45.
AEROSPACE CHEMICAL Vs CA Case Digest
AEROSPACE CHEMICAL Vs CA
g.r.no. 108129 September 23, 1999
FACTS: On June 27, 1986, petitioner Aerospace Industries,
Inc. (Aerospace) purchased five hundred (500) metric tons of
sulfuric acid from private respondent Philippine Phosphate
Fertilizer Corporation (Philphos). Initially set beginning July
1986, the agreement provided that the buyer shall pay its
purchases in equivalent Philippine currency value, five days
prior to the shipment date. Petitioner as buyer committed to
secure the means of transport to pick-up the purchases from
private respondent's loadports. Per agreement, one hundred
metric tons (100 MT) of sulfuric acid should be taken from
Basay, Negros Oriental storage tank, while the remaining four
hundred metric tons (400 MT) should be retrieved from Sangi,
Cebu. On December 18, 1986, M/T Sultan Kayumanggi
docked at Sangi, Cebu, but withdrew only 157.51 MT of
sulfuric acid. Again, the vessel tilted. Further loading was
aborted. Two survey reports conducted by the Societe
Generale de Surveillance (SGS) Far East Limited, dated
December 17, 1986 and January 2, 1987, attested to these
occurrences. Later, on a date not specified in the record, M/T
Sultan Kayumanggi sank with a total of 227.51 MT of sulfuric
acid on board. Petitioner chartered another vessel, M/T Don
Victor, with a capacity of approximately 500 MT.6 [TSN,
September 1, 1989, pp. 28-29.] On January 26 and March 20,
1987, Melecio Hernandez, acting for the petitioner, addressed
letters to private respondent, concerning additional orders of
sulfuric acid to replace its sunken purchases.
ISSUE: Should expenses for the storage and preservation of
the purchased fungible goods, namely sulfuric acid, be on
seller's account pursuant to Article 1504 of the Civil Code?
RULING: Petitioner tries to exempt itself from paying rental
expenses and other damages by arguing that expenses for the
preservation of fungible goods must be assumed by the seller.
Rental expenses of storing sulfuric acid should be at private
respondent's account until ownership is transferred, according
to petitioner. However, the general rule that before delivery, the
risk of loss is borne by the seller who is still the owner, is not
applicable in this case because petitioner had incurred delay in
the performance of its obligation. Article 1504 of the Civil Code
clearly states: "Unless otherwise agreed, the goods remain at
the seller's risk until the ownership therein is transferred to the
buyer, but when the ownership therein is transferred to the
buyer the goods are at the buyer's risk whether actual delivery
has been made or not, except that: (2) Where actual delivery
has been delayed through the fault of either the buyer or seller
the goods are at the risk of the party at fault."
On this score, we quote with approval the findings of the
appellate court, thus: The defendant [herein private
respondent] was not remiss in reminding the plaintiff that it
would have to bear the said expenses for failure to lift the
commodity for an unreasonable length of time.But even
assuming that the plaintiff did not consent to be so bound, the
provisions of Civil Code come in to make it liable for the
damages sought by the defendant.
69. ELISCO TOOL MFG CORP vs. CAGR No. 109966,
May31, 1999
FACTS: Private respondent Rolando Lantan entered into an
agreement with his employer, herein petitioner, leasing unto
the former a Colt lancer from a period of 5 years. The contract
also provided that at the end of the 5 year period, Lantan may
exercise the option to purchase price of the car and he should
just pay the remaining balance. Said option is limited to the
employee. It also provided that upon Lantan’s failure to pay 3
accumulated monthly rentals, the petitioner will have the option
to lease said vehicle to another. Lantan also has to return the
car in case he resigns or is dismissed. He was laid off after
petitioner ceased operations in 1981. At that time, he has paid
P61, 070.94. Petitioner then filed a replevin casea gainst
Lantan and his wife, alleging that they have failed to pay the
monthly rentals despite repeated demands.
The trial court sustained private respondents’ claim that the
agreement in question was one of
sale and held that the latter had fully paid the price of the car
having paid the total amount of P61,070.94aside from installing
accessories in the car worth P15,000.00. Petitioner appealed
with the CA which affirmed the decision of the trial court in toto.
ISSUE: WON the agreement between the parties is one of
sale.
RULING :Although the agreement provides for the payment by
Lantan of monthly rentals, the fifth paragraph thereof gives
them the option to purchase the motor vehicle at the end of the
fifth year or upon payment of the 60th monthly rental when all
monthly rentals shall be applied to the payment of the full
purchase price of the car. Clearly, the transaction is a lease in
name only. The so-called monthly rentals are in truth monthly
amortizations on the cars price. Being a contract of sale on
installment, Articles 1484 and 1485 apply. As such, the case
should be considered as one for specific performance pursuant
to Article 1484 (1). The remedies provided for in Art.1484 are
alternative, not cumulative. The exercise of one bars the
exercise of the others. This limitation applies to contracts
purporting to be leases of personal property with option to buy
by virtue of Art. 1485. The condition that the lessor has
deprived the lessee of possession or enjoyment of the thing for
the purpose of applying Art. 1485 was fulfilled in this case by
the filing by petitioner of the complaint for replevin to recover
possession of movable property. The prayer for a writ of
replevin is only for the purpose of ensuring specific
performance by private respondents. However, the private
respondents could no longer be held liable for the payment of
intereston unpaid monthly rentals since it was entered into in
pursuance of a car plan adopted by petitioner forthe benefit of
its deserving employees. Further, private respondents default
in payment was due to the cessation of operations of
petitioner’s sister company, Elizalde Steel Company. That
petitioner accepted payments from Lantan more than two
years after the latter’s employment have been terminated
constitutes a waiver of petitioner’s right to collect interest upon
delayed payment. What private respondents paid should be
considered the payment in full.
