G.R. No.

180764
Titus B. Villanueva, petitioner
vs.
Emma M. Rosqueta, respondent

Subject: Principle of Abuse of Rights

FACTS:

Emma M. Rosqueta, formerly the Deputy Commissioner of the Revenue Collection and Monitoring
Group (RCMG) of the Bureau of Customs (BOC), tendered her courtesy resignation on January 23, 2001.
However, on June 5, 2001, 5 months from resignation date, she withdrew her resignation claiming that she
enjoyed security of tenure and that she resigned against her will on orders of her superior. Meanwhile, on July
13, 2001 the newly elected president Arroyo appointed Gil Valera to Rosqueta's position. Challenging such
appointment, Rosqueta filed a petition for prohibition, quo warranto, and injunction against Titus B. Villanueva,
then Commissioner of Customs, the Secretary of Finance, and Gil Valera at the RTC. RTC issued a writ of
preliminary injunction, which was the subject of a TRO from the Court of Appeals but then was again in force
after the lapse of 60 days on November 22, 2001. On February 28, 2002 respondent Rosqueta filed a complaint
for damages before the RTC of Quezon City against petitioner Villanueva, alleging that the latter maliciously
excluded her from the centennial anniversary memorabilia. Further, she claimed that he prevented her from
performing her duties as Deputy Commissioner, withheld her salaries, and refused to act on her leave
applications. Thus, she asked the RTC to award her ₱1,000,000.00 in moral damages, ₱500,000.00 in exemplary
damages, and ₱300,000.00 in attorney’s fees and costs of suit. But the RTC dismissed respondent Rosqueta’s
complaint, stating that petitioner Villanueva committed no wrong and incurred no omission that entitled her to
damages. The RTC found that Villanueva had validly and legally replaced her as Deputy Commissioner seven
months before the Bureau’s centennial anniversary.
But the CA reversed the RTC’s decision, holding instead that petitioner Villanueva’s refusal to comply
with the preliminary injunction order issued in the quo warranto case earned for Rosqueta the right to recover
moral damages from him. Citing the abuse of right principle, the RTC said that Villanueva acted maliciously
when he prevented Rosqueta from performing her duties, deprived her of salaries and leaves, and denied her
official recognition as Deputy Commissioner by excluding her from the centennial anniversary memorabilia.
Thus, the appellate court ordered Villanueva to pay ₱500,000.00 in moral damages, ₱200,000.00 in exemplary
damages and ₱100,000.00 in attorney’s fees and litigation expenses. With the denial of his motion for
reconsideration, Villanueva filed this petition for review on certiorari under Rule 45.

ISSUE: Whether or not the petitioner Villanueva is liable for damages to respondent Rosqueta for ignoring the
preliminary injuction order that the RTC issued, thus denying respondent of her right to do her job as Deputy
Commissioner of the BOC and to be officially recognized as such public officer?

RULING:

Yes, petitioner is liable for moral damages of P200, 000, exemplary damages of P50, 000 and P50, 000 in
attorney's fees.

Under the abuse of right principle found in Article 19 of the Civil Code, a person must, in the exercise of
his legal right or duty, act in good faith. He would be liable if he instead acts in bad faith, with intent to
prejudice another. Complementing this principle are Articles 2010 and 2111 of the Civil Code which grant the
latter indemnity for the injury he suffers because of such abuse of right or duty.
 That Petitioner Villanueva ignored the injunction shows bad faith and intent to spite Rosqueta who
remained in the eyes of the law the Deputy Commissioner. His exclusion of her from the centennial anniversary
memorabilia was not an honest mistake by any reckoning. Indeed, he withheld her salary and prevented her
from assuming the duties of the position.

Go vs. Cordero
G.R. No 164703
May 4, 2010

Subject Matter: Principle of Abuse of Rights

FACTS:
In 1996, Mortimer F. Cordero, Vice-President of Pamana Marketing Corporation (Pamana), ventured into
the business of marketing inter-island passenger vessels. After contacting various overseas fast ferry
manufacturers from all over the world, he came to meet Tony Robinson, an Australian national, who is the
Managing Director of Aluminium Fast Ferries Australia (AFFA). Robinson signed documents appointing Cordero
as the exclusive distributor of AFFA catamaran and other fast ferry vessels in the Philippines. As such exclusive
distributor, Cordero offered for sale to prospective buyers the 25-meter Aluminium Passenger catamaran
known as the SEACAT 25.

After negotiations with Felipe Landicho and Vincent Tecson, lawyers of Allan C. Go who is the
owner/operator of ACG Express Liner, Cordero was able to close a deal for the purchase of two (2) SEACAT 25
as evidenced by the Memorandum of Agreement. Accordingly, the parties executed Shipbuilding Contract No.
7825 for one (1) high-speed catamaran (SEACAT 25) for the price of US$1,465,512.00. Per agreement between
Robinson and Cordero, the latter shall receive commissions totalling US$328,742.00, or 22.43% of the purchase
price, from the sale of each vessel.

Cordero made two (2) trips to the AFFA Shipyard in Brisbane, Australia, and on one (1) occasion even
accompanied Go and his family and Landicho, to monitor the progress of the building of the vessel. He
shouldered all the expenses for airfare, food, hotel accommodations, transportation and entertainment during
these trips. He also spent for long distance telephone calls to communicate regularly with Robinson, Go,
Tecson and Landicho.

