the “misrepresentation constituting the fraud must be established by full, clear, and convincing evidence, and not merely by a preponderance thereof.

The Civil Code, however, does not mandate the quantum of evidence required to prove actionable fraud, either for purposes of annulling a contract (dolo causante) or rendering a party liable for damages (dolo incidente). The definition of fraud is different from the quantum of evidence needed to prove the existence of fraud. Article 1338 provides the legal definition of fraud. Articles 1339 to 1343 constitute the behavior and actions that, when in conformity with the legal provision, may constitute fraud.

Jurisprudence has shown that in order to constitute fraud that provides basis to annul contracts, it must fulfill two conditions. First, the fraud must be dolo causante or it must be fraud in obtaining the consent of the party. Second, this fraud must be proven by clear and convincing evidence. In Viloria v. Continental Airlines,^[58] this Court held that:

Under Article 1338 of the Civil Code, there is fraud when, through insidious words or machinations of one of the contracting parties, the other is induced to enter into a contract which, without them, he would not have agreed to. In order that fraud may vitiate consent, it must be the causal (dolo causante), not merely the incidental (dolo incidente), inducement to the making of the contract. In Samson v. Court of Appeals, causal fraud was defined as “a deception employed by one party prior to or simultaneous to the contract in order to secure the consent of the other.”

Also, fraud must be serious and its existence must be established by clear and convincing evidence. (Citations omitted)^[59]

ALEJANDRO V. TANKEH, PETITIONER, VS. DEVELOPMENT BANK OF THE PHILIPPINES, STERLING SHIPPING LINES, INC., RUPERTO V. TANKEH, VICENTE ARENAS, AND ASSET PRIVATIZATION TRUST, RESPONDENTS.