PEOPLE OF THE PHILIPPINES v.

DEMOCRITO PARAS
G.R. No. 192912, 3 October 2014, SPECIAL FIRST DIVISION, (Leonardo-
De Castro, J.)

Upon the death of the accused pending appeal of his conviction, the criminal action is
extinguished inasmuch as there is no longer a defendant to stand as the accused; the civil action
instituted therein for the recovery of civil liability ex delicto is ipso facto extinguished, grounded as it
is on the criminal action.

Democrito Paras was charged with one count of rape. The Regional Trial
Court (RTC) found Paras guilty as charged which was affirmed by the Court of
Appeals (CA). Paras appealed the decision of CA before the Supreme Court. The
Court affirmed the judgment of conviction against Paras. However, Police
Superintendent Roberto R. Rabo, Officer-in-Charge of the New Bilibid Prison,
informed the Court that Paras had died at the New Bilibid Prison Hospital.

ISSUE:

Is the civil liability of Paras extinguished together with his criminal liability
in case of death pending appeal?

RULING:

Yes. Under Article 89, paragraph 1 of the Revised Penal Code, as amended,
the death of an accused pending his appeal extinguishes both his criminal and civil
liability ex delicto.

The Court, in People v. Bayotas, enunciated the following guidelines

construing the above provision in case the accused dies before final judgment:

1. Death of the accused pending appeal of his conviction

extinguishes his criminal liability as well as the civil
liability based solely thereon. As opined by Justice
Regalado, in this regard, "the death of the accused prior
to final judgment terminates his criminal liability
and only the civil liability directly arising from and based
solely on the offense committed, i.e., civil liability ex
delicto in sensostrictiore."

2. Corollarily, the claim for civil liability survives

notwithstanding the death of accused, if the same may
also be predicated on a source of obligation other than
delict. Article 1157 of the Civil Code enumerates these
other sources of obligation from which the civil liability
may arise as a result of the same act or omission: a)Law;
b)Contracts; c)Quasi-contracts; d)xxx; e) Quasi-delicts

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 3. Where the civil liability survives, as explained in Number
2 above, an action for recovery therefor may be pursued but
only by way of filing a separate civil action and subject to
Section 1, Rule 111 of the 1985 Rules on Criminal
Procedure as amended. This separate civil action may be
enforced either against the executor/administrator or the
estate of the accused, depending on the source of obligation
upon which the same is based as explained above.

In this case, when Paras died on January 24, 2013, his appeal tothe Court
was still pending. The death of Paras, thus, extinguished his criminal liability, as well
as his civil liability directly arising from and based solely on the crime committed.

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 PHILNICO INDUSTRIAL CORPORATIONv.
PRIVATIZATION AND MANAGEMENT OFFICE
G.R. Nos. 199420 and 199432, 27 August 2014, FIRST DIVISION, (Leonardo-
De Castro, J.)

“Pactumcommissorium” is among the contractual stipulations that are deemed contrary to

law. It is defined as a stipulation empowering the creditor to appropriate the thing given as guaranty
for the fulfillment of the obligation in the event the obligor fails to live up to his undertakings,
without further formality.

Philnico Industrial Corporation (PIC) entered into a contract, with the

Privatization and Management Office (PMO) and Philnico Processing Corporation
(PPC) known to them as the Amended andRestated Definitive Agreement
(ARDA)with the stipulations, among others,that: (1) PMO agrees to sell the 90%
shares of stock of PPC which they own to PIC through instalments;(2) PIC will
execute a Pledge Agreement, pledging the peso equivalent of the shares of stock it
sought to purchase as a security for the purchase upon satisfaction of certain
conditions; and (2) the consequence of default is automatic reversion of the
involved shares of stock in favor of PMO upon failure of PIC to remedy the said
event within a given period.

Years later, PIC failed to settle their unpaid amortizations despite due
notification by PMO. Thus, PMO warned PIC that the former will enforce the
reversion clause in the ARDA if the latter fails to settle its outstanding obligations
within a given period. However, a day before the said period expired, PIC sought
relief with the courts regarding the prohibition against Reversion of Shares averring
that the automatic reversion constitutes a pactumcommissorium, an act expressly
prohibited by Article 2088 of the Civil Code. The Regional Trial Court (RTC) found
that the contract involves a pactumcommissorium. However, the Court of Appeals (CA)
reversed the RTC ruling stating that the elements for pactumcommissoriumis not
present in the contract.

ISSUE:

Is the reversion clause in the ARDA a case of pactum commissorium?

RULING:

Yes. There are two elements for pactum commissoriumto exist: (1) that there
should be a pledge or mortgage wherein a property is pledged or mortgaged by way
of security for the payment of the principal obligation; and (2) that there should be a
stipulation for an automatic appropriation by the creditor of the thing pledged or
mortgaged in the event of non-payment of the principal obligation within the
stipulated period.

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 Both elements of pactum commissoriumare present in the instant case: (1) By
virtue of the Pledge Agreement, PIC pledged its PPC shares of stock in favor of
PMO as security for the fulfilment of the former’s obligations under the ARDA and
the Pledge Agreement itself; and (2) There is automatic appropriation as under
Section 8.02 of the ARDA, in the event of default by PIC, title to the PPC shares of
stock shall ipso factorevert from PIC to PMO without need of demand.

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