Pagtalunan v. Vda.deManzano
G.R. No. 147695, September 13, 2007
FACTS:
Patricio Pagtalunan, petitioner’s stepfather, entered into a
Contract to Sell with private respondent Rufina Manzano over
a house and lot for P17,000 to be paid in the following manner:
P1,500 as downpayment upon execution of the Contract and
the balance to be paid in equal monthly installments of P150
on or before the last day of each month until fully paid.
The contract provides that while respondent could immediately
occupy the house and lot, in case of default in the payment of
any of the installments for 90 days after its due date, the
contract would be automatically rescinded without need of
judicial declaration; all payments made and all improvements
done on the premises by respondent would be considered as
rentals for the use and occupation of the property or payment
for damages suffered; and that respondent should peacefully
vacate the premises and deliver the possession thereof back to
the vendor.
Petitioner Pagtalunan alleged that Manzano stopped paying
after December 1979 without any justification or explanation
and that the latter paid only P12,950.Pagtalunan asserted that
when respondent ceased paying her installments, her status of
buyer was automatically transformed to that of a lessee.
Pagtalunan issued a demand letter for Manzano to vacate the
premises of the property but Manzano ignored the same. Thus,
Pagtalunan filed a Complaint for unlawful detainer against
respondent with the Municipal Trial Court (MTC) of Guiguinto,
Bulacan.
The MTCfound for Pagtalunan, holding that failure to pay not a
few installments caused the resolution or termination of the
Contract to Sell. After her last payment of the installment,
Manzano’s right of possession ipso facto ceased to be a legal
right, and became possession by mere tolerance of Patricio
and his successors-in-interest. Said tolerance ceased upon
demand on respondent to vacate the property.
On appeal, the RTC of Malolos, Bulacan reversed the decision
of the MTC and dismissed the case for lack of merit, ruling that
the agreement could not be automatically rescinded since
there was delivery to the buyer. A judicial determination of
rescission must be secured by petitioner as a condition
precedent to convert the possession de facto of respondent
from lawful to unlawful.
The Court of Appeals affirmed the RTC’s decision but held that
the parties, as well as the MTC and RTC, failed to advert to
and to apply the Maceda Law (RA 6522). It ruled that the
Contract to Sell was NOT VALIDLY cancelled or rescinded
under Sec. 3 (b) of the Maceda Law, and recognized
respondent’s right to continue occupying unmolested the
property subject of the contract to sell.
ISSUE:
WON the contract has been automatically rescinded pursuant
to the agreement when Manzano defaulted in the payment of
her installments?
RULING:
NO, the contract has not been automatically rescinded.
While the Court agrees with petitioner that the cancellation of
the Contract to Sell may be done outside the court particularly
when the buyer agrees to such cancellation, the cancellation of
the contract by the seller must be in accordance with Sec. 3
(b) of the Maceda Law, which requires:(1) a notarial act of
rescission and (2) the refund to the buyer of the full
payment of the cash surrender value of the payments on the
property. Actual cancellation of the contract takes place
after 30 days from receipt by the buyer of the notice of
cancellation or the demand for rescission of the contract by a
notarial act AND upon full payment of the cash surrender
value to the buyer.
Here, the Contract to Sell was not validly cancelled or
rescinded under Sec. 3 (b) of the Maceda Law.First, Patricio,
the vendor in the Contract to Sell, died on September 17, 1992
without canceling the Contract to Sell. Second, petitioner
also failed to cancel the Contract to Sell in accordance
with law.
Meanwhile, petitioner asserts that his demand letter should be
considered as the notice of cancellation or demand for
rescission by notarial act and that the cash surrender value of
the payments on the property has been applied to rentals for
the use of the house and lot after respondent stopped payment
after January 1980.
The Court, however, found that the letter merely made formal
demand upon respondent to vacate the premises in
question. Clearly, the demand letter is not the same as the
notice of cancellation or demand for rescission by a
notarial act required by the Maceda Law.
Moreover, petitioner cannot insist on compliance with the
requirement by assuming that the cash surrender value
payable to the buyer had been applied to rentals of the
property after respondent failed to pay the installments due.
Sec. 3 (b) of the Maceda Law does not provide a different
requirement for contracts to sell which allow possession of
the property by the buyer upon execution of the contract like
the instant case but the refund of the cash surrender value
of the payments on the property to the buyer before
cancellation of the contract.
There being no valid cancellation of the Contract to Sell, the
Court held that CA correctly recognized respondent’s right to
continue occupying the property subject of the Contract to Sell
and affirmed the dismissal of the unlawful detainer case by the
RTC.Consequently, it is only right and just, under the
Maceda Law, to allow respondent to pay her arrears and
settle the balance of the purchase price, subject to
interests.