner contends that he should not be held solidarily liable with booklight as to the second
credit facility since the continuing suretyship only pertains to the first credit facility which has
already expired and paid for by booklight.

Issue/s: Whether petitioner should be held solidarily liable for the second credit facility extended
to Booklight? - YES

Held/Ratio:

It is the first credit facility that expired and not the Credit Agreement. There was a second loan
pursuant to the same credit agreement. The terms and conditions under the Credit Agreement
continue to apply and the Continuing Suretyship continues to guarantee the Credit Agreement.

The essence of a continuing surety has been highlighted in the case of Totanes v. China Banking
Corporation19 in this wise:
Comprehensive or continuing surety agreements are, in fact, quite commonplace in present day
financial and commercial practice. A bank or financing company which anticipates entering into a
series of credit transactions with a particular company, normally requires the projected principal
debtor to execute a continuing surety agreement along with its sureties. By executing such an
agreement, the principal places itself in a position to enter into the projected series of transactions
with its creditor; with such suretyship agreement, there would be no need to execute a separate
surety contract or bond for each financing or credit accommodation extended to the principal
debtor.201awphil

In Gateway Electronics Corporation v. Asianbank Corporation, 21 the Court emphasized that "[b]y
its nature, a continuing suretyship covers current and future loans, provided that, with respect to
future loan transactions, they are x x x within the description or contemplation of the contract of
guaranty."

Petitioner argues that the approval of the second credit facility necessitates his consent
considering the onerous and solidary liability of a surety. This is contrary to the express waiver of
his consent to such renewal, contained in paragraph 12 of the Continuing Suretyship, which
provides in part:

12. Waivers by the Surety. The Surety hereby waives: x x x (v) notice or consent to any
modification, amendment, renewal, extension or grace period granted by the Bank to the Debtor
with respect to the Credit Instruments.22

Respondent, as last resort, harps on the novation of the first credit facility to exculpate itself from
liability from the second credit facility.

At the outset, it must be pointed out that the Credit Agreement is actually the principal contract
and it covers "all credit facilities now or hereafter extended by [SBC] to [Booklight];" 23 and that the
suretyship agreement was executed precisely to guarantee these obligations, i.e., the credit
facilities arising from the credit agreement. The principal contract is the credit agreement covered
by the Continuing Suretyship.

The two loan facilities availed by Booklight under the credit agreement are the Omnibus Line
amounting to P10,000,000.00 granted to Booklight in 1996 and the other one is the Loan Line of
the same amount in 1997. Petitioner however seeks to muddle the issue by insisting that these
two availments were two separate principal contracts, conveniently ignoring the fact that it is the
credit agreement which constitutes the principal contract signed by Booklight in order to avail of
SBCs credit facilities. The two credit facilities are but loans made available to Booklight pursuant
to the credit agreement.

On these facts the novation argument advanced by petitioner must fail.

There is no novation to speak of. It is the first credit facility that expired and not the Credit
Agreement. There was a second loan pursuant to the same credit agreement. The terms and
conditions under the Credit Agreement continue to apply and the Continuing Suretyship continues
to guarantee the Credit Agreement.

The lameness of petitioners stand is pointed up by his attempt to escape from liability by labelling
the Continuing Suretyship as a contract of adhesion.

A contract of adhesion is defined as one in which one of the parties imposes a ready-made form
of contract, which the other party may accept or reject, but which the latter cannot modify. One
party prepares the stipulation in the contract, while the other party merely affixes his signature or
his adhesion thereto, giving no room for negotiation and depriving the latter of the opportunity to
bargain on equal footing.24

A contract of adhesion presupposes that the party adhering to the contract is a weaker party. That
cannot be said of petitioner. He is a lawyer. He is deemed knowledgeable of the legal implications
of the contract that he is signing.

It must be borne in mind, however, that contracts of adhesion are not invalid per se. Contracts of
adhesion, where one party imposes a ready-made form of contract on the other, are not entirely
prohibited. The one who adheres to the contract is, in reality, free to reject it entirely; if he
adheres, he gives his consent.25

Petition denied.
CASE 15

G.R. No. L-47544 January 28, 1980

PEPITO VELASCO, AMABLE LUMANLAN, RAMON GALANG, FELIPE LUMBANG and

APOLONIO DE LOS SANTOS, petitioners,
vs.
COURT OF APPEALS and GOVERNMENT SERVICE INSURANCE SYSTEM, respondents.

