Law on Obligations and Contracts

Mother Goose Special School System, Inc. v. Spouses Palaganas [January 20, 2025]

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​In Mother Goose Special School System, Inc. v. Spouses Palaganas, the Supreme Court ruled that the school breached its contractual duty to provide a safe learning environment when a student was repeatedly punched by classmates during a teacher’s absence. The Court emphasized that educational institutions must ensure student safety and cannot solely rely on the “good father of a family” defense in contractual breaches.

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Planters Development Bank v. Heirs of Delos Santos [January 15, 2025]

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​In Planters Development Bank v. Heirs of Delos Santos, the Supreme Court ruled that despite the borrowers’ waiver of demand in the promissory note, the bank was still required to provide personal notice before initiating extrajudicial foreclosure. Failure to do so invalidated the foreclosure proceedings, emphasizing the necessity of proper notification to borrowers. Notwithstanding, the High Court upheld the validity of the foreclosure sale in this case finding that Planters Development Bank complied with its obligation to personally notify Sps. Delos Santos of the same.

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Dela Cruz v. Dumasig [December 4, 2023]

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In Dela Cruz v. Dumasig, the Supreme Court ruled that the sale between Sps. Dela Cruz and their daughter, Rosalinda, was absolutely simulated. Hence, void. Primarily, in view of Rosalinda’s failure to exercise any act of dominion over the property after the sale. Consequently, the Agreement of Loan with Real Estate Mortgage between Rosalinda and Dumasig is also void, the former not being the absolute owner of the subject lot. The Supreme Court also found the former sale void for violating the prohibition against transfer under Presidential Decree 27.

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Keppel Cebu Shipyard vs. Pioneer Insurance [September 18, 2012]

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In Keppel Cebu Shipyard v. Pioneer Insurance, the Supreme Court found both Keppel and WG&A equally negligent for a fire on M/V Superferry 3. The Court upheld the validity of a contract clause limiting Keppel’s liability to ₱50 million, emphasizing that contracts of adhesion are enforceable unless the weaker party is deprived of the opportunity to bargain on equal footing.

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