Case Analysis. Analyze the cases and answer the given questions

1.LEGASPI OIL CO., INC. vs. THE COURT OF APPEALS and BERNARD OSERAOS [G.R. No. 96505; July 1, 1993]

FACTS:

Private Respondent Bernard Oseraos acting through his authorized agents, had several transactions with Legaspi Oil Co. for the sale of copra to the latter. In 1976, Oseraos' agent signed a contract for the sale of copra at P82.00/100 kg with delivery terms of 20 days. However, the period to deliver had lapsed and respondent delivered only 46,334 kg of copra, leaving an undelivered balance of 53,666 kg. Petitioner made repeated demands but Oseraos elected to ignore the same. A final demand with a warning was issued that should Oseraos fail to complete the delivery, petitioner would purchase the balance at the open market and charge the price differential to the latter, still Oseraos failed to deliver the remaining balance. Hence, petitioner exercised its right under the contract and purchased the undelivered balance at the open market at the then prevailing price of P168.00/100 kg.

Question:

Is Oseraos liable for damages arising from fraud or bad faith in deliberately breaching the contract of sale entered into by the parties? Explain the grounds for his liability, if any.

2.SSS vs. MOONWALK DEVELOPMENT AND HOUSING CORPORATION [G.R. No. 73345. April 7, 1993] FACTS:

Plaintiff SSS approved the application of Defendant Moonwalk for a loan of P30,000,000 for the purpose of developing and constructing a housing project. Out of P30,000,000 approved loan, the sum of P9,595,000 was released to defendant Moonwalk. A third Amendment Deed of Mortgage was executed for the payment of the amount of P9,595,000. Moonwalk made a total payment of P23,657,901.84 to SSS for the loan principal of P12,254,700.

After settlement of the account, SSS issued to Moonwalk the release of Mortgage for Moonwalk's Mortgaged properties. In a letter to Moonwalk, SSS alleged that it committed an honest mistake in releasing defendant; that Moonwalk has still 12% penalty for failure to pay on time the amortization which is in the penal clause of the contract.

Moonwalk's counsel told SSS that it had completely paid its obligation to SSS and therefore there is no recovery of any penalty.

Question:

Is the penalty demandable even after the extinguishment of the principal obligation? Explain your answer.