Topic: Relativity of contracts, Privity of contracts

BARREDO, J.

Summary/Doctrine:

Petitioners constructed houses for Laigo, a land developer, on a land mortgaged and eventually
foreclosed by GSIS. Laigo failed to pay the petitioners. Petitioners sued GSIS to pay for the
improvements they introduced. GSIS contends that they cannot be held liable due to lack of
privity of contract since the contracts involved were between Laigo and the Petitioners. GSIS is
liable. Although there is no privity of contract, another civil code provision provides for a basis of
their liability.

Article 1311 of the Civil Code which GSIS invokes is not applicable where the situation
contemplated in Article 1729 obtains. The intention of the latter provision is to protect the laborers
and the materialmen from being taken advantage of by unscrupulous contractors and from
possible connivance between owners and contractors. Thus, a constructive vinculum or
contractual privity is created by this provision, by way of exception to the principle underlying
Article 1311 between the owner, on the one hand, and those who furnish labor and/or materials,
on the other. As a matter of fact, insofar as the laborers are concerned, by a special law, Act No.
3959, they are given added protection by requiring contractors to file bonds guaranteeing
payment to them. And under Article 2242 of the Civil Code, paragraphs (3) and (4), claims of
laborers and materialmen, respectively, enjoy preference among the creditors of the owner in
regard to specific immovable property.

Facts:

Sometime on November 10, 1965, Alta Farms secured from the GSIS a Three Million Two
Hundred Fifty Five Thousand Pesos (P3,255,000.00) loan and an additional loan of Five Million
Sixty-Two Thousand Pesos (P5,062,000.00) on October 5, 1967, to finance a piggery project.
These loans were secured by two mortgages

Alta Farms defaulted in the payment of its amortizations. it is presumably because of this that Alta
Farms executed a Deed of Sale With Assumption of Mortgage with Asian Engineering
Corporation on July 10, 1969 (Exh. "C"), but without the previous consent or approval of the GSIS
and in direct violation of the provisions of the mortgage contracts.

Even without the approval of the Deed of Sale With Assumption of Mortgage by the GSIS, Asian
Engineering Corporation executed an Exclusive Sales Agency, Management and Administration
Contract in favor of Laigo Realty Corporation, with the intention of converting the piggery farm
into a subdivision (Exh. "D"). And on October 20, 1969, Asian Engineering executed another
contract with Laigo, whereby Laigo was to undertake the development of the property into a
subdivision (Exh. "E"). Conformably with the two contracts (Exh "D" and "E"), Laigo started the
development of the lot into a subdivision.
The petitioners in this case were contracted(separately so madaming contracts involved) by Laigo
to construct houses for the subdivision. Laigo failed to pay the petitioners.

The Deed of Sale With Assumption of Mortgage between Alta Farms and Asian Engineering, for
one reason or another, was not approved by the GSIS. And when Alta Farms failed to liquidate its
accounts, GSIS foreclosed the properties including all improvements.

Petitioners sued GSIS for the payment of the improvements introduced by them.

GSIS contends that they should not be held liable because there was no privity of contract
between GSIS and the petitioners. The Contracts were between Laigo and petitioners

Issue/s: Should GSIS be held liable despite it not being a party to the contracts involved? - YES

Held/Ratio:

Upon the foregoing factual premises, the legal issue that arises is whether or not GSIS is liable to
the petitioners for the cost of the materials and labor furnished by them in construction of the 63
houses now owned by the GSIS and for the construction of which no payment has been made on
the balance due petitioners. Our considered view is and We so hold that even in equity alone,
GSIS should pay the petitioners. After all, it admits it has not collected from the ones who appear
to be the buyers thereof, albeit it must be collecting the installments on the lots. All it has to do
then is to pass on to them what it has to pay petitioners. In law, GSIS is, under the peculiar
circumstances of this case, the owner of said houses. Pursuant to Article 1729 of the Civil Code:

Those who put their labor upon or furnish materials for a piece of work
undertaken by the contractor have an action against the owner up to the amount
owing from the latter to the contractor at the time the claim is made. However, the
following shall not prejudice the laborers, employees and furnishers of materials:

1) Payments made by the owner to the contractor before they are due;

2) Renunciation by the contractor of any amount due him from the owner.

