Civil Law 2- Olivia Navoa and Ernesto Navoa vs. Court of Appeals, Teresita Domdoma and Eduardo Domdoma

This case is with regard to Art 1169 of the NCC - Delay

Olivia Navoa and Ernesto Navoa vs. C.A., Teresita Domdoma and Eduardo Domdoma
GR No 59255 20December1995
Facts:
On December 1977 Teresita Domdoma and Eduardo Domdoma filed a case with the RTC for collection of various sums of money based on loans given by them to Olivia Navoa. They cased was dismissed on the ground that there was no cause of action and that the Domdoma’s do not have no capacity to sue. They appealed to the C.A. and was granted a favourable decision.
There were 6 instances in which the Domdoma’s gave Olivia Navoa a loan. The first instance is when Teresita gave Olivia a diamond ring valued at 15,000.00 which was secured by a PCIB check under the condition that if the ring was not returned within 15 days from August 15, 1977 the ring is considered sold. Teresita attempted to deposit the check on November 1977 but the check was not honoured for lack of funds. After this instance, there were other loans of various amounts that were extended by Teresita to Olivia, loans which were secured by PCIB checks, which were all dated to 1 month after the loan. All these checks were not honoured under the same reason as the first loan.
Issue:
Was the decision of the RTC to dismiss the case due to having no cause of action valid?
- NO, A cause of action is the fact or combination of facts which affords a party a right to judicial interference in his behalf.
- For the first loan it is a fact, that the ring was considered sold to Olivia Navoa 15 days after August 15, 1977, and even then, Olivia Navoa failed to pay the price for the ring when the payment was due (check issued was not honoured. Thus it is confirmed that Teresita’s right under the agreement was violated.
- As for the other loans extended by Teresita to Olivia, they were all secured by PCIB checks. It can be inferred that since the checks were all dated to 1 month after the loan, it follows that the loans are then payable 1 month after they were contracted, and also these checks were dishonoured by the bank for lack of funds.
- Olivia and Ernesto Navoa failed to make good the checks that were issued as payment for their obligations. Art 1169 of the Civil Code is explicit: those obliged to deliver or to do something incur in delay from the time the obligee judicially or extra-judicially demands from them the fulfilment of the obligations, the continuing refusal of Olivia and Ernesto Navoa to comply with the demand of payment shows the existence of a cause of action.

Held:
The petition is DENIED and the decision of the C.A. remanding the case to the RTC for trial on the merits is affirmed.

Obligations and Contracts terms:
Security- A means of ensuring the enforcement of an obligation or of protecting some interest in property. It may be personal or property security.
Cause of Action- is the fact or combination of facts which affords a party a right to judicial interference in his behalf. The requisites for a cause of action are: (a) a right in favour of the plaintiff by whatever means and under whatever law it arises or created, (b) an obligation on the part of the defendant to respect and not to violate such right; and, (c) an act or omission on the part of the defendant constituting a violation of the plaintiff’s right or breach of the obligation of the defendant to the plaintiff.

I hope this helps.

Jeff David