manogura digest

G.R. No. L-9871             January 31, 1958

ATKINS, KROLL and CO., INC.,

vs.

B. CUA HIAN TEK

FACTS:

Atkins Kroll & Co. sent a letter to B. Cu HianTek on September 13, 1951, offering  cartons of Luneta brand Sardines subject to reply by September 23, 1951. HianTek unconditionally accepted the said offer through a letter delivered on September 21, 1951, but Atkins failed to deliver the commodities due to the shortage of catch of sardines by the packers in California.

HianTek, therefore, filed an action for damages in the CFI of Manila which granted the same in his favor.

Atkins herein contends that there was no such contract of sale but only an option to buy, which was not enforceable for lack of consideration because it is provided under the 2nd paragraph of Article 1479 of the New Civil Code that "an accepted unilatateral promise to buy or to sell a determinate thing for a price certain is binding upon the promisor if the promise is supported by a consideration distinct from the price.” Atkins also insisted that the offer was a mere offer of option, because the "firm offer" was a continuing offer to sell until September 23.

ISSUE:

Whether  a contract of sale was constituted between the parties or only a unilateral promise to buy.

COURT RULING:

SC held that there was a contract of sale between the parties. ATKIN’s argument assumed that only a unilateral promise arose when the respondent accepted the offer is incorrect because a bilateral contract to sell and to buy was created upon HIAN TEK’s acceptance.

B. CuaHianTek’s letter-reply to Atkins indicated that he accepted "the firm offer for the sale. After accepting the promise and before he exercises his option, the holder of the option is not bound to buy. In this case at bar, however, upon TEK’s acceptance of herein ATKIN's offer, a bilateral promise to sell and to buy ensued, and the respondent had immediately assumed the obligations of a purchaser.

G.R. No. 91029 February 7, 1991

NORKIS DISTRIBUTORS, INC.,

vs.

THE COURT OF APPEALS & ALBERTO NEPALES

FACTS:

Alberto Nepales bought from the Norkis Distributors, Inc. brand new Yamaha motorcycle.The Branch Manager AvelinoLabajo agreed to accept the P7,500.00 price payable by means of a Letter of Guaranty from the Development Bank of the Philippines (DBP), Kabankalan. Hence, credit was extended to Nepales, and as security for the loan, he executed a chattel mortgage on the motorcycle in favor of DBP. Labajo issued the Norkis Sales Invoice perfecting the contract of sale, and Nepales signed the same to conform to the terms of the sale, while the unit remained in Norkis' possession. On November 6, 1979, it was registered under Alberto Nepales’ name in the Land Transportation Commission.

The motorcycle was delivered to a certain Julian Nepales on January 22, 1980,  who was allegedly the agent of Alberto Nepales but the latter denies it.

On February 3, 1980, the motorcycle met an accident while being driven by a certain ZacariasPayba. The unit was a total wreck, was returned, and stored inside Norkis' warehouse.

On March 20, 1980, DBP released the proceeds of respondent's motorcycle loan to Norkis in the total sum of P7,500. As the price of the motorcycle later increased to P7,828, Nepales paid the difference of P328 and demanded the delivery of the motorcycle. Norkis failed to deliver the unit, and Nepales filed an action for specific performance with damages. Norkis answered that the motorcycle had already been delivered to private respondent before the accident, hence, he should bear the risk of loss or damage as owner of the unit.

ISSUE:

Who should bear the risk of loss?

COURT RULING:

The Supreme Court ruled that Article 1496 of the Civil Code which provides that "in the absence of an express assumption of risk by the buyer, the things sold remain at seller's risk until the ownership thereof is transferred to the buyer," is applicable in the case at bar for there was neither an actual nor constructive delivery of the thing sold.

In this case, the purpose of the execution of the sales invoice and the registration of the vehicle in the name of Alberto Nepales with the Land Registration Commission was not to transfer the ownership and dominion over the motorcycle to him, but only to comply with the requirements of the DBP for processing private respondent's motorcycle loan. On March 20, 1980, before private respondent's loan was released and before he even paid Norkis, the motorcycle had already figured in an accident while driven by one ZacariasPayba. Payba was not shown by Norkis to be a representative or relative of private respondent. The circumstances in the case itself more than amply rebut the disputable presumption of delivery upon which Norkis anchors its defense to Nepales' action.

