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Lao and Manansala vs. Special Plans, Inc.

Selwyn F. Lao and Edgar Manansala, Petitioners, versus Special Plans, Inc., Respondent.

G.R. No. 164791 | 2010-06-29

D E C I S I O N

DEL CASTILLO, J.:

In Roman Law, compensation was the reciprocal extinction of claims between mutual debtors. In the earlier stages of that system the practice did not exist as a matter of right but its application was discretionary with the judex. Later the praetor applied it by incorporating into the formula, which he prepared for the judex, an exception doli, that is, an authorization to take into account any circumstances which would render inequitable the enforcement of the claim. The effect was to cause a dismissal of the claim, however large, if a counterclaim, however small, was proven and the indirect result was to...