Unjust enrichment

“I give that you may do”. This is the principle invoked in this case of Vic and his employer, Philippine Air Lines (PAL). It is a principle founded on the Civil Code provision against “unjust enrichment”.

Vic started working with PAL as a Boeing 747 Systems Engineer on October 21, 1988. By 1995 at age 39 and already a Boeing 737 First Officer, Vic successfully bid for the higher position of Airbus 300 First Officer. Since said higher position required additional training, he underwent, at PAL’s expense, more than five months of training consisting of ground schooling in Manila and flight simulation in Australia.

After completing the training course, Vic served as A-300 First Officer. Eight months later however or on September 16, 1996, he tendered his resignation for personal reasons, effective October 15, 1996.

But PAL asked Vic to reconsider his proposed resignation. It said that it has invested heavily in Vic’s professional training in the amount of P786,713 on the condition that he should continue to serve the company for at least three years. So PAL said that if he will not reconsider, he will be required to reimburse the amount.

Vic, through his counsel, asked PAL’s explanation considering that he did not sign anything regarding any reimbursement. PAL did not reply, prompting Vic’s lawyer to send two more letters following up the reply and the release of Vic’s clearances so he can avail of the retirement benefits.

Instead of replying, PAL filed a complaint against Vic before the Regional Trial Court for reimbursement of P851,107 worth of training costs, attorney’s fees of 20% and cost of litigation. PAL invoked the existence of an unclassified implied contract of “do ut facias” (I give that you may do) with Vic in that by spending for his training, he would render service to it until the costs of said training were recovered, estimated at three years. Since he has rendered only 8 months, he should reimburse the remaining balance of the cost of his training. Is PAL entitled to reimbursement?

Yes. Every person who through an act of performance by another, or any other means, acquires or comes into possession of something at the expense of another without just or legal ground, shall return the same to him (Article 22 Civil Code).

Enrichment consists in every patrimonial, physical, or moral advantage, so long as it is appreciable in money. It may consist of (1) the enjoyment of a thing belonging to another; (2) the benefits from the service rendered by another; (3) the acquisition of a right, whether real or personal; (4) the increase in value of property; (5) the improvement of a right, such as the acquisition of the right of preference; (6) the recognition of the existence of a right; and (7) the improvement of the conditions of life.

The enrichment must have a correlative prejudice, disadvantage of injury to another, consisting not only of the loss of property or the deprivation of its enjoyment, but also of non-payment of compensation for a service rendered or the failure to acquire something which a person would have obtained. The enrichment of one would not have been produced had it not been for the injury of another.

In this case, PAL admittedly invested for the training of Vic to enable him to acquire a higher level of skill, proficiency, or technical competence so that he could efficiently discharge the position of A-300 First Officer. Given that PAL expected to recover the training costs by availing of Vic’s services for at least three years. PAL’s expectation was not fully realized however due to Vic’s resignation after only eight months of service following the completion of his training course. He cannot therefore refuse to reimburse the costs of training without violating the principle of unjust enrichment (Almario vs. PAL, G.R. 170928, September 11, 2007).  

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