However, Cordero later discovered that Go was dealing directly with Robinson when he was informed
by Dennis Padua of Wartsila Philippines that Go was canvassing for a second catamaran engine directly from
AFFA. Cordero tried to contact Go and Landicho to confirm the matter but they were nowhere to be found,
while Robinson refused to answer his calls. Cordero immediately flew to Brisbane to clarify matters with
Robinson, only to find out that Go and Landicho were already there in Brisbane negotiating for the sale of the
second SEACAT 25. Despite repeated follow-up calls, no explanation was given by Robinson, Go, Landicho and
Tecson who even made Cordero believe there would be no further sale between AFFA and ACG Express Liner.
In a handwritten letter, Cordero informed Go that such act of dealing directly with Robinson violated his
exclusive distributorship and demanded that they respect the same, without prejudice to legal action against
him and Robinson should they fail to heed the same. Cordero’s lawyer, Atty. Tabujara, Jr. ,also wrote ACG
Express Liner assailing the fraudulent actuations and misrepresentations committed by Go in connivance with
his lawyers (Landicho and Tecson) in breach of Cordero’s exclusive distributorship appointment.
In response, lawyers of AFFA and Robinson, faxed a letter to Cordero’s counsel asserting that the appointment
of Cordero as AFFA’s distributor was for the purpose of one (1) transaction only, that is, the purchase of a high-
speed catamaran vessel by ACG Express Liner and that Cordero was offered the exclusive distributorship, the
terms of which were contained in a draft agreement which Cordero allegedly failed to return to AFFA within a
reasonable time, and which offer is already being revoked by AFFA.
 As to the response of Go, Landicho and Tecson to his demand letter, Cordero testified before the trial
court that on the same day, Landicho, acting on behalf of Go, talked to him over the telephone and offered to
amicably settle their dispute. Tecson and Landicho offered to convince Go to honor his exclusive distributorship
with AFFA and to purchase all vessels for ACG Express Liner through him for the next three (3) years. In an
effort to amicably settle the matter, Landicho, acting in behalf of Go, set up a meeting with Cordero however,
only Landicho and Tecson came and no reason was given for Go’s absence. Tecson and Landicho proposed
that they will convince Go to pay him US$1,500,000.00 on the condition that they will get a cut of 20%. And so
it was agreed between him, Landicho and Tecson that the latter would give him a weekly status report and that
the matter will be settled in three (3) to four (4) weeks and neither party will file an action against each other
until a final report on the proposed settlement. No such report was made by either Tecson or Landicho who, it
turned out, had no intention to do so and were just buying time as the catamaran vessel was due to arrive from
Australia.
Cordero instituted a civil case seeking to hold Robinson, Go, Tecson and Landicho liable jointly and solidarily
for conniving and conspiring together in violating his exclusive distributorship in bad faith and wanton
disregard of his rights, thus depriving him of his due commissions and unpaid commission for the sale of the
second and causing him actual, moral and exemplary damages, including ₱800,000.00 representing expenses
for airplane travel to Australia, telecommunications bills and entertainment, on account of AFFA’s untimely
cancellation of the exclusive distributorship agreement. Cordero also prayed for the award of moral and
exemplary damages, as well as attorney’s fees and litigation expenses.

ISSUE: Whether or not the rights of Cordero under the Exclusive Distributorship Agreement with AFFA has
been violated?

RULING:

It was established that petitioner Cordero was not paid the balance of his commission by respondent
Robinson. From the time petitioner Go and respondent Landicho directly dealt with respondent Robinson in
Brisbane, and ceased communicating through petitioner Cordero as the exclusive distributor of AFFA in the
Philippines, Cordero was no longer informed of payments remitted to AFFA in Brisbane. In other words,
Cordero had clearly been cut off from the transaction until the arrival of the first SEACAT 25 which was sold
through his efforts. When Cordero complained to Go, Robinson, Landicho and Tecson about their acts
prejudicial to his rights and demanded that they respect his exclusive distributorship, Go simply let his lawyers
led by Landicho and Tecson handle the matter and tried to settle it by promising to pay a certain amount and
to purchase high-speed catamarans through Cordero. However, Cordero was not paid anything and worse,
AFFA through its lawyer in Australia even terminated his exclusive dealership insisting that his services were
engaged for only one (1) transaction, that is, the purchase of the first SEACAT 25.

Respondents clearly acted in bad faith in bypassing Cordero as they completed the remaining payments
to AFFA without advising him and furnishing him with copies of the bank transmittals as they previously did,
and directly dealt with AFFA through Robinson regarding arrangements for the arrival of the first SEACAT 25 in
Manila and negotiations for the purchase of the second vessel pursuant to the Memorandum of Agreement
which Cordero signed in behalf of AFFA. As a result of respondents’ actuations, Cordero incurred losses as he
was not paid the balance of his commission from the sale of the first vessel and his exclusive distributorship
revoked by AFFA.
The existence of malice, ill will or bad faith is a factual matter. As a rule, findings of fact of the trial court,
when affirmed by the appellate court, are conclusive on this Court. We see no compelling reason to reverse the
findings of the RTC and the CA that respondents acted in bad faith and in utter disregard of the rights of
Cordero under the exclusive distributorship agreement.
 The failure of Robinson, Go, Tecson and Landicho to act with fairness, honesty and good faith in
securing better terms for the purchase of high-speed catamarans from AFFA, to the prejudice of Cordero as the
duly appointed exclusive distributor, is further proscribed by Article 19 of the Civil Code:

Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with
justice, give everyone his due, and observe honesty and good faith.