Short answer. No. Where the unlawful act is not a crime and both parties are equally at fault, neither may recover. Article 1412 says that when the fault lies on both contracting parties, neither can get back what he gave or demand the other's performance. The law leaves you both where it found you.
What the law says
When the fault is on the part of both contracting parties, neither may recover what he has given by virtue of the contract, or demand the performance of the other's undertaking
Civil Code, Article 1412 — In Pari Delicto: Non-Criminal. Read the full provision →
Equal fault, no recovery
The article applies where the forbidden cause of the contract does not constitute a criminal offense, and it sets the rule for equal wrongdoers plainly: when the fault is on the part of both contracting parties, neither may recover what he has given by virtue of the contract, or demand the performance of the other's undertaking. This is the principle often summed up as leaving parties in equal fault where they stand. Because you both knowingly entered an unlawful bargain, the courts will not lend their machinery to unwind it for either of you. You cannot claw back what you paid, and equally you cannot force the other side to deliver.
The idea behind the harshness
The result can feel unfair to whoever performed first, but the policy is deliberate. Courts will not become the accountants of an illegal deal, adjusting the losses between two people who both chose to break the law. Denying recovery to both discourages such bargains at the outset, since neither participant can rely on the courts to rescue him if the arrangement sours. The loss is allowed to lie where it has fallen. That is a feature of the rule, not an oversight — the law's refusal to help is itself the deterrent.
When only one side is at fault
The same article treats an innocent party very differently. Where only one of the parties is at fault, the guilty one still cannot recover what he gave or demand performance, but the party who is not at fault may demand the return of what he has given, without having to carry out his own promise. So the equal-fault bar depends on genuine, shared culpability. If you were misled, coerced, or otherwise not truly at fault while the other party was, your position may fall under this more favourable branch rather than the no-recovery rule.
The boundaries of this rule
This provision governs unlawful contracts that are not criminal; where the act agreed upon is itself a crime, a separate and stricter regime decides what may be recovered. The law also recognises limited exceptions elsewhere — for instance, a party who repudiates an illegal purpose in time, before it is accomplished, may under Article 1414 be allowed by the court to recover. And the rule fixes the consequences of the illegality between the parties; it does not bless the underlying transaction or shield either of them from any separate liability the unlawful conduct may attract.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Hiers of Policronio M. Ureta, Sr., namely: Conrado B. Ureta, et al. vs. Heirs of Liberato M. Ureta, namely: Teresa F. Ureta, et al./Heirs of Liberato M. Ureta, namely: Teresa F. Ureta, et al. vs. Heirs of Policronio M. Ureta, Sr., namely: Conrado B. Ureta, et al, G.R. No. 165748 / G.R. No. 165930, September 14, 2011 — read the decision on LawPhil →
- Jose Menchavez, et al. vs. Florentino Teves Jr, G.R. No. 153201, January 26, 2005 — read the decision on LawPhil →
- Desiderio Ranara, Jr. vs. Zacarias De Los Angeles, Jr, G.R. No. 200765, August 8, 2016 — read the decision on LawPhil →
- Oscar Constantino, et al. vs. Heirs of Pedro Constantino, Jr., rep. by Asuncion Laquindanum, G.R. No. 181508, October 2, 2013 — read the decision on LawPhil →
Related provisions
- Civil Code, Article 1412 — In Pari Delicto: Non-Criminal
- Civil Code, Article 1414 — Repudiation Before the Illegal Purpose