G.R. No. L-25494 June 14, 1972

NICOLAS SANCHEZ

vs.

SEVERINA RIGOS

FACTS:

Nicolas Sanchez and SeverinaRigos executed an instrument entitled "Option to Purchase," whereby Mrs. Rigos agreed, promised and committed  to sell to Sanchez a parcel of land within two (2) years from said date with the understanding that said option shall be deemed terminated and elapsed if Sanchez shall fail to exercise his right to buy the property within the stipulated period. Inasmuch as several tenders of payment made by Sanchez within said period, were rejected by Mrs. Rigos, on March 12, 1963, the former deposited said amount with the Court of First Instance of Nueva Ecija and commenced against the latter the present action, for specific performance and damages.

Rigos contended that the contract between them was only  aunilateral promise to sell, and the same being unsupported by any valuable consideration, by force of the New Civil Code, is null and void.

Sanchez alleged in his compliant that, by virtue of the option under consideration, "defendant agreed and committed to sell" and "the plaintiff agreed and committed to buy" the land described in the option.

The lower court rendered judgment in favor of Sanchez and ordered Rigos to accept the sum Sanchez judicially consigned, and to execute in his favor the requisite deed of conveyance.

ISSUE:

Whether there was a contract to buy and sell between the parties or only a unilateral promise to sell.

COURT RULING:

The Supreme Court affirmed the lower court’s decision.

 The instrument executed in 1961 is not a "contract to buy and sell," but merely granted SANCHEZ an option to buy, as indicated by its own title "Option to Purchase." The option did not impose upon Sanchez the obligation to purchase Rigos' property. Rigos "agreed, promised and committed" herself to sell the land to Sanchez, but there is nothing in the contract to indicate that her aforementioned agreement, promise and undertaking is supported by a consideration "distinct from the price" stipulated for the sale of the land.

 Article 1479 refers to "an accepted unilateral promise to buy or to sell." Since there may be no valid contract without a cause or consideration, the promisor is not bound by his promise and may, accordingly, withdraw it. Pending notice of its withdrawal, his accepted promise partakes, however, of the nature of an offer to sell which, if accepted, results in a perfected contract of sale. 

Possession of Movable Property

EDCA PUBLISHING v. SANTOS

FACTS:

The movable property in this case consists of books, which were bought from EDCA by an impostor who sold it to SANTOS. EDCA Publishing sold to a person identifying himself as Professor Jose Cruz who placed an order by telephone with the former for 406 books, payable on delivery. EDCA prepared the corresponding invoice and delivered the books as ordered, for which Cruz issued a personal check. On October 7, 1981, Cruz then sold the 120 of the books to Leonor Santos who asked for verification, and was then showed the invoice for the books.

Meanwhile, EDCA having become suspicious over a second order placed by Cruz even before clearing of his first check, made inquiries with the De la Salle College where he had claimed to be a dean and was informed that there was no such person in its employ. Further verification revealed that Cruz had no more account or deposit with the Philippine Amanah Bank, against which he had drawn the payment check. EDCA then went to the police, which set a trap and arrested Cruz. Investigation disclosed his real name as Tomas de la Peña and his sale of 120 of the books he had ordered from EDCA to the private respondents.

ISSUE:

Whether or not EDCA PUBLISHINGAND DISTRIBUTING CORP was unlawfully deprived of the property?

HELD:

NO

Santos was a good faith buyer after taking steps to verify the identity of the seller. When she was showed the invoice, she reasonably believed that he was a legitimate seller. With regard to unlawful deprivation, EDCA was not unlawfully deprived of the property by mere failure of consideration. There was already a perfected contract of sale. Proof was even substantiated when EDCA gave the invoice as proof of payment upon delivery of the books. This did not amount to unlawful taking, because by the delivery of EDCA to Cruz, ownership of the books already transferred to him.

It would certainly be unfair now to make the SANTOSES bear the prejudice sustained by EDCA as a result of its own negligence. We cannot see the justice in transferring EDCA's loss to the SANTOSES who had acted in good faith, and with proper care, when they bought the books from Cruz.