Harry Don G. Zosa
3 CASE DIGESTS
(De Guzman vs. Toyota, G.R. No. 141480, November 29, 2006)
FACTS:
On November 27, 1997, petitioner purchased from respondent a brand new white Toyota Hi-Lux. The vehicle was delivered to petitioner two days later. On October 18, 1998, petitioner demanded the replacement of the engine of the vehicle because it developed a crack after traversing Marcos Highway during a heavy rain. Petitioner asserted that respondent should replace the engine with a new one based on an implied warranty.
On the other hand, respondent maintains that petitioner’s cause of action was already barred by the statute of limitations under Article 1571 of the Civil Code for having been filed more than six months from the time the vehicle was purchased and/or delivered. Respondent reiterates that Article 169 of Republic Act No. 7394 does not apply.
HELD:
Under Article 1599 of the Civil Code, once an express warranty is breached, the buyer can accept or keep the goods and maintain an action against the seller for damages. In the absence of an existing express warranty on the part of the respondent, as in this case, the allegations in petitioner’s complaint for damages were clearly anchored on the enforcement of an implied warranty against hidden defects, i.e., that the engine of the vehicle which respondent had sold to him was not defective.
By filing this case, petitioner wants to hold respondent responsible for breach of implied warranty for having sold a vehicle with defective engine. Such being the case, petitioner should have exercised this right within six months from the delivery of the thing sold. Since petitioner filed the complaint on April 20, 1999, or more than nineteen months counted from November 29, 1997 (the date of the delivery of the motor vehicle), his cause of action had become time-barred.
Petitioner contends that the subject motor vehicle comes within the context of Republic Act No. 7394. Thus, petitioner relies on Article 68 (f) (2) in relation to Article 169 of Republic Act No. 7394. Article 4 (q) of the said law defines “consumer products and services” as goods, services and credits, debts or obligations which are primarily for personal, family, household or agricultural purposes, which shall include, but not limited to, food, drugs, cosmetics, and devices. The following provisions of Republic Act No. 7394 state:
Art. 67. Applicable Law on Warranties. — The provisions of the Civil Code on conditions and warranties shall govern all contracts of sale with conditions and warranties.
Art. 68. Additional Provisions on Warranties. — In addition to the Civil Code provisions on sale with warranties, the following provisions shall govern the sale of consumer products with warranty:
e) Duration of warranty. The seller and the consumer may stipulate the period within which the express warranty shall be enforceable. If the implied warranty on merchantability accompanies an express warranty, both will be of equal duration.
Any other implied warranty shall endure not less than sixty (60) days nor more than one (1) year following the sale of new consumer products.
Consequently, even if the complaint is made to fall under the Republic Act No. 7394, the same should still be dismissed since the prescriptive period for implied warranty thereunder, which is one year, had likewise lapsed.
(MAGNA FINANCIAL SERVICES GROUP, INC., vs. COLARINA G.R. No. 158635 December 9, 2005)
FACTS:
Colarina bought from petitioner a Suzuki Multicab payable on installments and secured by an integrated promissory note and a deed of chattel mortgage. Upon respondent’s default in payment, petitioner filed a complaint for Foreclosure of the Chattel Mortgage with Replevin. Colarina then voluntarily surrendered the physical possession of the vehicle. Failing to answer within the reglementary perion, the Municipal Trial Court ordered respondent to pay petitioner the unpaid balance of the vehicle’s purchase price. This was affirmed by the Regional Trial Court. The Court of Appeals, on the other hand, reversed and set aside the decisions of the lower courts granting the payment of the payment of the unpaid balance for being inconsistent with petitioner’s complaint for foreclosure.
ISSUE:
Whether or not the foreclosure of mortgage, as an exercise of the 3rd remedy in Article 1484, is in nature an action for sum of money with execution of the security.
HELD:
No. A Contract of chattel mortgage is in the nature of a conditional sale of personal property given as a security for the payment of a debt, or the performance of some other obligation specified therin, the condition being that the sale shall be void upon the seller paying to the purchaser a sum of money or doing some other act named. If the condition is performed according to its terms, the mortgage and sale immediately become void, and the mortgage is thereby divested of his title. But in case of nonpayment, foreclosure is one of the alternative remedies available to a mortgagee. Since the petitioner has undeniably elected a remedy of foreclosure under Article 1484(3) of the Civil Code, it is bound by its election and thus may not be allowed to change what it has opted for nor to ask for more.
(VILLOSTAS vs. COURT OF APPEALS G.R. No. 96271 June 26, 1992)
FACTS:
Petitioner Villostas and her husband placed an order for one unit of water purifier from private respondent's Electrolux sales agents. Private respondent's sales agents assured petitioner of the very special features of their brand of water purifier. On September 13, 1986, an Electrolux Aqua Guard Water purifier was delivered and installed at petitioner's residence. Petitioner signed the Sales Order and the Contract of Sale with Reservation of Title in October 1986. A warranty certificate was issued by private respondent which provides that the product will perform efficiently for one full year from date of original purchase. The purchase of said unit was on installment basis under which petitioner would pay the amount of P16,190.00 in 20 monthly installments of P635.00 a month. However, after two (2) weeks, petitioner verbally complained about the impurities, dirtiness and bad odor coming out of the unit. Thus, private respondent Electrolux changed the filter of the unit. Petitioner complained for the second and third time when dirty water still came out of the water purifier after the replacement of the filter. It was on the third complaint of petitioner when the service technician gave advise that the filter should be changed every six (6) months costing about P300.00 which was considered to be uneconomical by the former. On December 9, 1986, petitioner sent a letter to the private respondent's branch manager stating the herein complaint that the actual performance of the carbon filter was only for a month instead of the private respondent's claim that the replacement of such filter will be only once every six (6) months. The petitioner, citing the above incident as uneconomical, decided to return the unit and demand a refund for the amount paid. Electrolux's branch manager offered to change the water purifier with another brand or any of its appliance of the unit in her favor. Petitioner did not accept it as she was disappointed with the original unit which did not perform as warranted.
ISSUE:
Whether or not the petitioner is entitled to rescind the contract on the basis of a violation of the warranty of the article delivered by the respondent?
HELD:
Yes. At the time the Electrolux Aqua Guard water purifier was delivered and installed at petitioner Villostas' residence a Warranty Certificate was issued by private respondent Electrolux which provides that the product will perform efficiently for one full year from date of original purchase. It clearly expresses warranty regarding the efficiency of the water purifier. On this regard, while it is true that Article 1571 of the Civil Code provides for a prescriptive period of six months for a redhibitory action, a cursory reading of the ten preceding articles to which it refers will reveal that said rule may be applied only in case of implied warranties. The present case involves one with an express warranty.
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