This article is subject to the provisions of special laws. (1597a)

Laigo admittedly has not paid petitioners. The "bouncing" checks issued by it in their favor is
mentioned by GSIS itself in its statement of the facts. We hold that upon this premise it is a fair
construction of the Deed of Quitclaim aforementioned, that GSIS can be held liable to petitioners,
without prejudice to its securing corresponding indemnity from Laigo. It is obvious from the terms
of said deed that GSIS contemplated the possibility of its being liable for Laigo's account,
otherwise, there was no need for the reservation. This is one such liability. In this connection
while, indeed, Article 1729 refers to the laborers and materialmen themselves, under the peculiar
circumstances of this case, it is but fair and just that petitioners be deemed as suing for the
reimbursement of what they have already paid the laborers and materialmen, as otherwise they
(petitioners) would be unduly prejudiced while either Laigo, GSIS or the occupants of the houses
would enrich themselves at their expense. It is a bad law that would allow such a result.

At this juncture, We need to add only that Article 1311 of the Civil Code which GSIS invokes is not
applicable where the situation contemplated in Article 1729 obtains. The intention of the latter
provision is to protect the laborers and the materialmen from being taken advantage of by
unscrupulous contractors and from possible connivance between owners and contractors. Thus,
a constructive vinculum or contractual privity is created by this provision, by way of exception to
the principle underlying Article 1311 between the owner, on the one hand, and those who furnish
labor and/or materials, on the other. As a matter of fact, insofar as the laborers are concerned, by
a special law, Act No. 3959, they are given added protection by requiring contractors to file bonds
guaranteeing payment to them. And under Article 2242 of the Civil Code, paragraphs (3) and (4),
claims of laborers and materialmen, respectively, enjoy preference among the creditors of the
owner in regard to specific immovable property.
CASE 22

G.R. No. L-9356 February 18, 1915

C. S. GILCHRIST, plaintiff-appellee,
vs.
E. A. CUDDY, ET AL., defendants.
JOSE FERNANDEZ ESPEJO and MARIANO ZALDARRIAGA, appellants.

Topic: Relativity of contracts, Privity of contracts

TRENT, J.

Doctrine:

Di ko na nilagyan ng summary since maikli lang facts.

One who wrongfully interferes in a contract between others, and, for the purpose of gain to
himself induces one of the parties to break it, is liable to the party injured thereby; and his
continued interference may be ground for an injunction where the injuries resulting will be
irreparable

Facts:

Cuddy was the owner of the film Zigomar

April 24: He rented it to C. S. Gilchrist for a week for P125
A few days to the date of delivery, Cuddy sent the money back to Gilchrist
It turns out Cuddy rented the film to Espejo and his partner Zaldarriaga P350 for the week
knowing that it was rented to someone else and that Cuddy accepted it because he was
paying about three times as much as he had contracted with Gilchrist but they didn't know
the identity of the other party
Gilchrist filed for injunction against these parties
Trial Court and CA: granted - there is a contract between Gilchrist and Cuddy
Issue/s: W/N Espejo and his partner Zaldarriaga should be liable for damages though they do
not know the identity of Gilchrist? - YES
Held/Ratio:

Although the defendants did not, at the time their contract was made, know the identity of the
plaintiff as the person holding the prior contract but did know of the existence of a contract in
favor of someone In the case at bar the only motive for the interference with the Gilchrist - Cuddy
contract on the part of the appellants was a desire to make a profit by exhibiting the film in their
theater. There was no malice beyond this desire; but this fact does not relieve them of the legal
liability for interfering with that contract and causing its breach. It is, therefore, clear, under the
above authorities, that they were liable to Gilchrist for the damages caused by their acts, unless
they are relieved from such liability by reason of the fact that they did not know at the time the
identity of the original lessee (Gilchrist) of the film.

