Lim v CA

G.R. No. 104819 July 20, 1998

Art. 1236 – Creditor not bound to accept payment or performance by third person

Facts:

·          Petitioner Lim and respondent Lea Whelan executed a conditional deed of sale over a parcel of land. But the property was mortgaged to the Bank of the Philippine Islands.

·          Whelan then paid an earnest money as stipulated in the contract, thereafter she occupied the premises.

·          Subsequently, Whelan paid Lim. So, a deed of absolute sale was signed by the parties. Lim gave Whelan xeroxed copies of title, realty tax receipts and bills for light and water.

·          After 5 months, Lim demanded Whelan to vacate the subject property. Whelan countered that she was already the owner thereof. Hence, a complaint for ejectment was filed against Whelan.

·          In her defense, Whelan had paid more than enough of what was required from her for the property when she paid the mortgage loan and the capital gains tax over it.

·          Lim asserted that this was done in bad faith as he had no prior knowledge thereof.

Issue:

WoN the payment of the loan and capital gains tax undoubtedly relieved the petitioner from such obligations.

Held:

            Yes, the Court rules that the recourse taken by Whelan is sanctioned by law and jurisprudence and Lim can be bound thereby although he had no prior knowledge thereof considering that the payments made were clearly to his benefit as he was thus spared of being burdened with interests and penalty charges.

            Art. 1236 of the Civil Code provides in part that “Whoever pays for another may demand from the debtor what he has paid, except that if he paid without the knowledge or against the will of the debtor, he can recover only insofar as the payment has been beneficial to the debtor.”

            In the case at bar, the payment of the loan and capital gains tax undoubtedly relieved the appellant from such obligations. The benefit had even been mutual, both appellant and appellee had obtained advantages on their sides — the appellant from his loan and appellee being secured of the possession.

            Thus, the CA decision is affirmed.