Article 1902 of that code provides that a person who, by act or omission, causes damages
to another when there is fault or negligence, shall be obliged to repair the damage do
done. There is nothing in this article which requires as a condition precedent to the
liability of a tort-feasor that he must know the identity of a person to whom he causes
damages. In fact, the chapter wherein this article is found clearly shows that no such
knowledge is required in order that the injured party may recover for the damage suffered.
One who buys something which he knows has been sold to some other person can be restrained
from using that thing to the prejudice of the person having the prior and better right.

Chief Justice Wells:"Everyone has a right to enjoy the fruits and advantages of his own
enterprise, industry, skill and credit. He has no right to be free from malicious and wanton
interference, disturbance or annoyance. If disturbance or loss come as a result of
competition, or the exercise of like rights by others, it is damnum absque injuria, unless
some superior right by contract or otherwise is interfered with."

"One who wrongfully interferes in a contract between others, and, for the purpose of gain
to himself induces one of the parties to break it, is liable to the party injured thereby; and
his continued interference may be ground for an injunction where the injuries resulting
will be irreparable."
CASE 29

G.R. No. 175483, October 14, 2015

VALENTINA S. CLEMENTE, Petitioner, v. THE COURT OF APPEALS, ANNIE SHOTWELL

JALANDOON, ET AL., Respondents.

JARDELEZA,J.

Topic: Elements

Summary/Doctrine:

Adela Shotwell(owner of 3 parcels of land) simulated the sale of such land to petitioner. Petitioner
had the said parcels of land registered under her name. Private respondents discovered the
registration and is now asking the courts for the reconveyance of the lands on the ground of
simulated sale.

In determining the true nature of a contract, the primary test is the intention of the parties. If the
words of a contract appear to contravene the evident intention of the parties, the latter shall
prevail. Such intention is determined not only from the express terms of their agreement, but also
from the contemporaneous and subsequent acts of the parties.

In this case the court broke down the circumstances surrounding the contract before it came to
the conclusion that the sale was simulated. See the ratio part.

Facts:

Adela Shotwell owned three (Lots 32, 34 and 35-B) adjoining parcels of land. Among the
improvements on the Properties was Adela's house (also referred to as the "big house"). During
her lifetime, Adela allowed her children, namely, Annie Shotwell Jalandoon, Carlos G. Shotwell
("Carlos Sr."), Anselmo G. Shotwell and Corazon S. Basset, and her grandchildren, 4 the use and
possession of the Properties and its improvements.

Prior simulation: In the case there was a prior simulation of the sale of the parcels of land(Lot 32
and 34) to Carlos Sr. and Carlos Jr. But the properties were reconveyed to Adela on On April 18,
1989, prior to Adela and petitioner's departure for the United States. This was an undisputed fact
in the case.

On April 25, 1989, Adela executed a deed of absolute sale 11 over Lots 32 and 34(later on it was
discovered that 35-b was also sold for 60,000), and their improvements, in favor of petitioner,
bearing on its face the price of P250,000.00. On the same day, Adela also executed a special
power of attorney12 (SPA) in favor of petitioner. Petitioner's authority under the SPA included the
power to administer, take charge and manage, for Adela's benefit, the Properties and all her other
real and personal properties in the Philippines.

On April 29, 1989, Adela and petitioner left for the United States. 15 When petitioner returned to the
Philippines, she registered the sale over Lots 32 and 34 with the Registry of Deeds under her
name.

On January 14, 1990, Adela died in the United States and was succeeded by her four children.
Soon thereafter, petitioner sought to eject Annie and Carlos Sr., who were then staying on the
Properties. Only then did Annie and Carlos Sr. learn of the transfer of titles to petitioner. Thus, on
July 9, 1990, Annie, Carlos Sr. and Anselmo, represented by Annie, ("private respondents") filed a
complaint for reconveyance of property18 against petitioner

Private respondents sought nullification of the Deeds of Absolute Sale. They alleged that Adela
only wanted to help petitioner travel to the United States, by making it appear that petitioner has
ownership of the Properties. They further alleged that similar to the previous simulated transfers
to Carlos Jr. and Dennis, petitioner also undertook and warranted to execute a deed of
reconveyance in favor of the deceased over the Properties, if and when Adela should demand the
same. They finally alleged that no consideration was given by petitioner to Adela in exchange for
the simulated conveyances.

RTC Private Respondents. CA afiirmed.

Issue: Was there a simulated sale? - YES

Held/Ratio:

Here, there was no valid contract of sale between petitioner and Adela because their consent was
absent. The contract of sale was a mere simulation.

Simulation takes place when the parties do not really want the contract they have executed to
produce the legal effects expressed by its wordings.46 Article 1345 of the Civil Code provides that
the simulation of a contract may either be absolute or relative. The former takes place when the
parties do not intend to be bound at all; the latter, when the parties conceal their true agreement.

In determining the true nature of a contract, the primary test is the intention of the parties. If the
words of a contract appear to contravene the evident intention of the parties, the latter shall
prevail. Such intention is determined not only from the express terms of their agreement, but also
from the contemporaneous and subsequent acts of the parties.

In ruling that the Deeds of Absolute Sale were absolutely simulated, the lower courts considered
the totality of the prior, contemporaneous and subsequent acts of the parties. The following
circumstances led the RTC and the CA to conclude that the Deeds of Absolute Sale are
simulated, and that the transfers were never intended to affect the juridical relation of the
parties:chanRoblesvirtualLawlibrary

a) There was no indication that Adela intended to alienate her properties in favor of petitioner. In
fact, the letter of Adela to Dennis dated April 18, 1989 51 reveals that she has reserved the
ownership of the Properties in favor of Dennis.

b) Adela continued exercising acts of dominion and control over the properties, even after the
execution of the Deeds of Absolute Sale, and though she lived abroad for a time. In Adela's letter
dated August 25, 198952 to a certain Candy, she advised the latter to stay in the big house. Also,
in petitioner's letter to her cousin Dennis dated July 3, 1989, 53 she admitted that Adela continued
to be in charge of the Properties; that she has no "say" when it comes to the Properties; that she
does not intend to claim exclusive ownership of Lot 35-B; and that she is aware that the
ownership and control of the Properties are intended to be consolidated in Dennis.

c) The SPA executed on the same day as the Deeds of Absolute Sale appointing petitioner as
administratrix of Adela's properties, including the Properties, is repugnant to petitioner's claim that
the ownership of the same had been transferred to her.

d) The previous sales of the Properties to Dennis and Carlos, Jr. were simulated. This history,
coupled with Adela's treatment of petitioner, and the surrounding circumstances of the sales,
strongly show that Adela only granted petitioner the same favor she had granted to Dennis and
Carlos Jr.

Moreover, Adela's letter to petitioner's cousin Candy dated August 25, 1989 shows Adela's
retention of dominion over the Properties even after the sales. In the letter, Adela even requested
her granddaughter Candy to stay in the house rent and expense free. 57 Petitioner claims that
Candy and the house referred to in the letter were not identified. Records show, however, that
petitioner has testified she has a cousin named Candy Shotwell who stayed at the "big house"
since February 1989.58

Clearly, the submission of petitioner to the orders of Adela does not only show that the latter
retained dominion over the Properties, but also that petitioner did not exercise acts of ownership
over it. If at all, her actions only affirm the conclusion that she was merely an administratrix of the
Properties by virtue of the SPA.

No consideration for the sale

We also find no compelling reason to depart from the court a quo's finding that Adela never
received the consideration stipulated in the simulated Deeds of Absolute Sale.

Although on their face, the Deeds of Absolute Sale appear to be supported by valuable
consideration, the RTC and the CA found that there was no money involved in the sale. The
consideration in the Deeds of Absolute Sale was superimposed on the spaces therein, bearing a
font type different from that used in the rest of the document. 61 The lower courts also found that
the duplicate originals of the Deeds of Absolute Sale bear a different entry with regard to the
price.62

Article 1471 of the Civil Code provides that "if the price is simulated, the sale is void." Where a
deed of sale states that the purchase price has been paid but in fact has never been paid, the
deed of sale is null and void for lack of consideration. 63 Thus, although the contracts state that the
purchase price of P250,000.00 and P60,000.00 were paid by petitioner to Adela for the
Properties, the evidence shows that the contrary is true, because no money changed hands.
Apart from her testimony, petitioner did not present proof that she paid for the Properties.